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House of Commons

Thursday 15 December 2005

The House met at half-past Ten o'clock


[Mr. Speaker in the Chair]


London Local Authorities and Transport for London Bill (By Order)

Read the Third time, and passed.

Oral Answers to Questions


The Secretary of State was asked—

EU Sugar Regime

1. Mr. Peter Bone (Wellingborough) (Con): If she will make a statement on the future of the EU sugar regime. [37687]

4. Miss Anne McIntosh (Vale of York) (Con): What recent representations she has received on the EU sugar reforms. [37691]

The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Jim Knight): As you know, Mr. Speaker, my right hon. Friend the Secretary of State is attending the World Trade Organisation talks in Hong Kong. Under the Secretary of State's chairmanship, the European Union Agriculture Ministers reached an historic agreement to reform the sugar regime, which has remained largely untouched for the previous 40 years. Reform of the sugar regime was a key priority of the UK presidency.

Mr. Bone: I thank the Minister for his response, but does he agree that the sugar regime demonstrates everything that is wrong with the European Union? Consumers in the EU pay three times the world price, EU taxpayers pay £1 billion a year and, worse still, farmers in the EU dump their product on developing countries, destroying local farming. Is the reform not a case of too little, too late?

Jim Knight: I was just about to say how much I agreed with the hon. Gentleman, as I concurred with all the reasons why it was important to reform the sugar regime. However, the reform is good for consumers and taxpayers because it will reduce prices and halve the current €7 billion a year cost. It is good for jobs, given that we lost 16,000 food processing jobs while sugar
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prices were three times the world price, and it is good for growers, because it ends the scandalous distortion under which EU growers receive only £1 for every £5 spent to support them. That is why it has been broadly welcomed by most key UK interests, that is why Tate & Lyle's share price soared after the deal, and that is why it should be welcomed in the House.

Miss McIntosh: The British farmer is not frightened of change, as the Minister knows, but he is only too aware of the pace of change, particularly the question of the rate of compensation and which growers will receive it. Can the Minister explain the future of the British Sugar factory at York, and what alternative break crop is available to arable farmers if the demise of sugar beet takes place?

Jim Knight: As I said, the deal offers the EU big sector sustainability and long-term certainty. The Commission estimated that twice as many jobs would be at risk from failure to reform as from the market-based approach that has been agreed. Farmers will receive more than 60 per cent. compensation for the sugar price cut through the single farm payment, including recognition of the UK's deficit area status. Consultation will take place with the industry on the exact way in which the compensation will be paid. The future of the sugar factory in York is in the hands of the market.

Paddy Tipping (Sherwood) (Lab): I congratulate the Minister and his colleagues on reform of the sugar regime, which shows that, with commitment, reform of the common agricultural policy can take place, although it needs to go further. As there are consequences for both producers and processors, will the Minister publish details of the scheme as quickly as possible so that decisions about future planting, the operation of the market and its effect on the British Sugar factory in Newark can be made?

Jim Knight: I am sure that as soon as we have the details requested by my hon. Friend, they will be published.

David Taylor (North-West Leicestershire) (Lab/Co-op): Could the Minister say a little about the impact on African, Caribbean and Pacific countries—especially Guyana, where 35,000 people work in the sugar industry, on which they and their families are heavily dependent? The anticipated changes will reduce their national income by about $40 million per year, which wipes out by a factor of five the $8 million from which they have benefited in G8 debt relief. Will the Minister address the problems experienced by Guyana?

Jim Knight: The UK shares my hon. Friend's concerns and we accept that the deal will reduce prices received by our traditional African, Caribbean and Pacific suppliers and reduce the attractiveness of the EU market for least developed countries. However, EU prices will still be at twice world levels and preferential access will still be guaranteed under the terms of the existing sugar protocol. Contrary to certain reports, the deal contains no new import restrictions. In addition, ACP countries will benefit from a two-year delay in price cuts. The amount of aid has still to be determined
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and cannot be settled until the new EU financial perspectives are agreed. The UK is pressing for at least €250 million a year over seven years.

Mr. Henry Bellingham (North-West Norfolk) (Con): As the Minister knows, contrary to popular myth a large number of the growers in East Anglia are not large estates or large farmers. They are smallholders and small farmers and they are a vital part of the rural economy. Will the deal protect their specific interests?

Jim Knight: Certainly, as the details of the compensation are worked out, we will have in mind the hon. Gentleman's constituents—the small farmers who play an important role in the rural economy. Until the details have been agreed, it is difficult for me to add any more.

Climate Change

2. Simon Hughes (North Southwark and Bermondsey) (LD): If she will make a statement on progress towards meeting climate change targets. [37689]

The Minister for Climate Change and the Environment (Mr. Elliot Morley): The UK expects to exceed its Kyoto commitment by about 8 percentage points. The UK is committed to moving beyond our Kyoto protocol target and towards our national goal to reduce UK carbon dioxide emissions by 20 per cent. below 1990 levels by 2010.

Simon Hughes: Everybody will be pleased at the progress made over recent days in Montreal, but from the written answer that the Minister gave my hon. Friend the Member for Lewes (Norman Baker) on 29 November at column 312 on greenhouse gases, it looks as though we will not have met our targets over the past two years. To make sure that we can all have confidence that we are going in the right direction, will the Minister agree to annual targets from now on, independently assessed and adjudicated? That way, we   would know that there was no spin and no dishonesty.

Mr. Morley: I agree with the hon. Gentleman that it was a tremendous outcome at the Montreal talks. My right hon. Friend the Secretary of State deserves a great deal of credit and she was much admired for the way that she led the whole EU delegation. Let me make it clear that there are two targets. First, there is our Kyoto target, which is legally binding and which we are well on track to meet and, as I said, to exceed. Then there is our domestic voluntary target of 20 per cent., which we are not on track to meet, but we are having the climate change review in order to ensure that we do so. As regards independent monitoring, the inventory is already independently monitored by the National Environmental Technology Centre, the United Nations framework convention on climate change and the National Audit Office. On individual targets, reductions in CO 2 have been up and down in different years, but we are willing to consider any suggestions that the hon. Gentleman may have.
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Mark Lazarowicz (Edinburgh, North and Leith) (Lab/Co-op): It was indeed a considerable achievement to obtain a Montreal agreement, which I notice Friends of the Earth described as an "historic agreement" that would "strengthen global resolve". The Secretary of State deserves slightly more enthusiastic praise than we heard from the Liberal Democrat Benches. In the spirit of consensus that affects us all nowadays, will my hon. Friend give us an idea of how he intends to build upon the agreement at Montreal, which was a major step forward but will clearly require a great deal of work, at European level in particular, to take it forward?

Mr. Morley: My hon. Friend is right, and there will be further opportunities to discuss the Montreal outcome. It gives us effective rules for implementing the Kyoto protocol, agreement on new targets and frameworks post-2012 and a global approach based on the convention, incorporating all signatories to the convention including non-Kyoto signatories—among them the US and Australia.

Mr. James Gray (North Wiltshire) (Con): I hope that one day I will have the opportunity to answer the questions, but on this occasion I shall just ask a question. The Sustainable Development Commission's report, conveniently enough for the Government, is due out tomorrow, but we understand that of all the targets in the report, three are set at red, the rest at amber, and as regards green lights, the Government achieved zero. We know that since 1999 carbon has not reduced at all in the UK; indeed, it has gone up by 9 per cent. Whatever the Government are doing, it is not working. Is it not time that they got together with the Conservative Opposition and perhaps even the Liberal Democrats to find some kind of cross-party consensus to tackle the greatest threat facing the globe for generations ahead?

Mr. Morley: The hon. Gentleman is incorrect—CO 2 has gone up 3 per cent. since 1997. It went up 3 per cent. in 1996—in one year alone—and subsequently fell back. It would have gone up 5 per cent. if not for measures introduced in the 2000 climate change review. There is no room for complacency. We are committed to getting our domestic target of 20 per cent. on track. We will introduce the climate change review and, as our amendment made clear in the recent debate on climate change, we are more than willing to consider ideas from the Opposition. So far, none has been submitted.

Colin Challen (Morley and Rothwell) (Lab): I add my congratulations to the plaudits already given to the Secretary of State for the agreement reached in Montreal. I note that Paula Dobrianski, the US Under-Secretary of State for Global Affairs who was present in Montreal, said that the United States would not welcome formal discussions geared towards a one-size-fits-all approach, which perhaps ties in with the Byrd-Hegel resolution of the US Senate. May I therefore suggest that contraction and convergence are the way forward? That is not a one-size-fits-all approach, and I hope that the Government will provide time for a Bill on that point, which has its Second Reading on 14 July.

David Taylor (North-West Leicestershire) (Lab/Co-op): Whose Bill is it?

Colin Challen: It is my Bill.
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Mr. Morley: The principle of contraction and convergence undoubtedly has some attractive elements, and I am interested in the concept. Given the talks in Montreal, the principle does not appear to command a great deal of international support at the moment.

Mr. Peter Ainsworth (East Surrey) (Con): You may share my sense of déjà vu, Mr. Speaker: I am here again; you are there; the Minister is in his place; and the Secretary of State is not here—so not much has changed. I am sorry that the Secretary of State is not here because I want to place on the record my congratulations on her personal contribution to the limited success of the Montreal discussions. However, it will need more than an agreement to talk to reduce the risk of a catastrophic slide into climate change. Will the Minister reconsider his answer to my hon. Friend the Member for North Wiltshire (Mr. Gray)? Just as it is vital to have international agreements to tackle climate change, is it not vital to have a cross-party approach to tackling those issues in order to set a framework in which to deliver climate change emission reductions?

Mr. Morley: I welcome the hon. Gentleman back to the Front Bench, although given his chairmanship of the Environmental Audit Committee and the number of times that I have appeared before it, he does not appear to have been away. I welcome his recognition of the crucial role played by my right hon. Friend the Secretary of State at Montreal, but he will find that non-governmental organisations and the international community think that the agreement was much more significant than his assessment. I welcome an approach based on consensus, and a consensus exists within this House on the principles, which is helpful in tackling the real environmental threat. On exploring that consensus, however, we need to know where the Opposition stand, and I repeat my invitation to them to spell out their position and ideas on climate change, because we cannot wait for 18 months while the matter is referred to a working group.

Mr. Ainsworth: We will spell out our considered recommendations in due course, and I look forward to working with the Minister on them. Does he accept that normal politics are not working when it comes to climate change, because the problems are too long term and too great? May I press him again on the concept of an independent body that transcends individual Parliaments, individual Governments and individual changes in party leadership, in order to monitor progress, set targets and achieve progress against those targets? The Government are trying to provide leadership internationally on that vital issue, but that should not be undermined by failure to make progress at home.

Mr. Morley: I do not disagree with those general points, but Conservative Members have not done enough homework on the procedures by which our progress is audited. Our targets and the inventory are calculated by an independent organisation, the National Environmental Technology Centre, by the United Nations framework convention on climate change and by the National Audit Office. Those are respectable bodies that provide independent assessment, but if the hon. Gentleman does not think that they are adequate, I would be willing to consider his points.
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Ed Balls (Normanton) (Lab): Will my hon. Friend report to the House on progress on building an all-party consensus on the measures that are needed to meet our climate change targets? Has there been any indication thus far that the main Opposition party intends to drop its opposition to the climate change levy?

Mr. Morley: No. I know that my right hon. Friend the Prime Minister pressed the Leader of the Opposition on that, but as far as I understand it, the position of the Conservatives is that they are against the climate change levy, which has made a significant contribution in reducing CO 2 . If they have changed their position, I will be willing to hear about where they stand now.

Norman Baker (Lewes) (LD): I add my congratulations to the Secretary of State for her efforts in Montreal. She has done a very good job. I look forward to her perhaps taking over the Office of the Deputy Prime Minister and the Department for Transport as well.

The Minister will agree that in order to deal with climate change it is important to get renewable technology up and running. Can he therefore explain or justify the fact that £210 million of the £270 million raised so far under the non-fossil fuel obligation fund has been siphoned off by the Treasury under the cloak of the Civil List Act 1952? Does he agree with that new Treasury stealth tax?

Mr. Morley: I do not agree that it is a stealth tax. If the hon. Gentleman looks at the overall accounts in relation to the Treasury books, he will find that, yes, some of that money goes into the Treasury, but the Treasury pays out a great deal more in terms of overall support to renewables. The money is not simply siphoned off.

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