Institutions and processes
82. We have pointed out above that the Strategy has
failed to drive policy making in the way initially hoped. Indeed,
whatever the weaknesses or strengths of the Strategy itself, the
issue of implementation is in many respects far more important.
A new strategy can only be more effective if the structure
of institutions and the processes they employ takes full account
of it. Structural and procedural aspects such as policy appraisal
mechanisms, departmental objectives, monitoring and reporting,
and the role of Cabinet Committees are therefore crucially important
if the Strategy is to be implemented effectively. The Government
did not include these issues in its consultation, but it will
need to take full account of them in developing its new approach.
DEPARTMENTAL STRUCTURES
83. Departmental structures are in themselves important.
When the present Government first came into office in 1997,
it created the Department of the Environment, Transport and the
Regions (DETR), with the primary objective of ensuring that environmental
objectives were fully incorporated within transport and planning
policies. This was reinforced by locating within the DETR the
cross-departmental Sustainable Development Unit, and above all
by appointing the Deputy Prime Minister as its Secretary of State.
When the DETR was broken up, Ministers and officials were confident
that the synergies gained from the co-location of these functionsin
particular, the shared awareness among staff of the sustainable
development agendawould not be lost.[68]
84. In practice, however, DEFRA's ability to promote
environmental and sustainable development objectives among other
departments seems to be significantly less than that of the DETR.
One might doubt, for example, whether the Aviation White Paper
would have taken the form it did had DETR survived. Moreover,
the decision to locate planning functions within the ODPM quite
separately from the sustainable development responsibilities of
DEFRA has also had an impact. In taking evidence, for example,
on our current inquiry on housing, we were astounded that DEFRA
had not been consulted on the terms of reference of the Barker
review.[69] Moreover,
the manner in which ODPM is pursuing its 'sustainable communities'
initiative with scant regard for any deeper understanding of what
a sustainable community would really amount to, suggests that
DEFRA is unable to ensure that its agenda is mainstreamed within
other departmental policies.[70]
Even within the context of the Greening Government initiative,
the abandonment of any attempt to monitor policy and awareness
issues also reflects DEFRA's waning power and limited resources.[71]
85. It is becoming increasingly clear that the
break-up of the DETR has had a negative impact as evidenced, for
example, by the failure to incorporate a deeper understanding
of sustainable development within the Aviation White Paper and
ODPM's 'sustainable communities' initiative; and by the limited
scope of the latest Sustainable Development in Government Report
where reporting on policy and awareness issues has been abandoned.
86. There has also been much discussion of departmental
structures in relation to energy policy over the last few years.
The DTI is responsible for strategic energy policy, while Climate
Change policy along with CHP and energy efficiency is located
within DEFRA, and transport within the DfT. A bewildering number
of related agencies and other bodies is also involved. In its
Energy Report (February 2002), the Performance and Innovation
Unit (now the Strategy Unit) commented that the existing structure
of institutions involved in UK energy policy making and delivery
lacked coherence.[72]
It recommended that the Government should aspire in the long
term to bring together in one department responsibilities for
climate change, energy policy and transport policy; and it envisaged
the creation of a cross-departmental unit as a transitional stage
on the route to such a department. This was one of a number
of recommendations in the PIU report which the Government has
not adopted.
87. Whilst we appreciate that there can be no
definitively correct organisation of departmental responsibilities,
it does seem to us that departmental structures can play an important
part in reflecting Government priorities. If sustainable development
is indeed an over-riding priority for the Government, there may
well be merit in drawing together responsibilities for energy
policy, transport and climate change in the way in which the PIU
envisaged; and rationalising the plethora of related bodies involved
in this area.
OBJECTIVES AND DUTIES
88. A related issue is the extent to which sustainable
development is built into the objectives of all organisations.
The 1999 Strategy stated that: "In future, whenever
the Government creates a public body, it will consider whether
to include sustainable development in its remit. It is reviewing
the scope for including sustainable development as an objective
of existing Departments and public bodies."[73]
89. While welcoming this commitment, we have on various
occasions expressed our concern that it has not been adequately
implemented. In 2000, for example, we concluded that the Treasury
were failing to build sufficient consideration of environmental
objectives into the remit of the Office of Government Commerce
and Partnerships UK.[74]
We have also pointed out how Ofgem's implementation of NETA entirely
failed to promote renewables and Combined Heat and Power in the
manner originally envisagedlargely because Ofgem considered
its role to be purely that of an economic regulator.[75]
Indeed, there is a widespread perception that Ofgem remains
an impediment to progress towards a more sustainable energy policy
due to the lack of a statutory duty to promote sustainable development.
90. Moreover, we have referred earlier in this report
to the Treasury's specious claim that its commitment to 'sustainable
growth' constitutes a commitment to sustainable development, and
in auditing the progress of the Treasury against the Statement
of Intent on Environmental Taxation we have previously expressed
our concern that its commitment to this agendasuch as it
isdoes not permeate its overriding preoccupation with economic
growth and productivity.
91. Various witnesses endorsed our view. The UK
Business Council for Sustainable Energy (UK BCSE) commented in
its memorandum that: "Recent experience in the UK energy
sector would suggest that not only does the definition of sustainable
development matter, but also, more importantly, its incorporation
in the terms of reference of market making institutions, such
as Ofgem, is vital if delivery is to be effective."[76]
David Green, the Chief Executive of the UK BCSE, reminded us
of the antipathy of the former electricity regulator, Clare Spottiswood,
to the incorporation of environmental objectives; and he also
made the interesting point that such a duty would allow Ofgem
greater scope to pursue environmental objectives without the fear
of judicial review.[77]
Meanwhile, at a local level, we noted that the consultants,
CAG, had recommended that ODPM should consider making sustainable
development a statutory duty of Regional Assemblies. In their
evidence to us, they pointed out that
"
it is particularly useful in Assemblies
that are not elected in the sense that they always have the problem
of legitimacy in dealing with other stakeholders. If they have
a statutory role to progress Sustainable Development I would think
it would give them more legitimacy in this area and would put
them on the same level as the RDAs, who do have it written in
there
".[78]
We would add that, even where sustainable development
is included, there is still an issue about the way it is formulated
and we believe that it could be further strengthened in the case
of RDAs.
92. We also noted that the Welsh Assembly Government
has a statutory duty to promote sustainable development. There
was some evidence that this had helped to raise the priority accorded
to sustainable development in policy terms, though the commitment
of ministers and senior officials and the relatively small size
of the administration were also material factors.[79]
93. The Government has failed to implement its
commitment to consider including sustainable development within
the remit and statutory duties of all departments and public bodies.
This has had particularly damaging consequences in both procurement
and the implementation of energy policy, where the incorporation
of such a duty within the Office of Government Commerce and Ofgem
would have facilitated more progress. In this context, we regret
the fact that the Government recently opposed amending the Energy
Bill so as to give Ofgem a primary duty to promote sustainable
development. As it is, we are disappointed with how little has
been achieved in these areas since 1998.
POLICY APPRAISAL SYSTEMS
94. But perhaps the most crucial aspect of mainstreaming
the environment in Government is the policy appraisal process.
Whether or not the Sustainable Development Strategy is successful
will largely depend on the approach taken by departments to evaluating
different policy options and assessing the trade-offs to be made
between economic, social and environmental impacts in the light
of Government priorities.
95. Since its inception, the EAC has frequently emphasised
the key role played by policy appraisal systems in relation to
sustainable development. We have expressed our concern about
the failure of departments other than DEFRA (and formerly DETR)
to carry out adequate screening and environmental appraisals of
policy initiatives. We have also commented on the plethora of
different guidance on appraisal and, in particular, the potential
conflict between approaches based on monetarising environmental
impacts and those based on non-monetarised approaches. We considered
these issues in our Greening Government 2003 report, and
included specific recommendations on the need for departments
to maintain and make public a central list of new policies and
the results of screening them for environmental impacts; and
on the extent of overlapping guidance and the need to adopt a
more coherent approach.[80]
96. Moreover, the Government's approach to appraisal
has shifted over the years and is still shifting. Some four
or five years ago, the emphasis was on the need for all departments
to conduct environmental appraisals where relevant. Subsequently,
the focus gradually shifted to the concept of integrated appraisals
covering all the potential impacts of a policy. There have been
various references to the Integrated Policy Appraisal (IPA) 'tool'
to assist departments - though as we have previously pointed out
the guidance on IPA was little more than a reminder to departmental
staff that they must carry out various other forms of appraisal
where relevant. Over the last year, the focus appears to have
shifted again, and the Government now views the Regulatory Impact
Assessment (RIA) as the main vehicle for appraising policy impacts.
Responsibility for developing initiatives in this area has also
shifted amorphously between DETR, the Cabinet Office, and DEFRA.
97. Yet throughout this period, there has been little
improvement in the performance of departments. The 2001 Green
Ministers Report stated that "it is somewhat disappointing
that, despite promotion of environmental appraisal, inclusion
in the Policy Makers Checklist and screening systems put in place
by departments, relatively few departments beyond DETR have produced
published environmental appraisals.
The reasons
for the apparent lack of progress on environmental appraisal will
be investigated as part of a review of progress with development
of integrated appraisal systems in the next year."[81]
Yet the next annual report contained nothing other than
the banal statement that many departments considered appraisals
as a part of the wider decision making process and that keeping
a log of appraisals was not a useful indicator of how well the
department considered environmental issues.[82]
98. The Government response to our Greening Government
2003 report commented that "the IPA tool has the potential
to support better policy making and joined up government but it
also highlighted issues that would need to be resolved if it were
to be used more widely. In particular, it reaffirmed the need
to clarify the way in which the IPA relates to other policy appraisal
systems including the mandatory RIA and the need to provide clearer
central support and guidance for policy makers."[83]
There is an urgent need for such clarification: as we
have pointed out in our latest report on aviation,[84]
the DfT appear to view the IPA as a brief summary of impactsrather
than as the tool which enables policy makers to justify the trade-offs
they are making between economic, social and environmental goals.
99. Departments can play a key role in turning
the Sustainable Development Strategy from an illusion into reality
through the way in which they evaluate new policies. The Government
should take account of our previous recommendations in this area
and ensure that appraisal processes take sufficient account of
environmental priorities. In this respect, Regulatory Impact
Assessments may not be adequate, and the Government should therefore:
- rigorously implement the
requirement that departments should maintain a central record
of the results of screening new policies, and conduct integrated
policy appraisals and separate environmental appraisals where
justified;
- require all appraisals to incorporate specific
consideration of key environmental objectives, such as the need
to reduce biodiversity loss and to achieve the 60% carbon reduction
target;
- ensure that appraisals are conducted sufficiently
early to inform choices between different policy options, rather
than as a means of justifying the chosen option; and
- ensure that appraisals incorporate an in-depth
discussion of any conflicts between economic, social and environmental
objectives, and of the basis on which policy decisions are to
be made.
CABINET COMMITTEES: ENV AND ENV(G)
100. In both our Greening Government 2003 and
our Greening Government 2004 reports, we have commented
on the role of ENV and ENV(G). We questioned what role ENV actually
played, and how clearly its role could be differentiated from
that of ENV(G). In commenting on the reduced scope of the Government's
Sustainable Development in Government: First Annual Report
(November 2003), we also expressed our surprise that ENV(G)
had sanctioned such a change and queried whether it now saw its
role as limited to evaluating operational performance. The rules
of Cabinet confidentiality now mean that we know nothing about
the way in which ENV or ENV(G) function. It is not even clear
how many times each of these Committees has met, nor what issues
have featured on their agendas. We consider this unfortunate,
and indeed CAG contrasted the position here with the transparency
and openness which obtains in the Welsh Assembly.[85]
101. While ENV no doubt plays a primary role in
implementing major environmental initiatives, we suspect it is
failing to play any decisive role in influencing wider policies
across government in order to ensure that they are based on a
more fundamental understanding of the concepts of sustainable
development. Similarly, it is unclear whether ENV(G) now has
any role in greening policy, and on what basis it can assess departmental
performance in this respect. Since these two Committees ought
to be playing a key role in implementing the Strategy, it would
be helpful if the Government could provide more information about
their activities.
INTERNATIONAL FRAMEWORKS
102. Many of the challenges we now face in addressing
environmental issues are of an international nature. Over the
last 20 years, a variety of multilateral environmental agreements
(MEAs) have been negotiated to deal with specific problemssuch
as the destruction of the ozone layer and the protection of endangered
species. The action now required to address global warming,
in particular, raises major issues of international competitiveness.
We have seen, for example, how the rebate on the Climate Change
Levy was increased to protect British industry; while the Government
has argued that action to address the impact of aviation emissions
can only be taken on an EU or international basis.
103. Within the international community, the UK
has taken a lead in certain respectsnotably by setting
the 60% carbon reduction target for 2050. In practice, however,
the huge cuts in carbon emissions which developed nations will
need to make in order to address global warming can only be envisaged
in the context of an international framework which has legal force
and can be rigorously implemented.
1