Examination of witnesses (Questions 100-119)
WEDNESDAY 14 MARCH 2001
MR STEPHEN
TIMMS MP, MR
CLIVE MAXWELL
AND MR
JOHN HALL
100. It would be very useful if we could have
a copy of that.
(Mr Timms) I will certainly do that.
101. Could I just touch on an issue which I
think was a point we raised at your previous visit to the Committee,
the question of the Office for National Statistics and their indicators
for green taxation. We had this debate before and I would like
to push this again. Given what you have said about the Treasury's
commitment as an institution, would it not be very useful if we
could get the ONS to develop a more useful indicator of green
taxes? This does seem to us to be a hole in the overall policy.
There seems to be a mysterious reluctance on the part of the Treasury
to push the ONS in that direction.
(Mr Timms) We had an exchange about this earlier on
this afternoon as well. I made the point then that I do not think
the percentage of total taxes which are environmental is a good
indicator because it is not clear whether that going up is a good
thing or a bad thing, so while actually it has gone up I am not
sure how much one can read into that. Increasingly we are going
to need to carry out very careful evaluation of measures that
we have introduced and to see whether the environmental benefits
that we expected from those measures have actually been achieved.
With such a lot of environmental tax measures taking effect recently
and in the near future there is quite a lot of work that we will
need to do and we are committed to doing that. I think that is
the answer, to monitor effectively how successful we have been.
102. Has that process stopped yet or are you
flagging up the fact that this will start to take place in the
next few months?
(Mr Timms) We have done a good deal of planning for
this. I made the point earlier on that on the company car tax
changes that are coming in the Revenue has put in a good deal
of work to plan how we can see whether the million tonnes of CO2
emissions reduction that we expect from that is achieved. I think
we are going to need to do similar pieces of work with other measures
too.
103. On a similar point, in terms of the advice
you gave to departments following last year's Spending Review
in respect of sustainable development policies, has there been
any follow-up to that? Has there been any monitoring of what individual
departments are doing and how they are implementing their responsibilities
in this respect?
(Mr Timms) I think the monitoring, certainly in the
first instance, will need to be carried out by the departments.
Having signed up to the PSAs it is for them to monitor how they
progress. Of course there will be a process centrally reviewing
progress as well but the primary responsibility rests with the
departments.
104. Has the second instance process started
then in terms of you exercising your supervisory role over departments'
work? Is that in place? Will that happen?
(Mr Timms) We have not yet started the three year
period, that begins at the beginning of the new financial year.
We have not quite got there.
105. But there will be mechanisms in place by
which departments will be monitored in this area?
(Mr Timms) Yes.
Chairman
106. Just to come back to this point about shifting
the tax burden in Public Service Agreements. In your previous
PSA for the Treasury you did have a target for shifting the tax
burden and also Customs and Excise and the Inland Revenue had
such a target but this is not in your new PSA, there is no target
at all mentioned. Is that because you have intellectual doubts
about the sense of this, as you have just indicated, or is it
some other omission?
(Mr Timms) There certainly has been no stepping back
at all from the sustainable development commitments that we have
entered into which are very firmly built into our work.
107. I appreciate that, but shifting the tax
burden, which we were concerned about, that was a target in your
previous PSA but not in your new PSA and I wonder why that is?
(Mr Timms) What I would say is that I do very much
see that as part of the sustainable growth commitment that we
have been talking about and is in our objectives. It does very
much imply that process we have put a huge amount of effort into
and are continuing to put a huge amount of effort into to deliver.
108. I am wondering why it has been dropped?
The specific target that was there is no longer there. Why has
it been dropped and can it be replaced?
(Mr Timms) There was a process and a conscious aim
in the PSA round this time to reduce the number of targets and
to shorten the—
109. So it is a victimisation of simplification.
(Mr Timms) I hope nothing has been lost by the process.
110. It clearly has.
(Mr Timms) Certainly there are not as many words as
there were first time around and I think that is an improvement
rather than a loss.
Joan Walley
111. I would like to endorse what Mr Chaytor
was saying about the importance of clarifying the difference between
"sustainable growth" and "sustainable development".
I do feel that maybe that is a job for the Green Ministers, to
make sure that the language in which the Treasury expresses itself
is not committed to growth per se but takes account of
the sustainable development argument that we want to see at the
heart of policy. Can I just ask you about your role as the Green
Minister for the Chancellor's Department, which I understand includes
the Inland Revenue and Customs and Excise. How many meetings have
been you been to this year?
(Mr Timms) I have been to two of the meetings.
112. Out of how many?
(Mr Timms) Out of four.
113. Did you send a substitute?
(Mr Timms) An official was present when I was not.
I should say in self-defence that one of the meetings was on the
morning of the Pre-Budget Report, so that was obviously a difficult
one for me to attend.
114. I think you could be forgiven for that.
(Mr Timms) Thank you very much.
115. We do not know how they work from outside
and we want to get a flavour of how the Green Ministers Committee
is actually changing things. Have you brought any best practice
away from what you have seen in other departments back to the
Treasury?
(Mr Timms) Yes. What tends to happen is that there
is a presentation from one of the departments that are present.
I think I am right in saying that at the two meetings I have attended,
both of which I found very valuable, at one there was a presentation
on the part of the Home Office and at the other there was a presentation
on the part of MAFF. For example, the sort of thing that happens,
I guess, is part of the MAFF presentation dealt with work on energy
crops which tied in very closely with the work that we were doing
on the Green Fuel Challenge. That was very useful, to make that
connection, and I subsequently had a discussion with the Minister
involved. I see it as a very useful way for joining up efforts
across Government to tackle all these issues. I certainly had
not appreciated before that presentation the scale of the work
that the Ministry of Agriculture, Fisheries and Food was doing
on that and it was a valuable thing to know for my work as well.
116. Can I just follow on from that. Arising
out of that, what consideration did you give to agriculturally
supplied fuels? Do you feel that they should be given parity with
fossil gas fuels in the Budget? Do you feel that the Green Ministers
Committee can be a forum whereby, if you like, you can get parity,
you can deliver on whatever issues are raised during the course
of the Green Ministers meetings?
(Mr Timms) Do you mean duty parity?
117. Yes, in terms of tax. It is interesting
that you happened to give the MAFF presentation as an example
of good practice. It seems that there are still so many things
whereby we need to be much more joined up so we are not discriminating
against some fuels that could be environmentally produced by MAFF
to move towards a more sustainable route.
(Mr Timms) Certainly MAFF, as I learned on that occasion,
has an interesting, quite an ambitious programme on energy crops.
In terms of decisions about levels of duty, of course they are
a matter for the Chancellor.
118. You are the Chancellor's Green Minister,
are you not?
(Mr Timms) I am, yes, indeed. It is for the Chancellor
to decide on the basis of a recommendation from me because I am
the Minister who deals with these matters directly at the Treasury.
We did announce a significant duty incentive for bio-diesel in
the Budget, 20 pence a litre. I know from what people have said
to me since the Budget, and indeed before the Budget as well,
that that will be a significant incentive for the take-up of bio-diesel
as an alternative fuel.
119. I think it is unfortunate that you mentioned
the MAFF meeting because we have had a letter from the British
Association for Bio-fuels and Oils and they are tearing their
hair out because they feel that MAFF has not actually recognised
the environmental issues on a level that they would have liked
them to have done.
(Mr Timms) Let me come on to that. I also receive
a large number of letters from the British Association for Bio-fuels
and Oils and I met Mr Clary, who I imagine would be the signatory
of that letter, as part of the process of the Green Fuel Challenge.
I have not spoken to him since the Budget but I think he will
have been pleased by the announcement we made in the Budget on
bio-diesel. I discussed with MAFF Ministers the right approach
to this as part of that decision and I want to defend them. I
think this was a good piece of joined up work that we put in together
with a good outcome from everybody's point of view.
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