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Gregory Barker (Bexhill and Battle) (Con): World scientific opinion no longer seriously debates whether climate change is happening, but merely how fast it is happening. The effects of global warming are all around us on every continent. However, they are as yet but a foretaste of the extreme changes and severe shifts in weather patterns that will be the fate of successive
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generations unless our generation, in our time, finds the will to act. Our planet is fast approaching what scientists call the tipping point—the point in the next decade at which, if we can limit and begin to substantially reduce the amount of carbon we pump into the atmosphere, we may stand a chance of abating the worst of the climate change scenarios. If we do not, the long-term consequences will be severe indeed. Against that background—and recognising the need, where possible, for concerted cross-party consensus on this issue—there is a lot in the motion with which we can agree.

It is an undeniable truth that carbon emissions have risen since Labour took office in 1997, while at the same time there has been a steady fall in taxation derived from green taxes. There simply is no excuse for that. While environmental taxes as a percentage of total taxes and social contributions stood at 9 per cent. in 1993 and rose successively during every year of the final term of the last Conservative Government to stand at 9.7 per cent. in 1998, they have fallen, with one very minor exception, in every single year since 1999. In 2005, environmental taxes fell to just 7.7 per cent., down from 8.3 per cent. in 2004. We are committed to reversing that trend.

That lack of focus from the Chancellor is all the more extraordinary because, as the amount of tax on environmental bads as a percentage of total taxes has steadily fallen in recent years, our knowledge and understanding of the impact of global warming has greatly increased. Since Margaret Thatcher became the first global leader to warn the world of the dangers of climate change in the late 1980s, our comprehension of the science of man-made global warming and our appreciation of the need to take concerted, urgent action has grown immeasurably.

The Government have not been blind to that science. Many Ministers, including the Department for Environment, Food and Rural Affairs team, have a personal commitment to the climate change agenda. Indeed, on the international stage, the Government have endeavoured to continue to play a leadership role. Abroad, Ministers’ efforts have met with significant success, but at home Labour’s record is far more depressing.

It is all the more surprising to Conservative Members, who have gasped and widened their eyes at the succession of Budgets from the Chancellor in which new and ingenious stealth taxes have been unveiled and taxes have risen year after year, to witness complete indifference to the one matter about which he would have been much more certain of finding consensus on the need to increase taxation—environmental bads. Under Labour, the Treasury has been unimaginative, unambitious and unbelievably complacent.

An explicit example of a well-intentioned but unambitious policy, complacently implemented, is the enhanced capital allowance scheme, which the Chancellor introduced in the 1999 pre-Budget report. The building industry has enjoyed the benefits of the ECA scheme for using emergent, efficient technology, yet that incentive, which is now seven years old, has fallen behind the latest round of building regulations and acts as a barrier to applications of new and emerging technologies such as thermal mass and natural ventilation. Individual elements of plant and machinery capital expenditure are included in the scheme, yet holistic and efficient
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building design, as encouraged in the new building regulations, is not taken into account. All attempts to include additional sorts of holistic technology outside the narrow definition of plant and machinery have been successfully rebuffed. The Government have no vision and no ambition.

When the industry has contacted DEFRA about the inclusion of new technology in the scheme, including technology that would dramatically reduce a building’s carbon footprint, it has been referred to the Carbon Trust as technical adviser to the scheme. However, when the Carbon Trust has been contacted, the industry is referred back to DEFRA and Revenue and Customs, which is responsible for the scope of the scheme. Perhaps the Chief Secretary could deal with that point in his winding-up speech.

Perhaps the greatest element of underperformance is the Government’s much vaunted climate change levy. It is a good idea and a terrific brand, but its detailed application is profoundly inefficient. It is not focused on CO2. The climate change levy is a tax on the energy that business uses. It should be reformed so that it is based on CO2 emissions from different fuels, and the rates should be increased towards the estimated social costs of greenhouse gas emissions. The increased revenue should be earmarked for “climate change mitigation measures”. Those are not my words but those of Mr. Tony Grayling, the Secretary of State’s special adviser. Let me make it clear: under the next Conservative Government, the climate change levy will be replaced by a more effective method of reducing carbon emissions, as part of an overall framework of carbon pricing throughout the economy.

Another perverse impact of that inefficient environment tax is its application to UK agriculture and horticulture, which have exceeded their climate change levy targets. Despite that good record, the targets have been increased to unattainable levels, while other sectors, such as aviation, remain uncontrolled. The perverse outcome is that there is now a serious prospect of UK-produced horticulture and UK poultry and pig production ending and being replaced by imported produce, which will be sucked into Britain using untaxed aviation fuel. How good can that be for global climate change, let alone British farming? What is the DEFRA team doing to sort out that mess?

However, my main criticism of the Government is that, rather than concern themselves with clear, ambitious, accountable policy-based instruments, predicated on either tax incentives for environmental goods or green taxes on environmental bads, they have a peculiar fascination with short-term initiatives, stop-go grant funding, tiny pots of money here and tiny pots of taxpayers’ money there.

One of the most extraordinary examples of Treasury micro-dabbling in the private sector with taxpayers’ money is its current participation in the 21st century sustainable technology growth fund, which is currently making its debut on the stock market. One fund manager who had received a presentation contacted me, totally unable to understand the Government’s willingness to use taxpayers’ money to put up two thirds of the money for that small, private sector venture capital fund, while agreeing to take only 12 per
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cent. of the profits. Is that really a prudent use of the taxpayer’s money? What would the Treasury Minister have to say about that?

We wholeheartedly agree with the broad thrust of the motion before us, but there is a problem, in that it gives the impression that if we can clobber the Chelsea tractor, all will be well with the world. The Lib Dems’ myopic obsession with a small number of 4x4 motorists entirely misses the larger point.

Chris Huhne: Will the hon. Gentleman give way?

Gregory Barker: I will in a moment.

I do not for a moment deny that we need to take a more responsible approach to transport emissions. However, it is somewhat bizarre to criticise the Government for their whole record since 1997, then just to deduce from that a failure to tax Range Rovers and Porsche Cayennes—particularly, I presume, the turbo variety that was scurrying around the Leicester by-election, full of Lib Dem campaign strategists. There is, however, a clear role for the Government to ensure environmentally friendly transport systems. The Government are intricately involved in the transport infrastructure, and more than a quarter of our carbon emissions come from transport. Without action on transport, action on emissions will be limited. The Conservatives have already announced an ambitious policy to reduce average emissions from cars to under 100 g per kilometre for all new cars by 2022 and for all cars by 2030. We propose to work hand in hand with the most progressive companies to make that vision a reality.

So why are the Lib Dems so preoccupied with 4x4s? Perhaps it is because they have failed to think through their climate change strategy with the same depth and breadth that the official Opposition are employing. Both our parties have elected a new leader in the past 12 months, albeit in rather different circumstances. My party, embracing the need for change and renewal, took a great leap forward and skipped a generation. The Lib Dems, perhaps noticing how effective this had been, also decided to skip a generation. With a novel Lib Dem twist, however, they went in the opposite direction.

Martin Horwood (Cheltenham) (LD): I am pleased that the hon. Gentleman is going to be dealing in depth with the Conservatives’ policy, as that approach has been a little lacking in his speech so far. I am a little confused, however. He supported the broad thrust of our motion and our proposal for green taxation, yet he seems to have an obsession with the line about 4x4s. Will he clarify whether he would support an increase in vehicle excise duty for the worst offending vehicles, including 4x4s?

Gregory Barker: There is a clear case for looking at the whole of transport, and our policy review committee is doing that. As soon as its findings are announced, I will send the hon. Gentleman a minute. I am not going to prejudge those findings now, but transport is clearly going to have to be addressed.

Chris Huhne: For the sake of the record, I should like to point out to the hon. Gentleman that there are 4x4s that fall below the top vehicle excise duty band
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involving 220 g per kilometre, including, I think, the one that he drives himself. Many other cars in that top band are not 4x4s. Our proposal is to take the band as it has been set out by the Chancellor and to add some bite and incentives, rather than merely adding a £45 increase, as the Chancellor proposed in the Budget.

Gregory Barker: I would pay slightly more attention to that if the hon. Gentleman had the foggiest idea of the impact that his proposed policy would have on the sale of 4x4s. Perhaps, when his colleagues wind up the debate later, they could tell us why, during our debate on the Finance Bill, the Liberal Democrats proposed to reduce the rate of vehicle excise duty for the most polluting vehicles registered before 23 March this year for households with a postcode in a rural area. What is the environmental argument for doing that? I shall be happy to give way if someone would like to answer that question.

Chris Huhne: Perhaps the hon. Gentleman is aware that some 4x4s are important for getting about and doing business in rural areas. It is important to take that into account in our proposals.

Gregory Barker: I am sure that all the mums who drive to school in their 4x4s in my part of East Sussex will be very glad to hear that. Likewise, the 23 March cut-off date will also intrigue a lot of car salesmen.

Martin Horwood: Will the hon. Gentleman give way?

Gregory Barker: I really must make some progress.

It was Disraeli who said of Gladstone that he was an old man in a hurry. I would certainly not presume so to label the new Lib Dem leader, but a budget written for three years hence, whipped out in less than six weeks after taking the reins, does have a slight whiff of the back of a fag packet about it. My party makes no apologies for having commissioned the most extensive policy review process since that undertaken by Margaret Thatcher and Keith Joseph in the 1970s, or for throwing out preconceived notions and looking afresh at the challenges of the new century with the help of today’s experts and tomorrow’s leaders. The policy review process is drawing in not just committed Conservative party members but experts from across the country who are keen to participate in the intellectual renewal of a great political party and a Government in waiting. We will not make the mistake that Labour made of entering its first term of government without having undertaken hard thinking about policy in opposition.

When one considers the failure of Labour to reduce our output of carbon emissions, the Liberal Democrat notion that that would be reversed by slapping more vehicle excise duty on a few gas guzzlers is frivolous. Yes, the true cost of such cars should be more accurately reflected in the price, and I look forward to the considered opinions of our policy review commission. The CO2 from those large cars, however, is dwarfed by that emitted by the UK energy sector or from UK homes. Nothing in the motion provides an answer to that.

The Conservatives, under my right hon. Friend the Member for Witney (Mr. Cameron), are far more ambitious. We want to see far more policy focused on
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really sustainable green growth, and far greater efforts to promote renewable energy, especially that generated and consumed close to the point of use. We want that ambitious big-picture thinking converted into real measures to create a decentralised energy revolution. That degree of ambition was sadly lacking in the Government’s recent energy review.

We also want far more progress on reducing the CO2 emissions from Britain’s buildings—new and old, residential, commercial and industrial. Again, little in the Government’s record points to a really ambitious programme, and certainly not to a dramatic reduction in CO2 emissions from the built environment. The news last week that DEFRA is slashing funding to the Energy Saving Trust to give Ministers something new to say is disgraceful. Although the Treasury is the worst offender, Labour’s strategy right across Whitehall lacks ambition. Even relatively modest non-fiscal proposals to allow progressive local councils to go further than Whitehall by insisting on renewable energy and eco-building standards in local new developments, which were put forward by Conservatives during the passage of the recent Climate Change and Sustainable Energy Act 2006, were frustrated by the Government.

To return to the motion, we can wholeheartedly agree with the Liberal Democrats’ call for annual targets to cut carbon emissions and an independent monitoring board to report on progress to Parliament. In fact, the Leader of the Opposition, my right hon. Friend the Member for Witney, got there first. He joined Friends of the Earth and a host of other green NGOs in early September to call for a climate change Bill in the Queen’s Speech. He reiterated that call in his speech at the Conservative party conference in Bournemouth, and it was echoed in my speech in the Government debate on climate change last Thursday.

Martin Horwood: Can the hon. Gentleman therefore explain why the last Conservative manifesto, which was apparently co-authored by the right hon. Member for Witney, included only two lines about climate change?

Gregory Barker: I cannot explain that, but I can explain about the future. This Conservative party is changing radically and significantly under my right hon. Friend the Member for Witney, as everyone is witnessing. Now that he is in charge, and not just editing the manifesto, we will see his commitment to the environment, of which a climate change Bill is a key part.

Dr. Whitehead: I have listened carefully to what the hon. Gentleman has said about the Conservatives’ ambitious proposals for the environment, which, in many ways, everyone in the Chamber shares. But will he explain how one can have ambitions if one does not know what those ambitions are about?

Gregory Barker: I am sorry, but I do not quite follow that tautology. We are ambitious and have set about an ambitious policy review process. At the end of that process, in June, we shall announce the findings. I know that the Labour party is in turmoil, so if the hon. Gentleman is expecting a general election sooner than next June, perhaps he can tell me afterwards. I can then have a word with my right hon. Friend the Member for
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Witney and we might be able to fast-forward our policy review process. Unless that is the case, I think that we are safe in anticipating that we can allow the experts to do some serious thinking, not the back-of-a-fag-packet stuff in which the Liberal Democrats engage, and come up with some credible, long-term, well-thought- out proposals How can we tell the British public with conviction that we have changed if we just have a knee-jerk response and our policies appear the next day? I think that they will give us credit for having thought the issues through seriously and consulted widely.

Chris Huhne: Will the hon. Gentleman give way?

Gregory Barker: Not yet.

I often think that policy development is a bit like maths O-level: you get two points for the answer, but three points for showing the working. I am afraid that the Liberal Democrats will get only two points, but we will get five out of five, because we will show the working.

Mr. Graham Stuart: Is it not a shame that the Government have refused to join a coalition with the other parties to build a consensus on climate change, in order to depoliticise the issue and allow the necessary tough decisions to be made? Perhaps my hon. Friend will comment on why, under their current leadership, the Liberal Democrats also chose to withdraw from a united front on the subject.

Gregory Barker: I do think it is a shame, but I am not so concerned about the Government, because it would be rather more unprecedented for the governing party to join such a coalition. I think it particularly sad that, as well as announcing a knee-jerk budget for 2009, the first thing the Liberal Democrats did after their new leader took over was jettison all the good work done by the hon. Member for Lewes (Norman Baker) in bringing together the Conservative party, the Liberal Democrats and the other minority parties, and throw away the emerging consensus.

Chris Huhne: Will the hon. Gentleman give way?

Gregory Barker: In a minute.

I do not for a moment suggest—

Madam Deputy Speaker: Order. I hesitate to interrupt the hon. Gentleman, but may I remind him of the importance of addressing the Chair during debates?

Gregory Barker: Absolutely, Madam Deputy Speaker. I apologise.

As I was saying, I regret the fact that the Liberal Democrats threw away all the work done by the hon. Member for Lewes in consultation with my Conservative colleagues. We were informed in a most abrupt way, through a press release. There was no real effort to keep the consensus alive. This had very little to do with the Liberal Democrats’ belief in consensus, and much more to do with their frustration at the fact that their environmental message was not getting through and they were being put in the shade by my right hon. Friend the Member for Witney. If we consider the calibre of the respective spokesmen, we see why that is.

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