“to exercise a discretion, or with the consent of the Secretary of State to allow”.
The Opposition are pleased that the Government accept that, in general, the provisions of the Planning Act 2008 are working to speed up the development and delivery of our national infrastructure, something that is much needed at present. Like the Government, we accept that the process can be tweaked to make it quicker and to remove major hold-ups in the system. I will say more about that when I speak to new clause 11.
Amendment 48 is largely a probing amendment. It seeks clarification from the Minister on the safeguards that will be employed with regard to changes made to development consent orders. Paragraph 12 of the Department’s briefing note on nationally significant infrastructure projects, produced in June 2014, notes that consultation responses to the Government’s review of the working of the nationally significant infrastructure planning regime commented that existing procedures for making changes to applications, once approved and subject to a development consent order, had not yet been tested, but
“were likely to be onerous and in many cases disproportionate”.
The paragraph also makes it clear that although there was
“strong support for making changes to procedures to simplify them”,
there was also very strong support for providing additional guidance on the procedures that would be employed. I shall come back to that very important point.
People seemed to feel that if changes were made to development consent orders, it might be quite an onerous system. However, because the system had not been sufficiently tested, there was no evidence on which to base such comments. We need to consider that the changes are being made without any evidence at all. If no evidence is available, we need to be clear about how those changes will operate in practice so that there is a good understanding of what they mean. They need to be transparent and underpinned by transparent procedures.
The Minister will know that the issue was raised by my noble Friend Lord McKenzie of Luton in the other place, and Baroness Stowell gave a degree of reassurance about how the changes proposed in clause 25 will apply differently depending on whether a non-material or material change to a development consent order is being proposed.
Lord McKenzie also asked about progress of applications as a result of applying the national infrastructure plan regime and he received a surprising answer about the effectiveness of the current system. In July, he was told that 20 applications had gone through the system; 19 had been granted consent; a further 56 were in the pre-application stage, and more were in other parts of the system. Will the Minister update us on progress made on applications since July so that we can set the changes proposed in clause 25 in proper context? That would be useful.
The general view from information given in the other place is that the system is working well, but we need to be clear about what is meant by a material or non-material change, given that the proposed changes could water down the consultation required depending on how such changes are classified.
The Department for Communities and Local Government’s response to the consultation reported general support for clarification of what was meant by material and non-material changes, and we concur. In particular, we agree with the point in paragraph 12 about guidance. That is, however, where the Government’s case falls down. In responding, they failed to produce the guidance that people wanted, but said that
“it is not possible to set out precise, comprehensive and exhaustive guidance on whether a change is material or non-material as this will depend on the circumstances of individual cases.”
Therefore, rather than the detailed guidance that the respondents wanted in order to support changes to development consent orders, instead we are given quite difficult semantics. Three different circumstances are given in which something would be considered to be non-material if that does not involve something. The use of double negatives is never helpful.
I think that that means that a change is likely to be material if it requires an update to the environmental statement that was carried out when the original development consent order was made and will therefore need to take into account any likely significant effects on the environment. The second criterion offered is that there would be a need for a habitat regulations assessment or a need for a new or additional licence in respect of a European protected species. The third criterion is that it would involve compulsory acquisition of any land that was not authorised through the existing development consent order. Given the rather strange way in which we are dealing with material and non-material classifications, perhaps we could have a degree of clarification from the Minister.
As the Minister also knows, in response to the consultation respondents suggested a number of other characteristics that could be used to help determine whether or not a change was likely to be non-material. These included changes to the height and design of buildings that had been given building consent and a development consent order; what particular effect any changes proposed to the order would have on residents; what impact changes would have on businesses and any nearby housing developments; whether changes would involve moving a highway or stopping up a public right of way; and whether they would encroach on a major hazards installation. It would be very illuminating to hear from the Minister why these important criteria—which came out quite strongly in the consultation—have been rejected. That is especially important for the Committee because the Government appear to have rejected the criterion of changes that could impact on neighbourhoods and local communities for inclusion in the definition of what is material. There is some concern about this. Perhaps the Minister could explain for us why these factors have been rejected.
Could the Minister tell us where the relevant Department is up to with producing regulations on what is meant by a material change? It would also be helpful to know by what process the regulations—once they appear—are to be dealt with. Are they to go through the affirmative or the negative procedure? These are very technical issues, which a lot of people who will subsequently have to operate this system need to be able to get their heads around. Will there be adequate consultation? Will this be publicised effectively? If this is done by an affirmative procedure, as I sincerely hope it will be, will the Minister ensure that there is debate in the House so that the full impact of the changes can be properly considered?
I also wish to hear from the Minister what process will be put in place to check that the changes, where they are deemed to be non-material, are being properly consulted on and publicised effectively. Paragraph 23 of the response to the consultation paper states that this is to be done with a notice being sent to the Secretary of State, along with a statement setting out how the requirements have been met. Is there any intention to check this at all, even on the basis of random sampling? From the information given in paragraph 23, it would appear not. Surely this is a major shortcoming in the approach. With that, I will leave this issue for the moment and wait to hear what the Minister has to say.
The hon. Lady has gone much wider than the amendment in her introductory remarks. That is perfectly in order. I have no problem with that, so long as we understand that that militates against a stand part debate at the end of the clause. I mention that now in case other hon. Members wish to avail themselves of the opportunity to talk on matters other than those related directly to this amendment but, most certainly, related only to the clause.
I am grateful to the hon. Lady for tabling the amendment and raising her points, all of which I will try to answer.
In our technical consultation on planning measures last summer, we proposed a number of changes to help simplify the regime for making changes to development consent orders for nationally significant infrastructure projects. For non-material changes, that included making the applicant responsible for the existing requirements on consultation and publicity, rather than the Secretary of State, which is the current position. There was strong support for that proposal in the consultation, with 80% of respondents in favour. We indicated our intention to take the change forward in our response to the consultation, which was published in November.
The current requirements on consultation for a non-material change require the Secretary of State to consult all persons and organisations notified of the original application for development consent, by sending them a copy of the notice that is published to advertise the application. There are no proposals to change those requirements. The applicant for a non-material change will still need to consult organisations and individuals in respect of an application for a non-material change to a development consent.
Additionally, the Secretary of State is currently required to consult any person they consider should be consulted. In our consultation last year, we proposed that that should be amended so that the applicant would need to consult persons or bodies who may be directly affected by a change. That will provide a more proportionate approach, given that applications for non-material changes have, by their nature, limited impacts or no impacts at all.
The current regulations state that the applicant need not consult someone they are otherwise required to consult if the Secretary of State is satisfied that that is not necessary and publishes the reasons for reaching that view. I understand that this might seem slightly strange, given that the applicant currently has no role in carrying out the consultation. The current provision, as drafted in 2008, simply reflects the fact that the Secretary of State is effectively consulting on the applicant’s behalf in respect of non-material changes. However, our proposals will make the applicant responsible for the consultation. That provision will therefore be retained, meaning that the consultation requirements for non-material changes will be framed in precisely the same terms as the amendment sought by the hon. Member for City of Durham. An applicant for a non-material change will have to consult persons set out in the legislation, unless they obtain a dispensation from the Secretary of State not to do so.
The shadow Minister raised some questions. First, she asked whether guidance would be issued and whether there could be more of it. The clause enables secondary legislation to be introduced later this year, and the Department intends to provide additional guidance at the time when that legislation comes into effect. The statutory instrument will be subject to the negative resolution procedure—I am sorry to disappoint her on that front.
The hon. Lady asked for some statistics, going wider than the terms of the amendment. At the moment, 31 decisions have been made and have gone all the way through the NSIPs process. Consent has been granted for 30, so there has only been one refusal. If she is curious, the refusal was made in respect of the Preesall gas storage facility. That project is being re-determined following a judicial review. I hope that that enlightens her and other Committee members.
The hon. Lady’s other questions were about the concept of materiality. Materiality is quite a nebulous and difficult concept to define, which is probably why it is not defined in statute at the moment. Prior to 2005, when, like her, I was elected to this place, one of my professional duties was to audit sections of company accounts. Materiality, of course, is a concept that any auditor or tax consultant, as I was at the time, will be familiar with, but it is difficult to define and varies greatly. If the accounts of, say, a major mobile phone company are audited, and its turnover is in billions and a discrepancy of £10,000 is found, that is quite clearly immaterial, but £100 million would probably be considered material. However, finding a £10,000 discrepancy in the accounts of a high street baker in the city of Durham or Bristol would be material. Obviously, there is a gradation in between.
It is also the case that we are considering a huge range of large, nationally significant infrastructure projects, from power stations to watercourses, roads, railways and so on. They will vary in size and in the number of people and interests they affect. I guess that is why the framers of the Planning Act 2008—the hon. Lady’s colleagues—did not seek to define what is and is not material.
In the consultation that we published and responded to last year, we gave some examples. For instance, if a change proposed by a developer will have a significant adverse impact on the environment that was not identified when the original application was made, or if there is a need to compulsorily acquire additional land, then it is likely to be considered a material change. I am sure we could come up with other examples of what would be material, but all of them would be germane to the particular circumstances of a particular application. Changing the source of power of a power station from, say, gas to coal would obviously be material, but changing something to do with the internal design of the power station itself would quite clearly be non-material. I am sure we could come up with plenty of other examples, but examples are something that we should always avoid having in a Bill.
I hope that I have answered the hon. Lady’s questions, and I invite her to withdraw the amendment.
I thank the Minister for that response. The points he makes about consultation are helpful and reassuring to a degree. I would invite him to ponder further on who, if anyone, is going to check that the applicant who is responsible for publicising non-material changes is actually doing that properly and effectively. Perhaps he could come back to us with a specific answer to that point.
I am also very grateful to the Minister for the update on the number of applications that have now gone through the NSIPs regime. As we can see, things have moved along very well since July. Nevertheless, I hope these changes will help to speed up the system. I beg to ask leave to withdraw the amendment.
‘(1) There shall be an independent National Infrastructure Commission.
(2) The Secretary of State may by regulations provide for the appointment, duties, functions and staffing of the National Infrastructure Commission.
(3) Regulations made under subsection (2) may make provision for any consequential matter that the Secretary of State considers is necessary to establish the National Infrastructure Commission.
(4) Regulations made under subsection (2) shall be made by statutory instrument.
(5) A statutory instrument under this section shall not be made unless a draft of it has been laid before and approved by both Houses of Parliament.”
Amendment 49 and new clause 11 both deal with the need to shake up the way in which we progress national infrastructure matters. Both raise the need for the UK to have an independent national infrastructure commission.
In the other place, my noble Friend Lord Adonis raised some concerns about how we progress national infrastructure projects. I want to highlight, using new clause 11 in particular, the fact that the Government could have used the Bill to really improve current infrastructure policy.
A recent survey by the CBI showed that, despite some advances in policy on national infrastructure, the UK is still some way off delivering the transformational upgrades that the country needs. The CBI’s survey of 443 senior business leaders showed that in keys areas of competitiveness, such as energy and transport, 67% and 57% of businesses respectively expect infrastructure to worsen, not improve, in the next five years. In some ways that is a quite shocking result. Worryingly, respondents see the UK’s infrastructure as internationally weak, too—lagging behind Australia, North America and the EU. They also note that they have seen little improvement since 2011. Some policies, such as the UK Guarantees scheme, are seen as increasing the attractiveness of the UK, but almost all businesses think that political intervention leading to a start-stop approach to delivering infrastructure is problematic.
What was especially interesting about the survey was that businesses showed overwhelming support—a massive 89%—for the creation of an independent national infrastructure commission, as recommended by Sir John Armitt, to help determine what infrastructure the UK needs and when it needs it. In fact there was massive support for the measure set out in amendment 49 and new clause 11. The CBI deputy director general said:
“Progress on infrastructure has been a case of two steps forward and three steps back for too long…The vast majority of businesses back the creation of an independent body to assess the UK’s long-term infrastructure needs.”
“There is a strong desire for a new approach to infrastructure that extends beyond the five-year electoral cycle. Business is overwhelmingly calling for the establishment of a neutral body to assess the UK’s long-term infrastructure needs. This would transform how infrastructure is planned and delivered across the UK, enabling capacity to be a step ahead of demand.”
The Minister will know that in the other place, my noble Friend Lord Adonis set out the reasons why Labour set up the Armitt review and why we think the establishment of an independent national infrastructure commission is so important. The response in the other place from the Parliamentary Under-Secretary of State, Lord Ahmad, was shockingly disappointing and, I thought, rather complacent. I really hope that the Minister does not follow that form this morning. The Minister in the Lords stated that the Government are set on rejecting the Armitt proposals, which is a pity given the considerable evidence from the business community in support of them. Apparently the Government believe that everything is just fine and dandy with regard to infrastructure planning and delivery in this country, despite the fact that we have considerable evidence to show that the upgrading of national infrastructure is in fact rather weak. The Minister in the other place stated that the Government’s national infrastructure plan and capital settlement were enough to meet infrastructure needs, but clearly they are not.
It also appears that the Government are somewhat concerned about what introducing a degree of independence in the infrastructure planning regime would mean, as Lord Ahmad stated in the other place. Therefore, if the Committee will forgive me, I am going to have another go. I hope that the Minister will embrace the positive spirit that a new year brings and be more optimistic than his colleagues in the other place about what can be gained from an independent infrastructure commission.
I also hope that the Minister will accept that we need to move away from the stop-start approach to planning and delivering national infrastructure projects which for too long has characterised and delayed our national infrastructure delivery. Establishing political consensus in key areas, such as airports and energy in particular, is what we hope can be gained from an independent commission.
The role of an independent commission, as outlined in the Armitt review, emphatically would not be to replace Government, Parliament or the democratic process, but to strengthen them. An independent national infrastructure commission would carry out an evidence-based assessment of the country’s infrastructure needs over a span of 25 to 30 years, focusing on nationally significant infrastructure, as defined by the Planning Act 2008. It would look at energy, transport, water, waste and telecommunications, and it would look at them together, so that their interconnectedness could be properly assessed.
At this stage, we are not proposing that the commission would go into areas of commerce, as set out in the Growth and Infrastructure Act 2013. However, the commission would enable projections of economic and population growth and of technological advances to inform the cross-sectoral approach, as would the need to address environmental obligations. Those obligations could also be considered by the independent commission, as could the impact on other climate change issues.
The results of the commission’s findings would form a national infrastructure assessment to be submitted to the Chancellor, who would have a statutory duty to bring it before Parliament within six months, accompanied by any amendments the Government might propose. Ministers would not be bound by the commission’s findings, but changes made by the Government to the commission’s assessment would have to be clear and transparent, and subject to full parliamentary and public scrutiny. If the assessment were approved, there would be a 12-month period in which individual Government Departments would be required to produce sectoral infrastructure plans, outlining specific schemes and projects that the Government would promote in order to meet the needs outlined in the assessment.
Proposed sources of funding, time frames for implementation and preferred delivery vehicles will be required in the plans to provide real delivery momentum, credibility and confidence for investors. Together, these sector plans would form a national infrastructure plan. Critically, however, before there could be a vote in Parliament, the Government of the day would have to issue a statement commenting on whether the proposals were consistent with identified infrastructure needs and highlighting any area in which departmental plans fell short.
It is hoped that such an approach would focus minds on delivery and that the national infrastructure plan would contain projects intended to be delivered within specific time scales, rather than the wish list that currently exists as part of the national infrastructure plan. How can the Minister disagree with such a common-sense approach?
Actually, HS2 is a very good example. What would have happened prior to HS2 coming to Parliament? The independent infrastructure commission would have set out, very clearly, whether HS2 was needed, based on all the factors that I outlined earlier—population projections, demographic change, changes in the economy and advances in technology—and, if so, over what time scale it would be needed. It would then have been up to the Government to decide whether to put HS2 into a plan to be voted on in the Commons. It would also have been up to particular Departments, working together, to produce the central infrastructure plans to decide whether or not the plan would go ahead.
The commission is about ensuring that we move ahead with national infrastructure plans based on proper evidence and therefore likely to get cross-party support, to ensure that bits of infrastructure are not agreed by one Government and subsequently turned over by another. I hope that answers the hon. Gentleman’s question.
I thank the hon. Lady for giving way a second time. Will she say something about how the national infrastructure commission will work and what its timetable will be? HS2 is an extended programme. If the national infrastructure commission had existed and HS2 had gone through the process she outlined, would there be spades in the ground now, or would it have been delayed for longer?
We are talking about something that we want but does not yet exist. It will clearly take time for an independent national infrastructure commission to set out what it thinks the infrastructure needs are. That is likely to take two or three years because it must gather the proper evidence.
My point is very serious. Almost all business organisations support the Armitt proposals because an independent commission will set out without political bias what it thinks the country’s infrastructure needs are and how they should be delivered. It will help all politicians understand those infrastructure needs. Currently, we do not think about what will happen if we do not deliver a particular piece of infrastructure and how it will reduce our international competitiveness. An independent commission could be charged with making clear what will happen if particular bits of infrastructure do not proceed at the speed that it indicates in its report.
There is widespread support for this approach from the industry and other organisations. It will promote better public understanding of the country’s key infrastructure needs by gathering evidence about the nation’s assets, the projected impact of key economic and demographic trends and the implications of delayed investment. It will set out what doing nothing will mean for this country’s economic development. We need a joined-up, evidence-based approach to national infrastructure. How could the Minister possibly refuse this proposal?
It is a pleasure to serve under your chairmanship, Sir Roger. Like other Committee members, I wish you a happy and prosperous new year.
I rise to say a few words about the exchange I just had with the hon. Lady about the national infrastructure commission. I am not one of those people who is wary of everything that the CBI likes. I like anything about which the CBI consults its members, because it gets such high returns—440-odd high-profile business people returning the survey is a good return. I have issues with how much money the CBI takes from the Government and the European Commission, and I wonder how independent that makes it, but that is an argument for another day.
How will the national infrastructure commission get different results to those of the current system? If, as the hon. Lady said, its discussions will not replace Parliament and Ministers will not be bound by its decisions, it will be just another quango, or a talking shop for the great and the good that will take powers away from this place, to which people are directly elected to make such decisions.