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Conservative Party Conference 2017: Wednesday 4 October

Michael Zdanowski and Tom Reynolds from Madano’s Energy team attended the Conservative Party Conference, which has now closed with the delivery of Theresa May’s keynote speech to delegates.

Here’s Tuesday and Wednesday's round-up of news on major speeches, energy and infrastructure policy, Brexit-related discussions and other developments.

Please see below a summary of:

  • Key speeches from Tuesday and Wednesday – David Davis, Liam Fox, Boris Johnson, Theresa May 
  • Madano conference diary – Michael Zdanowski, Head of Energy
  • Tweets of the day

Speeches

David Davis – Brexit Secretary

  • Mr Davis emphasised the Government’s desire to focus on building a global hub of free trade, securing the benefits of a strong global economy for the UK.
  • He highlighted the benefits of an independent trade policy which will allow the UK to lead a “race to the top” and boost global standards and productivity.
  • Mr Davis stated that the UK seeks to be a “good global citizen”, paying its way and contributing more than the EU average to coordinated defence and international development efforts.
  • He suggested that a new sense of optimism is evident across the UK, as people begin to realise the potential benefits of leaving the EU.
  • The Secretary of State is committed to delivering Brexit and enabling the UK to move forward as a successful, outward-facing country, noting that the Government will not allow opponents to “wreck” the European Union (Withdrawal) Bill.
  • He criticised the Labour Party for opposing the Government’s implementation of Brexit and for a perceived failure to ignore the detailed “technicalities” involved in leaving the EU.

Madano analysis: Mr Davis’ speech was overshadowed by reports suggesting that he could be planning to retire in the summer of 2019, therefore choosing not to stand in a potential leadership election post-Brexit – reports later denied by Prime Minister Theresa May. He called for the UK to ignore “lurid” media headlines, suggesting that negotiations with the EU are going poorly and urged his Party to “keep [its] eyes on the prize” to deliver Brexit in a “smooth and orderly” manner.

Dr Liam Fox – International Trade Secretary

  • Dr Fox spoke about how his department had progressed since last year’s conference, at which point it had only been in existence for two months, and stated that it was designed to meet the trade challenges of the 21st century.
  • He outlined his vision for a “UK that trades its way to prosperity, stability and security” and to achieve this the UK must champion free trade. After Brexit, the UK would be able to “take full advantage of having an independent trade policy for the first time in over 40 years”.   
  • Throughout the speech, Dr Fox sought to strike a positive tone, and was critical of “naysayers” who had “gotten it wrong” about Brexit. He listed several positive economic developments since the referendum including high levels of inward investment and exports.
  • He dismissed Labour’s economic offering as “economic incompetence, financial incontinence and self-congratulatory nonsense” and as a “confidence trick” which would place the next generation in debt.
  • The Secretary of State detailed the work his department needed to undertake upon the full withdrawal from the EU, including tabling new trading schedules with the WTO, translating into UK law the 40 trade agreements that the EU has with other countries, and looking at new trade agreements.
  • He reaffirmed the UK’s desire for a “full and comprehensive agreement with the EU, retaining an open and free trading area across the European continent”.
  • He argued that free trade had directly benefited consumers, and protectionism led to higher prices, less choice and a less competitive economy with lower standards of living.

Madano analysis: Dr Fox’s speech was somewhat distinct from his Cabinet colleagues, in that he did not spend a large amount of time focused on Labour and the tone of the speech was considerably more optimistic than others such as Philip Hammond. Instead, the speech sought to put forward a positive view on the opportunities of Brexit. He also spent a lot of time discussing what his department has already done and would do to deliver the international trade opportunities sought by the Government.

Boris Johnson – Foreign Secretary

  • Mr Johnson criticised what he perceives as an overly pessimistic impression of Brexit being given the UK media and by the opposition Labour Party, suggesting that the UK should “be bold” and seize the opportunities of leaving the EU.
  • He underlined the message of Prime Minister Theresa May that the UK will continue to be a “strong partner” to the EU and seek to build the country up as a hub of free trade.
  • He also noted that the UK is the premier destination for investment into the EU. 
  • Mr Johnson suggested that the world will one day be able to generate “as much clean energy as it wants” and face down the challenge of climate change.
  • He stressed that global policies must encourage and empower innovators to find new challenges, suggesting that the UK is the world’s capital of innovation.
  • The Foreign Secretary highlighted the benefits of UK action to bolster global security, noting that this allowed British goods to more easily be traded around the world.

Madano analysis: The Foreign Secretary has appeared to break ranks with the Cabinet in recent days, laying out his “red lines” on the UK’s negotiations with Europe in a series of newspaper articles. Amid suggestions by some that he should be sacked by the Prime Minister, Mr Johnson’s speech was well-received in the Conference Hall and echoed messages expressed by other ministers such as Priti Patel and Philip Hammond. He was clear that a post-Brexit future should be one that encourages international trade and innovation to tackle major challenges such as global warming. 

Theresa May – Prime Minister

  • The Prime Minister’s speech argued that the “British Dream” of ensuring that the next generation has it better than the one before needs to be “renewed” for a new generation. 
  • Mrs May apologised for failings in the party’s General Election campaign, describing it as “too scripted and presidential” with “no message of change”. She praised her Cabinet as united in “tackling the issues of the future together”, including climate change.
  • While defending the record of the previous Conservative and Coalition governments, Mrs May warned that all governments must develop a new agenda for the country.
  • Mrs May stated “we must get Brexit right” and rejected the notion that Brexit represents an insular retreat within our borders. Instead, the UK will have a global outlook and actively pursue new free trade deals around the world.
  • She reaffirmed her desire for a strong partnership with EU, and said that EU citizens in Britain “were welcome here” and “we want you to stay”.
  • The Prime Minister pledged to reform “failed” free markets, dedicating her premiership to “fixing the housing crisis”, including support for ‘help to buy’ outlined by the Chancellor and a further investment of £2 billion in affordable housing.
  • She argued that the energy market is “broken” and punishes consumer loyalty with higher prices; a draft bill will be put forward next week to put a price cap on energy bills.
  • She also suggested that reform of education and skills training is needed to meet the UK’s productivity gap, promising to boost the number of free schools by 100 each year.
  • May criticised Jeremy Corbyn’s economic policies and claimed that it was politicians who promised “the earth with no means of delivering” is what fuels disillusionment with politics.

Madano analysis: May’s speech was a personal one, in which she sought to face critics who have described her as emotionless and without ideas or vision. The speech attempted to refocus the Conservative Party, which critics have said has lacked a coherent policy direction following the disastrous election result this year. Her speech will be seen as an attempt to shore up her leadership.

Pledging action to tackle a perceived crisis in the UK’s retail energy market through an energy cap, Mrs May did not provide any detail as to which tariffs would be affected, or how many consumers would benefit, but stated that the bill would meet the manifesto pledges made earlier in the year.  

Madano Conference Diary – Michael Zdanowski, Head of Energy

Tuesday saw a number of energy and industry focused events at the Conservative Party Conference in Manchester.

The ‘affordability of energy’ was a major topic of conversation at a number of events including an IPPR event titled ‘Will simpler energy bills get consumers a better deal?’

The panel included the FT's Natalie Thomas and John Penrose MP and concluded that the UK's energy market is broken. There was panel consensus that market intervention was a realistic and logical short-term solution to a market that has failed to deliver for millions.

Monday's focus on the Industrial Strategy continued into Tuesday. At a Policy Exchange event, Richard Harrington, Minister for Energy and Industry, reiterated the rationale of the Industrial Strategy and stated that at its core is "our energy strategy".

The profound transformation of our energy system was summed up well by Nicola Shaw of National Grid, who stated that earlier this week the UK enjoyed a record 29 hours without using coal as a result of strong winds across the UK.

Attendees at the Policy Exchange event were left in no doubt as to the depth of energy solutions available to Government as discussion extended to small modular reactors, carbon capture and storage, wind and solar, and energy storage.

Switching, or rather the lack of switching, among UK retail energy consumers was the central topic of a Scottish Power hosted event which saw the launch of a new report from the Social Market Foundation (SMF) think tank.

The report titled 'Stick or Switch’ includes impressive analysis, graphs and facts on the reasons behind the lack of consumer engagement.

At the event James Kirkup of the SMF called for a reduction of the number of customers on standard variable tariffs (SVTs) to 30% by 2020.

Finally, at a Nuclear Industry Association (NIA) fringe event held Tuesday night, Business Secretary Greg Clark talked openly to the Spectator’s James Forsyth about the Industrial Strategy.

Greg Clark highlighted the urgent need for an Industrial Strategy in the UK to address the lack of productivity in the country compared to the U.S., France, Germany and Italy.

As Clark put it, the UK is “not the earnings capital of the world… that’s what we’re addressing in the Industrial Strategy”. Among other things, Clark talked about the skills shortage in the UK and expressed his hope that engineering in the UK will one day be seen as prestigious as it is in other countries.

On the affordability of energy, Clark was adamant that Government intervention in the market was very real and that it would be “of benefit” to consumer bills.

Best tweets

Joe Ware, News and Emergencies Communications Manager, Christian Aid (@wareisjoe)

"EVs will be the game changer that will make consumers aware of their household energy use" @JSHeappey at @Policy_Exchange #CPC17 fringe

Tim Rotheray, Director, Association for Decentralised Energy (ADE)  (@trotheray)

Very refreshing: @beisgovuk minister Claire Perry say we must move beyond switching when we discuss consumer engagement in energy #CPC17

Doug Parr, Chief Scientist, Greenpeace UK (@doug_parr)

Nicola Shaw, Chief Exec of National Grid, says last night had fossil fuels (gas) providing just 11% of power, lowest C intensity ever #CPC17

Toby Brown, Campaigns and Public Affairs Manager, Citizens Advice (@T0B0)

.@VicMacG123 '3000 people come to @CitizensAdvice each day for help with an energy issue' @eonenergyuk @Policy_Exchange #cpc17

Tim Stanley, Journalist, Daily Telegraph (@timothy_stanley)

As well as the cough, she’s spoken about her childlessness & illness. The most “robotic” PM has given the rawest speech #CPC17

Norman Smith, Assistant Political Editor, BBC News  (@BBCNormanS)

If we can't get a Brexit deal then we are ready for NO deal – David Davis #cpc17

Emily Gosden, Energy Editor, The Times (@emilygosden)

Government RNS confirms the energy price cap will apply to customers on standard variable tariffs (i.e. 15m homes): https://www.investegate.co.uk/dept-busenrg

Jillian Ambrose, Energy Editor, The Daily Telegraph (@JH_Ambrose)

So much said at #CPC17 on strides made in energy and the opportunity for innovation in the future. All under threat by cynical price cap

National Housing Federation (@natfednews)

Prime Minister tells #CPC17 that the Government will invest an additional £2bn in affordable housing #UKHousing

No 3rd Runway Coalition (@NoR3Coalition)

PM claims Gov’t is “leading the world in tackling climate change” but supporting Heathrow Expansion just makes that claim laughable #CPC17

Caroline Lucas MP, Co-Leader, Green Party of England and Wales  (@CarolineLucas)

.@theresa_may says Britain leads the world on #climate. Yet when Trump pulled out of Paris deal the Government was near-silent. #CPC17