Examination of Witnesses (Questions 340-356)
19 MAY 2004
MR TOM
DELAY, MR
MICHAEL REA
AND DR
PETER MALLABURN
Q340 Mr Challen: Did you spend up your
entire budget in the last financial year and are you seeking an
increase in this one?
Mr Delay: Yes, we did.
Q341 Mr Challen: Are you seeking an increase?
Did you run a deficit or are you balancing the budget?
Mr Delay: Basically, we have to
get as close as we can to spending all of the monies allocated
to us, and clearly some of our activities are held within one
country's jurisdiction, other activities are spread across. It
is almost impossible to hit precisely the amount of money that
is allocated by the Scottish Executive, the Welsh Assembly, Northern
Ireland, and so on. To within a very small margin we have spent
all of our available funds last year, and we have made it clear
that we have the capacity to invest a significant, but not very
significant, increase on that next year. We do not believe it
would be appropriate to ramp up, as it were, on investment ahead
of our ability to deliver valuable and cost-effective savings.
Q342 Chairman: Can you give us a figure
for the amount by which you hope your budget will increase?
Mr Delay: Our overall budget has
increased by about 15%, between last year and this year. I have
not got the exact figures here.
Q343 Chairman: Can you remember what
it was last year?
Mr Delay: About £60 million.
It is about 69.
Mr Rea: Yes, it has gone from
about 60 to 69.
Q344 Chairman: How much of this comes
from the Climate Change Levy?
Mr Delay: Thirty-three. Again,
we can confirm those figures to you in writing, but I am pretty
sure it is 33.
Chairman: Thank you. That will be helpful.
Q345 Mr Thomas: I wondered if there was
a correlation between whatever the figure is and the carbon reduction
that you are seeking to achieve as well. If your budget is going
up 15%, is the target for CO2 reduction also 15%, or more?
Mr Delay: It depends whether you
are talking about carbon reduction in the short term or carbon
reduction in the long term. Certainly I think it is appropriate
to say that the carbon reduction in the short term should reflect
the increased budget in the activities that deliver carbon reduction
in the short term, absolutely. I think the danger is that we end
up chasing short-term benefit and we do not invest sufficiently
in the long term. We do have real concerns about meeting 2020
targets, about the UK's ability to look for 2020 targets, and
so it is important that we keep a balance. Essentially, that is
the key decision that our Board makes, in looking at our funding,
what the balance should be between the pursuit of relatively short-term
objectives and the medium term. At the moment, our resource is
balanced pretty much 50-50 between those two areas. You are absolutely
right, our targets for this year will reflect the fact that we
have an increase in funding over last year.
Q346 Mr Savidge: Is the funding you get
from the devolved parliaments and assemblies roughly proportionate
to what you are getting from the UK level, or how does it operate
exactly?
Mr Delay: That is a very complex
question, down to the legislation under which the funding is provided
is different, country by country. Yes, very broadly, the funding
is in proportion to originally the Barnett Formula and, going
on from that, an allocation of funding. It is not precisely that
year on year, because different administrations are able to provide
funding up to a certain level one year and not going forward.
That is the broad picture, and again we will be happy to provide
you with any details.[1]
Chairman: Thank you. That will be helpful
as well.
Q347 Joan Walley: Just picking up something
that Mr Challen said and, at the very outset, our Chairman said
about what more could be done, and Mr Challen was asking possibly
about Public Service Agreements. Can I ask you to comment about
the issue that you raised at the very outset about public procurement
and whether or not you are involved with the Round Table which
has been set up by Jacqui Smith, Minister at the DTI, looking
at public procurement, and whether or not you have got a direct
input into that, saying how carbon savings can be linked directly
to this whole debate which is taking place across Government on
public procurement policy?
Mr Rea: We are not linked into
the review directly per se.
Q348 Joan Walley: Do you think that you
should be?
Mr Rea: I think we should be,
yes.
Q349 Joan Walley: Have you made representations
about that?
Mr Rea: Today is the first that
I have heard about it. Historically, we have done quite a lot
of work on procurement both in terms of buildings themselves and
the equipment within buildings. We have been involved in previous
Government reviews, in terms of procurement, and I think we have
some good material in terms of how we would like to see this evolve.
I think we would want to be involved very much in this review,
in terms of sharing with both sides.
Q350 Joan Walley: Presumably, in terms
of the work that you are doing to advance the technology and change
the way of working, that could be geared very much into that Round
Table debate that the DTI are having?
Mr Rea: Absolutely. Government
procurement, in our view, is a lever which is very much underutilised,
both in terms of doing the right thing by Government's own stock,
as it were, but also in terms of having an influence on the market
more broadly. Also, I think, both in terms of existing energy
efficiency technologies and future renewable and low-carbon technologies,
if used in the right way they could be a very cost-effective way
of making a real difference.
Joan Walley: Chairman, maybe we could
ask the Carbon Trust if they could update the Committee on the
progress they make in contributing to that review?[2]
Chairman: Indeed; assuming that they
can get themselves in the door.
Q351 Joan Walley: I am sure that this
must help.
Mr Delay: I am sure it will. Thank
you.
Chairman: Yes. We look forward to hearing
of progress.
Q352 David Wright: I want to turn briefly
to the Sustainable Development Strategy and how you will contribute
to the review of the Strategy. Will you be submitting a memorandum
to Defra, for example? What is your overview on that review?
Dr Mallaburn: We have been approached
by Defra and we are happy to work with them in a limited way through
our programmes. In terms of engaging in any material way, I think
the answer is, no. I think our view of the Strategy is that currently
it is operating at such a high level as to be really an issue
that is beyond our remit. It is an extremely high level. In our
final analysis, the work we do probably is too detailed for it
to be put before the Committee.
Q353 David Wright: It causes me some
concern, in the sense that surely we should be drilling down priorities
from that kind of material into practical proposals that you can
implement, a small number of practical proposals which can feed
out of a strategy like that, which people like yourselves can
be implementing?
Mr Rea: I think you are absolutely
right. That is our view. I think what Peter was referring to,
in terms of the current framework, it is too high a level. Therefore,
actually to have impact you need to take it down to a level that
is actionable. I think, within the latest Government consultation
document, the area of climate change has a reasonable amount of
flesh around the bone about what is happening and what is being
done, but I think, over time, we can flesh it out more through
the Climate Change Programme review. I think, in some of the other
areas, they still remain at a very high level of abstraction.
Q354 David Wright: That means they will
not get implemented, does it not?
Mr Rea: Taking the business point
of view, I think one of the things about sustainable development
is that the Carbon Trust and the business world generally think
it is absolutely the right thing to do. The issue is translating
that into a language or a set of actions which, as businesses,
you can take forward. I think that is the challenge for us all
in terms of taking what is absolutely the right thing to do or
translating that into something that is actionable.
Q355 David Wright: Where will that happen
then and what forum will be used for you to meet in the middle,
if you like, with Government to formalise some targets and priorities?
Dr Mallaburn: In a sense, the
work that we do in our day job is linking the environmental pillar
of sustainable development with the economic pillar. I think that
works because we make it both tangible, which is Michael's point,
and in people's interest. We can have a debate with Government
about how it operates and the lessons that we learned, and we
have that debate with them now, but I think, as Michael said,
probably that will take place through the Climate Change Programme
review, which is looking at those issues in great detail. I think
the problem about making things relevant and in people's interest
is what we are about.
Q356 David Wright: You said you are going
to submit to Defra. Are you confirming that you are going to submit
to Defra on the review with some proposals?
Mr Rea: We have not taken a view
on that. As ever, we will talk to Defra informally and feed in
our thoughts and we will take a view on whether submitting a formal
consultation would add value beyond that in due course.
David Wright: I am sure the Committee
would be keen to see any submission that you would make, so that
we can match perhaps what you are putting in with what kind of
response comes out of the review, so that would be helpful.
Chairman: Thank you very much. I think
that concludes our questions. Thank you very much indeed, we are
grateful to you. There are a number of points arising which we
look forward to hearing from you about. Thank you.
1 Please see memorandum on Ev. 70-72 Back
2
Please see memorandum on Ev. 70-72 Back
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