John Redwood's Diary
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Keeping the lights on

The government’s ambitious plans to move to net zero require the widespread adoption of electric cars, electric heating and  much else that will need more power to be generated. It will also of course require most if not all of this electricity to be generated from renewables. The current starting position includes around one fifth of our power coming from nuclear power stations. Most of these are scheduled to close for old age this decade. We also often import around 5% of our power from the continent at some cost to ourselves and the balance of payments. We need to regard this as an unreliable source given the problems with continental capacity and their present reliance on Russian gas and some coal. A substantial but variable portion of our present electricity comes from  gas fired stations, depending on how strongly the wind is blowing and how many sunshine hours there are for the renewables.

Germany is becoming more dependent on renewables and has had some outage problems on cold calm days with little sunshine. California has power cuts from her dependence on renewables, despite having a usually favourable  climate for wind and sun. As the UK plans its way to net zero it needs to promote getting sufficient electricity capacity higher up the list of priorities.

The UK used to seek guaranteed supply and relatively low cost from its electricity policy. Privatisation in the 1980s drove down costs by replacing old and inefficient coal stations with much more fuel efficient modern gas combined cycle stations. The merit order meant the cheapest power was delivered on base load, only to be topped up by the more marginal dearer power. Environmental requirements were added as a third aim of policy. Privatisation did reduce CO2 output substantially by closing so many coal stations from market forces. Prices of power fell.

As policy has come to be dominated more and more by greenhouse gas considerations, the price of power has gone up and the margin of spare capacity has fallen. Indeed, capacity has become a difficult thing to estimate or measure. The more renewable power on the system the more variable the capacity is, varying from minute to minute depending on weather conditions. The system managers have a more difficult task than before. They are turning to interruptible contracts, to get industry to switch off if the wind stops blowing. They are calling for battery parks to offer stand by capacity, seeking people with stand by diesel generators for difficult times and wanting to flex tariffs to encourage off peak use. All of these methods can help, but they cannot be a substitute for having enough capacity with a decent margin to allow for variability of supply from renewables.

There are some approved renewables or green methods of generating power that are always available or available to a predictable pattern. Biomass or wood burning is as good as coal or gas as reliable power, there when you need it. Certain designs of water power are there on  stand by or available for regular times depending on tides, pump systems, and reservoir controls. Reviving water wheels from the past alongside windmills would have given more reliability. The UK has only one main pump storage system. It could do with some more to give the flexibility the system managers will need.

The scale of the task is immense. If the government is serious about ending new diesel and petrol cars from 2030, and serious about the widespread adoption of electric heating, the demand will be greatly magnified from today. Yet today we are close to power cuts every time we have a cold day with little wind or sun. I will ask our latest  Business Secretary to do something about our future capacity, as I have asked his predecessors.

The long road to net zero

 

We will soon hear of the Earth Summit in April to be set up by the USA. It will be followed by the Petersberg Group on climate change in May and the G7 in June, leading inexorably to the big global UN conference, COP 26 in Scotland in November. The aim of each of these meetings is to establish firm pledges from countries on how quickly they will bring down the carbon dioxide and wider greenhouse gas output of their countries. The world establishment now wants shorter term targets and tough realistic pledges on the long road to net zero by the middle of the century.

Some of my readers welcome this, and others are sceptical about various aspects of the climate change movement. I am writing this accepting the twin facts that governments believe there is a serious manmade climate problem created by greenhouse gas production, and intend to do many things to control and reduce the output of these gases. There are  no mainstream political parties  with a reasonable number of MPs taking a different view in Europe and the UK, and it is likely the Republicans after Trump will move closer to the Democrat position. International bodies and civil services are enthusiasts for this theory, and welcome the radical policies it ushers in. We are in for many more bans, rules, controls, and taxes to wean us off fossil fuel based goods and services, and for more subsidies and state sponsored investments to build the new green economy. Costs and charges of various products and supplies will be pushed up to discourage use. As the UK Climate Change Committee proposes, they want change in how we travel, in how we heat and cool our homes and workplaces, how we generate our electricity, how many products are produced in factories and in what we eat. They wish to see a reduction in meat and diary products.

I would be interested to hear your reactions to this, and to know how you will change your conduct if at all in the light of the likely changes to come.

Cutting wood miles? Let’s make use of the government’s enthusiasm for more trees.

I asked some questions to pursue the issue of increased UK timber production. I was aware of the government plans to promote the planting of many more trees as part of its climate change policies. The net zero carbon target now drives much of government policy. The interest in this within government is intensified by the long run up to the World Climate Change conference, COP 26 which the UK will host at Glasgow in November.

Whilst in general terms the answers show continuing commitment to more tree planting, they are short on detail. The pace of change is also slow. There is a big opportunity to expand woodland areas rapidly, and to  encourage timber growth in sustainable woodlands. The owners can then harvest the timber and replace the trees on a defined growing cycle. The UK’s warmer climate allows faster growth than Scandinavia and Canada where much of our timber currently comes from. The UK has substantial need of imported timber at the moment for construction, furniture and other purposes. We even import the wood to burn in  the Drax power station.  I will continue to press for faster action.

 

To ask the Secretary of State for Environment, Food and Rural Affairs, what plans he has to encourage the use of UK-produced timber to reduce wood miles. (142750)

Tabled on: 25 January 2021

Answer:
Rebecca Pow:

This spring we will publish a new England Tree Strategy, setting out plans to increase tree planting in line with our manifesto commitments, and to increase the management of existing woodlands. These actions will provide more domestic timber now and, in the future, reducing our reliance on imports. To drive sustainable investment into UK woodlands we also want to see the expansion and use of the Grown in Britain Certification mark throughout the supply chain, reducing the carbon footprint of the construction industry.

The answer was submitted on 02 Feb 2021 at 17:45.

 

To ask the Secretary of State for Environment, Food and Rural Affairs, if he will work with Drax power station and UK forestry to source UK biomass to replace imports. (142751)

Tabled on: 25 January 2021

Answer:
Rebecca Pow:

Our woodlands provide habitats, capture carbon and provide sustainable sources of fibre and fuel. We are seeking to increase planting across the UK in this parliament, and to bring more woodlands into management. This will increase the domestic supply of wood for a range of markets.

We are also developing a Biomass Strategy for publication in 2022 and will issue a call for evidence shortly. As part of the strategy we will review the amount of sustainable biomass available in the UK, and how this could be best utilised across the economy to achieve net zero.

The answer was submitted on 02 Feb 2021 at 17:30.

 

My speech during the debate on Exiting the European Union (Value Added Tax), 3 February 2021

 

As the Minister has told us, these are two important statutory instruments for the facilitation of trade generally and for the facilitation of trade within Northern Ireland and between GB and Northern Ireland, and to the extent that they make things easier and allow zero rating of important services and goods, I welcome them wholeheartedly. But, of course, as others have said in this debate, we meet today against the background of clear difficulties and problems in the implementation of the Northern Ireland protocol, where it appears that a number of important impediments to GB-Northern Ireland trade have been inserted, and it is crucial that the talks go well and we get rid of them as quickly as possible.

So when we look at the administration of VAT, which is an important part of the trade process, I would like an assurance from the Minister that these regulations, and all the other VAT and excise rules applying in Northern Ireland and throughout the United Kingdom, will be solely administered and enforced by United Kingdom authorities, because I have much more confidence in them.

Will he also assure me that the aim of these statutory instruments, and the wider VAT legislation that they add to and amend, is to ensure that the movement of goods from Great Britain to Northern Ireland, or the other way, will be as smooth and easy as the movement from London to Surrey or from Manchester to north Wales, because that is what I thought we had agreed and signed up to—that Northern Ireland was a fully integrated part of the United Kingdom single market, under our single market and taxation rules? I would like the reassurance through these statutory instruments that we are intending for that to be true.

Will the Minister also confirm that there has for many years during our period in the European Union been an important VAT border between the United Kingdom and the Republic of Ireland, but that it has always worked very smoothly and was not enforced at the physical border, in accordance with the spirit of agreements and not wanting barriers at the land border?

It was an electronic border and adjustments were made by computer or by correspondence so that these things could be sorted out in a sensible and decent manner without having to have people queuing at borders to make complex calculations and submissions.

If that is the case, does the Minister agree that it is in that spirit that we need to find the answer to the current impositions and difficulties affecting our trade across those borders? It seems very odd that we cannot replicate that success of our past trading, where electronic manifests, trusted trader schemes and so forth, and proper electronic VAT registration worked very well. Surely the UK authorities, if we are the proper and sole enforcement authority in Northern Ireland, can work with trusted traders, VAT-registered hauliers and ferry companies and so forth, and we can accept their certification or word that the goods on their load are entirely GB-Northern Ireland or Northern Ireland-GB. We can then accept, therefore, that there are no other considerations and the loads can then move as smoothly as from London to Guildford or Manchester to north Wales. It would be very helpful to hear the Minister’s views on how that can be achieved and how quickly we can get to that point.

It is absolutely crucial to the people of Northern Ireland, as we have heard from their representatives, that they can trade smoothly with the rest of the United Kingdom. That was fundamental to the spirit of the agreements that the United Kingdom entered into with the European Union over the issue of trade with and between Great Britain, Northern Ireland and the Republic of Ireland. I hope the Minister will have good news for us and that these things can be sorted out quickly.

Trade frictions within the UK

Yesterday in Parliament I raised the issues of trade friction  between the GB and Northern Ireland again in the Commons. I will post my speech when it is available.

I was pleased that Michael Gove now accepts there are important issues to be sorted out and is  engaged in talks with the EU, the Northern Ireland Executive and the Republic of Ireland. Maybe he can get an agreement to sort these matters. If not he will need to legislate urgently  in the spirit of the EU’s acceptance that Northern Ireland is fully part of the UK’s single market and customs area to ensure the smooth flow of trade between GB and N0rthern Ireland. Our border officials need to know that goods destined to flow between different parts of the UK should pass as easily as between London  and Surrey when it comes to excise, VAT and goods checks.  The idea that there would be lots of people seeking to evade  goods checks into the Republic by routing things through Northern Ireland and claiming them to be UK domestic trade is wrong. Most of the trade we are talking about is large supermarkets supplying their stores in Northern Ireland, or deliveries by Trusted traders and large hauliers who wish to keep their privileged status and good record with the authorities.

I did not vote for the EU/Uk Agreement because I had worries both about N0rthern Ireland and fish which I highlighted in the debate. These remain real issues and need urgent attention to tackle them.

COVID-19 Vaccine Deployment Update

I have received this update today on the Covid-19 Vaccine Deployment programme nationally. In Wokingham, the programme is proceeding on schedule and constituents should wait to be contacted about when they will receive the vaccine.

Dear John,

We are writing to you to update you on the latest important developments on our deployment of COVID-19 vaccines.

We are delighted that by the end of 1 February, 9,646,715 people in the UK have been given their first dose of a COVID-19 vaccination. We have now vaccinated almost 9 in 10 over 80s.

We set the ambitious target of offering a vaccine to all eligible elderly care home residents and by the end of January we met that target. This is an incredibly important step in the fight against this terrible virus. Elderly care home residents were rightly prioritised because they are the most at risk and we have done everything we can to protect them.

There are a small number of care homes who have not been able to get vaccinated due to an outbreak, but all elderly care homes where it is clinically appropriate have now been offered the first dose of the vaccine.

This is the biggest vaccination programme in NHS history. It has been a huge national effort, bringing together the NHS family, primary care networks, hospitals and the tens of thousands of amazing volunteers.

Looking ahead, our vaccine supply and scheduled deliveries mean we are on track to offer vaccinations to all those in JCVI priority cohorts 1-4 by 15 February. While meeting this target is a challenge, we are on track to meet it.

The latest statistical release for England can be found at the link below, and we are committed to publishing more granular data, as soon as is feasibly possible.
https://www.england.nhs.uk/statistics/statistical-work-areas/covid-19-vaccinations/

Despite this success we know our NHS continues to be under serious pressure. So, it is vital that we all continue to follow the rules: stay home, protect the NHS, save lives.

Yours ever,
MATT HANCOCK
NADHIM ZAHAWI

The need to make and grow things at home – national resilience

The UK fought  two massive and bruising wars in the last century. On both occasions the UK state declared war on Germany without having the military resources in place to be able to defeat German armies on the continent. The story of each war was the same. Initial disasters for the expeditionary forces, skilled and brave  but outnumbered, had to be followed by a massive scaling up of commitment. Vast citizens armies had to be recruited and trained. The UK had to rely on and build alliances to assist in victory. On both occasions getting the USA involved was particularly important. On both occasions the government had to transform our economy, turning much production over to a war footing, to make sure we could produce the guns, ships and planes needed to sustain major conflict from our own resources in our own factories, and growing enough food to avoid starvation. In each war the German strategy of trying to cut off our overseas trade by lethal submarine and surface raider attacks proved difficult to contain and threw us back on to more and more domestic self reliance.

The fact that we started each war with a professional military which could expand and change under the need to build a  citizen army  helped. We could also  create,  train and equip a much larger airforce, from scratch in 1914 and from  a small one in 1939. The fertility and relatively clement climate for growing temperate foods also helped, with flower gardens and parks being tilled for vegetables. The excellence of UK technology, with leads in several fields for both wars also assisted. As we study those events today we should of course redouble our efforts to make sure we do not need to plunge into such  vast conflict again. We should also learn the crucial lesson, that you cannot defend your country unless you have sufficient production capacity to supply and replenish a war machine in wartime conditions. It is no good relying on imports, licensed technology controlled by others and basic foods from abroad if you need to win a serious war.

In 1914 and 1939 we had our own coking coal, steel furnaces, tank, gun and ship designs and chemical  factories to make explosives. In 1939 we had some great private sector aircraft designs which could be built at speed and scale. Many factories making discretionary consumer items could be flipped to war production. Furniture factories could even make the wooden Mosquito plane to add additional numbers to the airforce capability.  In a remarkable drive the UK reached output of 26,000 planes a year in 1943 and outproduced Germany in planes over the war as a whole, whilst the US ramped up from 2141 planes in 1939 to a massive 96,318 in 1944.

Today when planes and ships are more complex and expensive than in the 1940s we struggle to produce more than a handful. Procurement is very dependent on overseas supplies, and NATO action rests on interoperability and shared capacity with allies. The UK needs to have plans for how it would cope were one or more of our allies to fall into hostile or unfriendly hands, and have plans on how the UK would sustain herself in war conditions. That requires ensuring we have control of the main technologies which we could use for ourselves if needed, and control over sufficient production capacity with raw materials or access  to them. It also means remembering it is good to be able to feed yourself to a sufficient standard as part of national resilience.

Having sufficient control over wider technologies, raw materials and skilled labour is also helpful in less stressful times, when the wars are fought with words and laws over trade issues with tariffs, export bans and the like. As the world trends towards more national self reliance, the UK should look more  to herself in important areas so we can cope in adverse circumstances.

More urgency needed to rebuild our fishing fleet

Question:
To ask the Secretary of State for Environment, Food and Rural Affairs, if he will take urgent steps to help expand the UK fishing fleet. (142753)

Tabled on: 25 January 2021

Answer:
Victoria Prentis:

The Government remains committed to supporting the fishing industry and our coastal communities. The Trade and Co-operation Agreement with the EU reflects the UK’s new status as an independent coastal state, and we have taken back control of our fishing waters. By the end of the five-and-a-half-year period, the share of fish in our waters which UK boats will catch will rise from half to two thirds.

The Government is supporting the opportunities available to the UK’s fishing industry and has committed to providing £100m of investment to rejuvenate the industry and coastal communities across the UK. Further details will be set out in due course.

The answer was submitted on 02 Feb 2021 at 13:07.

Free trade and the retreat from globalisation

I accept the theory of free trade, that all nations would  be richer if they traded  freely with each other. Successive rounds of GATT followed by the work of the WTO have boosted world economic activity a bit.

I also agree that for any individual country in theory  it could be better off if it went for unilateral free trade, on the grounds that it would benefit from cheaper imports, though would not gain extra opportunity for its exports. I do not however recommend such a policy because it does assume that other countries would not exploit the perceived weakness of a country welcoming more  imports without demanding something in return. Were other countries to accept the freedom to sell to that country and at the same time exploit it by making imports from it more difficult it might harm the country making the unilateral offer. It can also lead to strategic weakness by being import dependent on countries that may later become hostile or unhelpful. Trade theory assumes rational economic actions by others, when they may act in a harmful economic way for other reasons.

I am a free trader who believes in offering to remove tariffs and barriers in return for similar offers from trading partners. Today we must recognise that there are strong winds of economic nationalism. President Trump called out China for her trade and IP practises. He  moved to ban certain Chinese trade in goods in technologically sensitive areas, and imposed tariffs in an attempt to stem the tide of imports. President Biden is continuing with the same policy albeit with a different choice of diplomatic language. He is reinforcing the idea of making more things in America to replace imports. China retains higher tariffs than the west, controls inward investors through joint ventures and restricts access to some markets.

There have always been cultural and administrative restrictions on free trade and investment in countries claiming to believe in open markets and the free movement of capital. Some  UK  companies have found it very difficult to invest and work in France and Germany despite being members of the single market for many years. UK retailers for example, reckoned to be world leaders in our early days in the EEC/EU,were unable to build profitable chains of shops on the continent. There have also always been aggressive strategies pursued by some countries to grab market share for their companies and put others at a disadvantage. We have just seen some of this over vaccine production and supply within the EU.

Given the avowed America First, EU first and China first policies  being pursued currently, the UK needs to do more work on import substitution and domestic capacity.  There is a fixation with marginal changes to export volumes and opportunities, and too little study of how we can become more  independent in timber, energy, fish, temperate food,and much else besides. The recent expansion of vaccine production here at home has been a  great strength and shows what can be done when there is a concerted effort to use our new freedoms to good effect.

Christianity, the EU and Brexit

This is the article I published on Conservative Home:

 

 

It was a revelation to read a tweet from the Archbishop of Canterbury that was critical of recent words and attempted deeds of the EU. The Church he leads has often been identified with the various Lib Dem and Labour Remain campaigns which he and  other Bishops have  supported in the Lords. These campaigns have always worked from the basis that the EU can do no wrong and the UK can do little right.

His tweet is worth examining, because it explains why he and others like him have been so pro EU before. It turns out to be grounded on some basic misunderstandings of both the nature of the EU and the evolving  constitution and nature of the English/UK state.

“The EU was originally inspired by Christian social teaching at the heart of which is solidarity. Seeking to control the export of vaccines undercuts the EU’s basic ethics. They need to work together with others” he wrote.

Not exactly, Archbishop.

The EU began life as the EEC, a development of the German zollverein or customs union. It was neither free trade oriented nor open to the rest of the world, based on protectionist thinking. The early EEC/EU was strictly secular. The first reference to religions in the Treaties was introduced at Lisbon and remains today as Article 17 of the Treaty of the functioning of the EU. That states that the Union respects different religions and different philosophical and non confessional organisations recognised in individual member states. It does not accord any priority to Christianity or any other religion, and merely says  the EU will have a dialogue with all these bodies. There is no official Church of the EU.  The preamble to the Treaty of Union shows how eclectic the sources of  EU thought are by saying “drawing inspiration from the cultural, religious and humanist inheritance of Europe”. France, a fiercely secular state fought successfully to avoid any reference to the Christian religion in the EU Treaty or constitution. The EU has sought to define inalienable human rights that come from no particular faith or philosophy.

In contrast there are several states in Europe that do afford a special place or mention to a Christian Church and Christian values  in their constitutions.  Denmark, England, Greece, Hungary, Malta and  Norway for example all have state Churches that are identified and given various special privileges or mentions. England is one of the most generous to its established Church, the Church of England which the Archbishop leads.

I do not hear him talking much about the special status the Church enjoys in English and wider UK life. The Church owns substantial legacy property and investment wealth courtesy of the UK state and Parliament.  MPs do not  question this.  Parliament moreover allows the Church to collect all rents and dividends free of income tax, take all capital gains free of Gains Tax, and buy assets free of Stamp Duty, to give it maximum scope to build its wealth and grow its income. It would be good to hear more debate on how that is being used.  It has its own Parliament, rule making and disciplinary bodies, though they are answerable to the UK Parliament and ultimately governed by UK law. The Archbishops and senior Bishops have seats , votes and voices in the UK legislature. Though they are there as part of the wider governing establishment they are under no duty to support the government, and often during a  Conservative government vote and speak in opposition. They  also vote on Northern Irish and Scottish matters  outside the area of their clerical authority. The Archbishop himself has been a  critic of various Brexit measures including the recent  Trade Bill and Internal market Bill.

The Church of England  benefits from its status as the established Church, gaining a near monopoly over all the main UK national and English civic events from royal weddings and funerals through Remembrance Day services, national anniversaries,  civic services for Councils and Mayors, daily prayers in Parliament, to a network of Church schools receiving taxpayer finance. These swell otherwise dwindling congregations.  I will explore the nature of solidarity and where that stands in  modern politics in a later post. I look forward to the evolution of the Archbishop’s thinking on EU matters as he studies  more how the EU seeks  advantage and augments its power in ways that do not offer friendly co-operation with the rest of the world.