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Rob Marris: The climate change levy is in place and it is accepted by many commentators, although perhaps
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not by the hon. Gentleman, that it has had a positive effect. There may be individuals, and the hon. Gentleman may be one of them, who think that the positive effect has not been sufficient to outweigh the negatives, but I think that it has had a positive effect and so do my Government. It is possible that the energy review will come up with a better way of achieving the objectives, but for the moment the Government—rightly, in my view—are sticking with the climate change levy, which many of us think has worked.

On green issues, I welcome the creation of the national institute of energy technologies, which will be in partnership with the private sector. According to page 151 of the Red Book, its purpose will be—unfortunately this includes a split infinitive—

I think that that is very good.

Mr. David Heath (Somerton and Frome) (LD): It is 10 years too late.

Rob Marris: Well, we are doing it. I would have liked it to be done earlier. I wish that Governments of all political colours had taken energy issues a little more seriously, particularly the issue of so-called alternative energy sources. However, we are doing it, and that is the mark of a Government who are listening and prepared to act.

Mr. Graham Stuart: The Government set clear targets. They accepted targets under Kyoto, although it is questionable whether the country will meet those minimal targets. No commentator thinks that there is any chance that the country will meet the target of a 20 per cent. reduction in 1990 levels of carbon dioxide. Does the hon. Gentleman agree that the small—if, in environmental terms, arguably positive—role played by the climate change levy should not be used to excuse the Government's failure to lead a major campaign on energy efficiency, to listen to the various reports of the Environmental Audit Committee and others over the years, and to transform the country's performance? If this is the biggest issue facing the world today, why have the Government failed so completely, and why do Friends of the Earth say that today's Budget statement will do nothing to tackle the challenges that we face?

Rob Marris: Every little helps, which is why the Chancellor has announced what I hope is an initial fund of £50 million for microgeneration. That is how it works with energy: every little bit helps, whether people are driving fewer miles and cycling more, whether we have microgeneration, or whether we have a few more windmills. Hon. Members need to grasp that we are talking about a whole mosaic of measures. Any one measure will not sort everything out; we need an array of measures. That is what the Government are providing and what the Budget has provided.

Investment in energy efficiency for buildings, both business buildings and homes, is part of that array of measures. We have buildings—this applies, I have to say, to parts of this building—that are leaking energy all the time. Lights are left on, and there is insufficient insulation. We as a society need to invest in energy
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efficiency in the public sector, in the private sector and in our own homes. We are starting to do so and yes, I wish that we had done more earlier, but one has to have priorities in government and they were sorting out schools and the NHS, economic growth and so on. We have done pretty well on those and now we are moving on to energy matters.

Mr. Graham Stuart rose—

Rob Marris: I will not give way because I must make some progress; I hope that the hon. Gentleman will forgive me.

One area where the Chancellor has made some progress in this Budget, although not nearly enough, is vehicle excise duty. There is a new band for vehicles emitting more than 225 g per kilometre of carbon dioxide, the duty for which will be £210. As I say, that is not nearly enough. In, for example, two to three years time, we should introduce a swingeing regime for such vehicles, although I stress that it ought to apply only to newly purchased ones. At one end of the spectrum is the Toyota Prius, which produces 104 g of CO 2 per kilometre. At the other is the Lamborghini Diablo, which produces 520 g. A Ferrari 575 Superamerica produces 499 g. I am not an expert on cars, but I suspect that the Ferrari carries only two people. A Toyota Prius carries five people and a Toyota Aygo, which produces 109 g of CO 2 per kilometre, carries at least four and may even carry five, although I do not know whether it has five seatbelts. One of the Maseratis produces, I think, 525 g of CO 2 per kilometre. We should have swingeing taxes on such vehicles.

Richard Younger-Ross (Teignbridge) (LD): I hate to disillusion the hon. Gentleman, but someone who can afford a Lamborghini Diablo is unlikely to be put off by the rate of duty, whatever it may be. People in rural areas who use four-wheel drive vehicles will be hit by this new band, particularly struggling farmers. Under the proposal, they will pay more even though many such people are on very low incomes. Does the hon. Gentleman agree that the Chancellor needs to look at providing extra relief, so that those for whom the use of four-wheel drive vehicles is essential—I am not talking about non-essential use—are not penalised?

Rob Marris: I am not an expert on rural areas—it may not surprise the hon. Gentleman to learn that in my constituency, periodically there are a maximum of 35 sheep on one very small part-time farm—but so far as I am aware, those for whom the use of 4x4s is essential, such as farmers, purchase red diesel, which is written off for tax purposes as a business expense. The Chancellor may be considering such a rural adjustment—I would not rule it out—but it is not a reason to back off from swingeing increases. I think that the hon. Gentleman broadly supports the direction of travel, to use the modern vernacular, of the swingeing increases that I am proposing.

Richard Younger-Ross indicated assent.

Rob Marris: The hon. Gentleman said that such a rate of duty would not bother the owner of a Lamborghini
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Diablo, but it depends how swingeing it is. I am not seriously suggesting that it should be, say, £80,000 if the car in question is rated above 500 g. However, a duty of £1,000 to £2,000 would affect the resale value of some of these vehicles—perhaps not very fancy sports cars such as Ferraris—and that might influence people when they consider purchasing them. A Range Rover 4.4 V8—which is made in the west midlands by Ford, of course—produces 389 g of CO 2 per kilometre. That is a ridiculous figure. I suspect that few farmers use a Range Rover 4.4 V8 for anything other than taking their daughter to the gymkhana. Instead of introducing a rate of £210, the Chancellor should have opted for a considerably higher one.

I was going to discuss globalisation, but I shall leave that to others as I have detained the House for long enough.

Alan Simpson : I welcome the points that my hon. Friend is making about vehicles that are far more efficient in terms of reduced carbon emissions, but does he recognise that Britain also needs to play catch-up with other parts of Europe? France and Italy have already developed prototypes of vehicles that run on compressed air, which are capable of doing more than 100 miles to the tank and more than 100 km per hour. Does he agree that there needs to be a paradigm shift in how we think about low-impact transport? A punitive approach to what happens now is not enough—we need to be proactive in transforming our thinking about making lighter the footprint that our transport needs leave on the planet.

Rob Marris: My hon. Friend is absolutely right, but the Chancellor cannot use VED directly to introduce compressed-air cars, or whatever. What he can do is use R and D tax credits to that end, as I have mentioned. The UK is a world leader in automotive design, and although British-owned companies may not be great at building cars, our car industry is very big.

I think that Formula 1 lies at the rather silly end of the spectrum but, although it uses a lot fuel, it also produces a lot of technological development. I hope that some British companies are developing techniques involving stuff like compressed air, hybrid engines and hydrogen. That is going on in other parts of the world and I hope that the R and D tax credits will help.

In conclusion, the Government have been in power for nine years, during which time we have moved to what many people recognise is a more Scandinavian model of society. Britain is now more generous and tolerant than it used to be. True, people pay higher taxes for better public services, but I, for one, believe that that is a jolly good thing. The pot is not limitless and taxes cannot go on rising forever, but the increase in employment means that more people now pay tax—even though, as my right hon. Friend the Chancellor pointed out, tax credits and other provisions mean that some do not pay the full net amount.

Today's announcement of free national off-peak bus travel for pensioners was slipped in near the end of the Budget speech and is a fantastic measure. It will improve the quality of people's lives, which should be one of the purposes of any Budget. A huge amount of new money is to go into education, and I was especially pleased with
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what my right hon. Friend the Chancellor said about further education, although I wish that we could do more to fund adult courses for those who have gone beyond level 2. I know that my hon. Friend the Economic Secretary takes a special interest in FE, but the Budget will make a difference in all the matters that we talk about—education, skills and giving every child a chance. It is designed for the future and as a way to help the young people who will look after us in our old age.

I salute what the Chancellor has done today, especially in respect of people-centred policies and education and skills.

3.57 pm

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