Review of the Week
Money to build our Rural Broadband
Every few months a group of Conservative MEPs meet over dinner in the European Parliament to hear from business leaders. This week my guest and sponsor was Richard Moat joint CEO of “Everything Everywhere”, the new company formed by the merger of T-mobile and Orange.
I first met Richard back in 1995 when, as a banker, I helped raise £1.2 billion to finance the buildout of Orange’s first mobile phone network. We all hear complaints about how hard it is to get banks to lend today but Richard told us that it is a struggle to raise the same amount of money today as we raised back then. This is a very alarming statement - yes we do need stronger banking rules so that they can’t go back to the credit bubble of 2007 but to have turned back the clock by 16 years must be to far.
In coming months the UK will hold its next auction of radio spectrum for mobile telecommunications. This is a one off opportunity to improve mobile and broadband communications especially for rural areas. In many parts of East Anglia you cant get a signal for a phone call let alone link to Facebook. I would like to see an obligation to “light up” rural areas as part of the new licenses. But if the companies cant raise money for their infrastructure then this may be a pipe dream.
Cash for Amendments Scandal
Readers of the Sunday Times will have followed the stories of MEPs being paid to submit amendments to EU laws. I’m glad that these MEPs have been sacked by their groups and are going to face criminal investigations in their own countries. I have never been offered money for an amendment nor would I accept it. I do consult companies, consumer groups, charities and others. I list all those “lobbyists” that I have met. I have submitted many amendments.
This week I tabled a number of suggested amendments to the new rules for “Deposit Guarantees”. Those who remember the Northern Rock crisis will also remember the flood of cash that went from UK bank accounts to Irish ones when Ireland announced it would guarantee unlimited deposits. There does need to be cross border agreement on the level of amount guaranteed but my amendments suggest that each different country should be allowed to chose how it will fund the payout. The proposal from Brussels is that a penny in every pound in a bank account is set aside in a slush fund just in case a bank fails - I’m not convinced that the UK economy can afford the side affect this “pre-funded” arrangement could have on lending capacity of banks. In the UK for example our banks are forced to contribute only if, or when, the money is needed. This should be a national decision not a Brussels one.
Putting an amendment on the table does not mean that it will come into law. First it needs to get majority support from MEPs across the parliament. Then it also needs to be accepted by a majority of the 27 national governments in the EU.
Offshore Oil Safety
This week I also hosted a 3 hour open meeting to hear from experts on the Safety of Offshore Oil. Given the importance of this to the UK I have volunteered to lead the Parliament’s report into this. We heard from industry players. Given the European Commission’s concern started during last years Gulf of Mexico incident I thought it was only appropriate that BP were asked to start the debate. We then heard from ENI of Italy regarding the Med - and especially interesting their North Africa experiences including in Libya, Statoil of Norway also spoke about the North Sea safety regime - which is in a totally different league to that which had existed in the USA. We heard from regulators including the UK. We learnt about the disaster response capacity that a European funded Agency has to help countries cope with spills from Oil tankers - including a fleet of clean up vessels and advanced satellite monitoring. I also invited environmental campaigners to tell us their views. It is clear that if a Gulf of Mexico type incident happened in a closed sea, like the Med, the impact would be much more severe.
We do need to continue to access our own oil resources but preventing a disaster from happening is a top priority. There seems to be consensus that the North Sea regulatory regime which looks at the risks involved in each individual well is a “gold standard” that other Seas should adopt. As an oil spill would obviously not respect territorial sea borders before washing with the tide, there is interest in working with coastal neighbours to ensure high standards are respected. I think the idea of an EU super regulator is waning (fortunately) but networks of peer reviews should help raise standards. I was invited to attend a meeting of the North Sea Offshore Authorities Forum where regulators from North Sea were joined by those from Italy, Cyprus, Spain and France (interesting as not a lot of offshore oil in France). They were having a healthy discussion on the challenges of extending the lives of older Oil platforms. I was pleased to hear that the Med is now going to start their own Authorities Forum, helped by the experiences of the North Sea and perhaps some North African countries will eventually join in.
There is also consensus that there needs to be much better equipment available to stop any leak as quickly as possible. The UK operators have already ordered a capping device which will be available for the North Sea and there may be room to use the European Agency to help pool clean up resources. We are also discussing ways to try to ensure that information regarding disasters or potential “near misses” is shared much more quickly across the globe - like, for example in the airline industry, so that there is the ability to learn about technical problems.