Key Facts

• Amendments 19, 20, 21, 40, 41, 42, 43, and 44 are proposed to strengthen clause 34.
• Amendment 19 changes “may, in particular” to “must” to ensure that certain information is included.
• Amendments require the inclusion of the date subsidies were entered into the database and additional necessary details.
• Clause 34 concerns technical details about uploading subsidy information to a database.
• Regulations for the database upload requirements will be made by the Secretary of State through secondary legislation.
• The Government aims to ensure that the data fields included in regulations are useful and appropriate, avoiding unnecessary administrative burdens.
• The regulations are described as highly technical and do not change substantive subsidy control requirements.
• The database is already operational without specific requirements in force.
• Public authorities must understand what regulations will require them to do.
• Clause 34 gives the Secretary of State power to make regulations for information provided by public authorities on subsidy schemes.
• Budgeted amounts can be included in regulations but may vary significantly from final subsidies, particularly for tax measures.
• Clause 35 exempts certain types of subsidies from the framework, including lower value subsidies with minimal distortive impacts and monetary policy subsidies to maintain Bank of England's independence.
• Clause 37 sets out procedural requirements for awarding subsidies under the minimal financial assistance (MFA) exemption.
• Before awarding an MFA subsidy, a public authority must provide an MFA notification to the intended beneficiary requesting confirmation that they will not exceed the £315,000 threshold over three years.
• The public authority can only award the subsidy when it receives this confirmation from the enterprise.
• The clause outlines procedural requirements attached to subsidies given under the clause 36 exemption.
• Public authorities must provide a notification stating they cannot award a subsidy until confirmation is received from the intended recipient.
• The MFA notification does not need to be published, but Seema Malhotra suggests reconsidering this for transparency.
• The clause establishes an exemption for subsidies up to £725,000 awarded for delivering services of public economic interest (SPEI).
• Services of public economic interest are public services that would not be delivered by enterprises at the necessary level without subsidy.
• SPEI assistance is exempt from subsidy control requirements if the amount does not exceed £725,000 over a three-year financial period.
• Clause 41 exempts certain services of public economic interest subsidies from the obligation to upload to a subsidy database.
• Subsidies under £14.5 million given to SPEIs are exempt from publication on the database.
• The clause outlines specific activities that are exempt from transparency obligations, including hospital care and social housing.
• Amendment 45 seeks to add provisions to clause 42.
• The amendment requires seeking consent from devolved administrations for regulations under subsection (1).
• If consent is not given within one month, the Secretary of State may proceed without it but must publish a statement explaining why.
• The Government is considering whether to set a different threshold for agricultural subsidies compared to other types of subsidies.
• There have been 34 official-level and 10 ministerial-level engagements with devolved Administrations on the Bill.
• The Subsidy Control Bill will be subject to legislative consent motions.
• Amendment 46 allows Scottish Ministers, Welsh Ministers, and Northern Ireland departments to request that the Secretary of State declare a natural disaster or exceptional circumstance.
• If the Secretary of State refuses such a request, he must make a statement outlining his reasons to the House of Commons.
• Natural disasters are often regionally specific rather than affecting the entire UK.
• The clause enables subsidies without adhering to usual subsidy control requirements.
• Subsidies awarded under the clause are exempt from principles, prohibitions, but transparency rules apply.
• Notice declaring exemption must be laid in Parliament.
• Amendment aims to exclude transparency requirements for specific types of subsidies.
• Exemptions include agriculture, fish products, and the audiovisual sector.
• The amendments relate to Part IV or Annex 2 of the Agreement on Agriculture.
• Amendment 47 aims to require the Secretary of State to make a statement regarding Article 10 applicability on the date the Act is passed.
• There is significant uncertainty about which subsidies and schemes are subject to the Northern Ireland protocol.
• The amendment seeks clarity for public authorities in Wales, Scotland, England, and Northern Ireland.
• Amendment 47 would require the Secretary of State to make a statement regarding the applicability of Article 10 of the Northern Ireland Protocol.
• The BEIS guidance on Article 10 was published on 31 December 2020 based on the EU Commission’s unilateral declaration of 18 December 2020.
• Section 48 of the United Kingdom Internal Market Act 2020 requires statutory guidance to be published for the practical application of Article 10.
• Businesses face potential legal challenges due to unclear application of subsidy regimes.
• Two sets of guidance and legal opinions exist, leading to confusion over which regime applies.
• The Government's failure to provide clear answers undermines the operation of the subsidy control regime.
• Clause 51 of the Subsidy Control Bill establishes provisions for subsidies related to nuclear projects.
• Nuclear projects are exempt from assessing against additional energy and environmental subsidy control principles but must assess against main principles in schedule 1.
• Further legislation concerning nuclear investment will be introduced tomorrow.