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Lord Hunt of Kings Heath: My Lords, the intention is that appropriate health services of NHS standard are available.
Earl Russell: My Lords, can the Minister confirm that the remuneration of GPs includes a considerable capitation element for regular performance of routine tasks such as vaccinations? Can he confirm that in the case of the homeless, that has been a deterrent to GPs registering transients? Can he tell the House whether the dispersal policy has made that operate even more in the case of asylum seekers?
Lord Hunt of Kings Heath: My Lords, there have been cases in which GPs were reluctant to accept asylum seekers. There have been one or two cases—we are currently investigating the facts—where a GP had a deliberate policy of not accepting asylum seekers. I cannot support that in any way. The scale of fees and allowances is based on both a basic practice allowance and a capitation allowance, which should ensure that
additional patients mean additional financial rewards for a general practitioner. However, I accept that that may not be sensitive enough in the circumstances raised by the noble Earl. We are in discussions with GPs about their national contracts. We also believe that the PMS pilots give greater flexibility to the NHS at local level, which may enable them to deal with the issues raised by the noble Earl.Railway Stations: Passenger Lifts
3.24 p.m.
Lord Berkeley asked Her Majesty's Government:
- Why passenger lifts at surface railway stations have been closed to passengers during the strike by fire-fighters.
Lord McIntosh of Haringey: My Lords, before the beginning of the Fire Brigade industrial dispute, station operating companies carried out detailed health and safety risk assessments at the behest of the Health and Safety Executive. The HSE has not specifically recommended the closure of lifts at surface railway stations. A small number of station operating companies have judged it appropriate to close passenger lifts during the strike.
Lord Berkeley: My Lords, I am grateful to my noble friend for that Answer. A number of station lifts are still closed, including the one at Oxford. Do the Government believe that an open lift made of steel and glass in an open-air station is at greater risk of catching fire than a lift in an office building? Surely, if a lift breaks down the answer is to call a lift engineer rather than the fire brigade. Can he issue an instruction to the train operators to open the lifts and to give to the staff on duty the name of a suitable lift engineer to call to get people out if the lift breaks down?
Lord McIntosh of Haringey: No, my Lords. The Government do not involve themselves in matters of that kind. Such assessments of safety risks are for the Health and Safety Executive and for the train operating companies. This is not a "nanny state". There are things which can be done, and which have been recommended by the Health and Safety Executive. It is desirable for emergency procedures to be put in place for the manual winding of lifts, and for staff to accompany passengers in lifts. Companies could consider restricting lift use and directing passengers over ramps and footbridges. However, those are matters for the operating companies and the Health and Safety Executive.
Viscount Astor: My Lords, can the Minister tell the House whether the closure of various parts of London Underground was decided by the unions or by London Underground?
Lord McIntosh of Haringey: My Lords, it was decided by London Underground on the advice of the Health and Safety Executive.
Lord Bradshaw: My Lords, if we are not a "nanny state", are we not in danger of becoming a very hysterical state, where at the first excuse people quote health and safety as the reason why lifts are closed; why the roadway at Potters Bar has not been repaired; and why coach seat belts should be worn? It is well known that travel by coach is the safest means of road travel. Can he assure the House that Ministers, officials and anyone else over whom he has influence will try to avoid that type of hysteria, and play down the general reaction of the media?
Lord McIntosh of Haringey: My Lords, I have said within the past half hour that coach travel is one of the safest forms of road travel. I am rather opposed to exhortation as a means of government. The good sense of the British people will resist the kind of hysteria to which the noble Lord, Lord Bradshaw, refers.
Lord Marlesford: My Lords, the Minister referred to a few stations. Perhaps he has not heard, as I did today on the underground, that 22 stations are closed. If the Government have delegated to the Health and Safety Executive responsibility for advice on this matter, is he sure that it is giving correct advice by failing to have lifts closed in hotels, offices, stores and in other buildings to which the public have access, including, at certain times of day, the Palace of Westminster?
Lord McIntosh of Haringey: My Lords, the Question on the Order Paper refers to surface railway stations, not deep stations in the London Underground. My comment of "very few" referred to surface railway stations. The 22 stations of the London Underground to which the noble Lord referred are closed because they are deep stations with access only by lift or very long flights of stairs.
British Energy
3.28 p.m.
Lord McIntosh of Haringey: My Lords, with the leave of the House, I shall now repeat a Statement made in another place by the Secretary of State for Trade and Industry about British Energy:
-
"British Energy operates eight nuclear power stations in the UK, supplies over one-fifth of our electricity and employs 5,200 workers in Britain.
"In May this year the company in its preliminary results announced a pre-tax, pre-exceptionals, profit of £42 million in its UK and North American operations but an overall loss to its UK operations of £41 million. None the less, the company chose to maintain its dividend, paying out £48 million to shareholders.
"During the summer, British Energy decided to attempt a bond issue in the United States. It was unsuccessful. On 13th August, one of the reactors at
- the company's Torness station was taken out of service due to unforeseen problems—reducing the company's income by £56 million.
"The next day company executives told investors that there were no immediate cash flow problems.
"Throughout the summer, British Energy engaged in discussions with BNFL to renegotiate the terms of its contracts. These were entirely commercial discussions between the two companies.
"At the beginning of September, British Energy realised that its financial problems were far greater than it had thought and that any conceivable deal with BNFL would not be enough to meet its requirements.
"On 4th September the company wrote to inform me of a significant worsening of the company's financial position and liquidity problems. It said the board would have to decide, on legal advice, whether it could continue to meet its liabilities and therefore trade legally. And it asked for government help.
"The next day I announced that the Government were entering into discussions with the company. On 9th September I announced a loan facility of £410 million to support its trading operations both in the UK and in North America.
"On 26th September, after a further request from the company, the Government decided to extend the loan facility until 29th November and increase it to £650 million. This was to give the company sufficient time to clarify its financial position and to come to a clear view on its future options.
"Both the initial loan and its extension were notified to the European Commission under state aid rules, and I can tell the House that the Commission announced yesterday that it has approved the loan. I offered that loan because it was the best way of securing the safety of the nuclear power stations and the security of electricity supply to the grid and consumers. These remain my overriding objectives.
"British Energy has submitted a plan to the Government for the solvent restructuring of the company. We, and our financial advisers, have assessed its implications and I can announce to the House that the Government have agreed to play their part in allowing the company to attempt solvent restructuring.
"Both the company and my department have made statements to the Stock Exchange today; I have placed copies of both in the Libraries of the House and in the Vote Office.
"The company has announced that it will continue to make payments to a fund which is used to pay for costs of decommissioning its power stations; give the fund £275 million of bonds in the company; and surrender to the fund 65 per cent of its available cash each year.
"The Government will underwrite these arrangements to ensure safety and environmental protection. In addition, we have recognised that if
- this restructuring is to work, the Government themselves must contribute significantly to the company's £2.1 billion of historic nuclear fuel liabilities managed by BNFL which extend to 2086. The cost to the Government will average £150 million to £200 million per annum for the next 10 years and fall thereafter.
"If the company does very well, surpluses from BE's contribution to the decommissioning funds will help meet these costs. But I also intend to look at how these contracts are managed as part of the creation of the Liabilities Management Authority.
"In addition, BNFL is today announcing that it will agree new contracts with British Energy for fuel supply and for spent fuel services in respect of future nuclear electricity generation.
"If the company's proposed restructuring is to succeed, the existing creditors will have to accept a temporary freeze on payments and subsequently a significant writedown in the value of what they are owed. Secondly, the company will have to complete the sale of all its North American operations. And, thirdly, the company will have to implement the new trading strategy it has announced today.
"Agreement to this must be achieved by the middle of February.
"The Government are prepared to continue to fund BE's operations while the restructuring plan is agreed and implemented. The existing credit facility will be extended to 9th March with the size of the facility remaining unchanged at £650 million.
"Of the existing facility of £650 million, £382 million had been drawn down by yesterday. Under the proposal, the money will be progressively repaid as the financial situation improves. And in the event of administration we have taken security to protect the interests of the taxpayer and rank above other creditors.
"I also intend to bring forward legislation shortly to enable me to carry forward the Government's part of the proposed restructuring or, if it fails, to acquire the companies or their assets.
"This proposal for solvent restructuring will of course need state aid approval by the European Commission. Once the company has reached agreement with its financial creditors we will notify the plan to the Commission.
"I said in September that, if possible, we would look to a solvent restructuring. However, we did not rule out that the company might decide to go into administration.
"We have therefore prepared detailed contingency plans for administration in discussion with all the key responsible regulatory bodies to ensure that whatever happened nuclear safety and security of supply would be maintained.
"Let me stress that if British Energy were to go into administration all its nuclear liabilities would fall to government. We cannot just walk away from
- them; no responsible government would. This is the reason why the situation with British Energy is different from any other generator.
"I would like to take this opportunity to thank the staff at British Energy. Their skill and dedication is essential to ensuring nuclear safety. This has been an unsettling time for them but whatever happens nuclear power stations will continue to generate electricity and will continue to employ staff. Pension entitlements will be met. Trade suppliers will be paid. And customers' lights will stay on.
"I understand that today's news will give little comfort to British Energy's financial stakeholders. But they too must take their share of the pain if the company is to survive. The stakeholders now need to decide whether they are willing to support solvent restructuring. If they are not, the Government are fully prepared if British Energy decides that administration is the only option.
"Today the company has announced that Robin Jeffrey is stepping down and that Adrian Montague will succeed him as chairman. Mr Montague is an experienced executive who brings key business experience, from both the public and private sectors. It is clear there have been management failings and I think it is right for the company to be seeking to strengthen the management team at this critical time.
"I have set out today the limits of what the Government are willing to do to support solvent restructuring. It is now up to the company, its new management and its financial stakeholders to determine the future of British Energy".
3.37 p.m.
Baroness Miller of Hendon: My Lords, I thank the Minister for repeating the Statement made in the other place by his right honourable friend the Secretary of State for Trade and Industry. It has at least given Parliament the chance to question Her Majesty's Government over a decision taken almost three months ago which committed £650 million of taxpayers' money to bailing out British Energy, although, as we see it, occurring at the last possible parliamentary moment before a decision by the Government had to be made.
In a fairly detailed Statement, I find it somewhat strange that no mention is made of the climate change levy. Does the Minister not consider it absurd that Her Majesty's Government claim that imposing the climate change levy is part of their strategy to meet our climate change commitments? Since nuclear power is the principal energy source that does not generate CO 2 emissions, this is really an absurd contradiction. The fact is that British Energy will always struggle until the climate change levy is removed.
Does the Minister agree that the right answer would be to abolish the climate change levy, an arbitrary tax that unfortunately does not play a part in addressing the climate change problem? Does he further agree that it could be replaced with a single economic
instrument which could be an emissions trading system or a carbon tax? Is the Minister aware that this is not just a view that I mention as a member of my party but that of the Royal Society which only two weeks or so ago issued its policy document on this very important matter? Can the Minister tell the House why Her Majesty's Government do not accept these arguments by the Royal Society, which were strongly and with authority put in the paper that it issued? Does the Minister agree that the approach I have just indicated would improve the position of both nuclear and renewables compared with fossil fuels? Or is the problem that the Treasury perhaps would not like it?The Statement indicates that BNFL is announcing today that it will agree new contracts with British Energy for fuel supply and for spent fuel services in respect of future electricity generation. But is it not a fact that, some time ago, British Energy reached agreement with BNFL on terms that the department agreed, only to have the agreement blocked by the Treasury?
Does the Minister realise that part of the problem is the Government's muddled approach to the whole of the nuclear industry, with Ministers not singing from the same hymn sheet? Does he recall a statement on British Energy made by the Minister of State as recently as 17th November to the Sunday Times? He said:
- "We need that supply, so come what may, nuclear generation will continue".
In the Statement, the Minister told the House that British Energy has submitted a plan to the Government regarding the solvent restructuring of the company. The Secretary of State said that she and her financial advisers have examined and accepted it. Of course, we hope that it is successful, but as we know that the security of supply is of the most overriding importance, is it consistent with the new electricity trading arrangements, NETA? The Minister who made the Statement is not the Minister who answered a Question on Monday on electricity supply, when that very matter arose. The noble Lord, Lord Sainsbury, said that he was totally satisfied that there would be no problem with supply. Can the Minister tell us whether that is still the position?
Perhaps some consideration should now be given to the remit of the regulator. Much as we like electricity costs to be as low as possible for consumers, we also want an electricity supply and an electricity generating industry. Are the new financial commitments mentioned in the Statement included in the new, huge borrowing requirements announced by the Chancellor of the Exchequer yesterday in the other place? Now that the Secretary of State has made it clear that she will not let British Energy go into administration, what is the assessment of the cost to the taxpayer?
The problems of British Energy are undoubtedly due to the fall in prices paid to the generator, which have not been helped by NETA.
I am terribly sorry, but I must tell the Minister that if he was confused by anything that I said, so was I, because I read page seven of my brief before page six, which is absolutely appalling. He must have thought it rather strange that all of a sudden I mentioned NETA out of all context. Did noble Lords notice?
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