Examination of Witnesses (Questions 680
- 699)
WEDNESDAY 14 JUNE 2006
RT HON
DOUGLAS ALEXANDER
MP, MR SIMON
WEBB AND
MR NIGEL
CAMPBELL
Q680 Emily Thornberry: The Voluntary
Agreement with car manufacturers to reduce CO2 emissions,
I think you said, has resulted in them going down by 10% but it
still missed its target by quite a lot. We seem to be doing worse
than France, Spain and Italy. Your predecessor hinted that you
might change the Voluntary Agreement into a mandatory agreement.
Have you had a chance to consider this?
Mr Alexander: There are a couple
of points I would make in response to that. Firstly, in terms
of how we do relative to other European countries, the level of
dieselisation in Britain is significantly below, certainly, that
of France, if I recollect, and also that of Germany. The structure
of the market is different in terms of the impact on carbon. Secondly,
the substantive point you make is would I stand by the commitment
that Alistair gave that we would countenance a mandatory agreement—yes,
absolutely. I would not, at this stage, prejudge whether we will
move towards that mandatory agreement or whether, by further discussion
with the manufacturers, we may be able to take forward the Voluntary
Agreement, but I can assure you that given the progress that has
been made under the first Voluntary Agreement we are actively
engaged in those discussions because it seems to us to be the
right way to go.
Q681 David Howarth: Road building.
The Climate change Programme says that: "The Government appraises
all its road schemes for their environment impacts, including
carbon dioxide emissions". But if you have been reading the
evidence we have been receiving, last week Friends of the Earth
said that the Department: "certainly does not have the information
on the carbon impacts of many of the road schemes that it is building".
Can I ask three quick questions about that: first of all, for
the 35 major road building schemes have been completed since 2001,
does the Department know the net carbon emissions impact of those
schemes, and if so how much is it? Second question: how many road
projects have been turned down because of their carbon emission
characteristics? The third question is: how exactly does the Department
appraise the impact of road projects on car emissions? In particular,
how does it choose between a road project and, say, a public transport
or rail freight project, addressing the same problem but with
different carbon emission characteristics? What part does carbon
emission play in the choice of schemes?
Mr Alexander: I will ask Nigel
to answer the specifics in terms of the New Approach To Appraisal
that the Department has taken in recent years, which addresses
some of the points that you have raised. I just want to bring
to the Committee's attention, by way of context, one fact which
I have to say I was genuinely intrigued to discover when I came
to the Department, which gives you a sense of context because
prior to coming to the Department, obviously, there was a lot
of discussion, and there continues to be a lot of discussion,
about the relative importance of the money that we as a Government
are committing to targeted investment in the road network at the
same time as we are trying to meet our obligations in terms of
carbon. The Renewable Transport Fuels Obligation (the RTFO of
which I spoke) is expected to save, in 2010, 10 times the greenhouse
gas emission caused by the Highways Agency's road improvement
in this decade. So I think that gives you quite a sense of perspective
in terms of the relative merits, because I think it would be easy
to fall into the erroneous presumption that actually the work
that is being taken forward in terms of the targeted road building
within the Department far exceeds the measures that we are taking
to counteract the effects of climate change. Nigel, do you want
to say a word in terms of the three specifics that were put to
us?
Mr Campbell: Certainly. First
specific, the CO2 of the 35 road schemes; I am afraid
a figure I carry round in my head is the one about it being a
tenth of the emissions from the Renewable Transport Fuels Obligation,
and that is for the Highways Agency's road improvements this decade
rather than 35 specifically. So that is the planned—
Q682 David Howarth: Are figures available,
if you can write to us?
Mr Campbell: We will certainly
write on that. The second thing is, let me explain the appraisal
process. For any scheme costing more than £5 million the
promoter (whether that is a local authority, the Highways Agency
or Network Rail) is asked to produce an assessment against 23
different criteria, including greenhouse gases, landscape, biodiversity,
heritage, safety, time-savings and reliability (there are others),
and all those effects are included in the advice to Ministers.
That is true for a road project, a rail project, tram, bus—any
of these capital projects. That is the New Approach to Appraisal,
a 1998 invention, to try to put all these things on a consistent
footing. In addition to that, what we have also done is tried
to provide to Ministers advice that says: "We will try to
help you add these up and you can make a decision; you can just
look at one line if you like and say: `The landscape rules this
out', but we will try to add these up as best we can." Environmental
valuation is really difficult stuff and there is a lot of argument
about it, but we made quite a lot of headway on noise, carbon
and landscape in recent years, and we use the cross-Whitehall
DETR values for carbon emissions, which is £75 per tonne
of carbon today.[1]
Mr Alexander: So, essentially,
you attach a social cost to carbon as part of that approach to
appraisal.
Q683 David Howarth: So the answer
to the question: "How many have been turned down on their
carbon emission characteristics" is, presumably, you do not
know.
Mr Campbell: Because the advice
that we provide is: "Here are the effects on everything and
then, when we added them up, this now looks poor vfm or low value
for money or high". It is the case that things move down
a category quite often for environmental reasons.
Q684 Emily Thornberry: In the information
that you will be kindly supplying to the Committee on the carbon
emissions, could you include any monitoring that you have done
of carbon emissions arising out of the building of the M6 toll
road?
Mr Campbell: Certainly.
Q685 David Howarth: Finally, on this
point, just to clarify the point I was trying to make about comparison,
it sounds as if what you do is you simply assess each project
as it comes in against criteria, and you never put yourself in
a position of saying: "Do we want to build a 10-lane highway
where the A14 is or, instead, do we want to go for a public transport
solution to the same problem?" You are just assessing things
serially as opposed to in parallel.
Mr Campbell: I do not think that
is right. To pick one area, there is some regional advice we have
asked for last January on Regional Funding Allocations for projects
which are of mainly regional significance. So the North West was
asked to choose all the projects in their area with the exception
of a few strategic ones of national importance, and they were
given the choice between proposing public transport alternatives
and road alternatives, and that was their judgment. So, quite
often, not only are promoters coming forward with different sorts
of propositions of local roads and local public transport to solve
the same problem, but, also, when there were lots of possibilities
in the pot it was for the region to decide what they wanted.
Mr Alexander: In relation to Regional
Funding Allocations, for example, in the North West, I do not
think it would be any secret that colleagues in the North West
would be arguing for the Manchester Metrolink as one of the elements
of the transport mix that they would be looking for the Department
to help finance. So even within those regional funding allocations
it is not the case that it is simply any longer a situation where
a series of isolated projects comes to Ministers. What we have
tried to do within the department, because I again looked at this
in anticipation of decisions that I will have to make, is first
of all standardise the criteria against which judgments are made
by ministers both in terms of the language used by officials so
that you do not now receive submissions in the Department for
Transport saying, "This is an absolutely fantastic road."
There are objective criteria that are given to ministers when
ministers then exercise judgment, as well as the systematisation
of the information which comes to ministers to equip them to make
that decision. We have also taken a fairly bold initiative in
terms of the RFA process that was described of proactively going
out to the regions affected and asking them themselves to make
judgments which in turn affect the decisions ministers make, so
we have both strengthened the process internally within the department
but also added a new dimension in recent years which is to say
if you are the north west, the south west or the east of England
tell us what you are looking for which in turn will help affect
the decisions. It will not simply be that there is then a calibration
of judgment by ministers. There will also have been one taking
place in the region itself and that will certainly by across modes.
It will not simply be in relation to roads.
Q686 Mr Chaytor: What assessment
has the department made of the potential for reducing speed limits
in delivering further emission reductions?
Mr Alexander: This is a question
on which I have spoken already to my colleague, Dr Stephen Ladyman.
There was some discussion in conversations that I had. There is
a judgment to be made in terms of how best to effect the outcome
that we would like to see, which is people driving not just safety
in terms of their own safety and the safety of other members of
the public but also in a way that is least environmentally harmful.
One then runs immediately though into questions of the cost of
enforcement and those discussions involve not simply the Department
for Transport but also ACPO and those charged with law enforcement.
There is not a direct parallel but something similar in terms
of judgments that have to be made about the level of alcohol in
the blood as well. There are some at the moment who argue we should
go down to 50 milligrams rather than 80 milligrams. There is a
very similar conversation at that point that you have with the
police in terms of what would be the relative time committed in
terms of enforcement to return what you want. The judgment that
we have made on the basis of some of the policy work that we have
already done in the department is that there are significant gains
that can be made by ensuring that people drive in an eco-friendly
fashion. Whether that is through the kind of work that I described
with large fleets through logistics, making sure that companies
will save money and do not have their vehicles on the road for
any longer than they need to be, it is one of the areas we are
considering in terms of assistance directly to drivers as well
so that they can drive in an eco-friendly manner.
Q687 Mr Chaytor: Is it the case that
in the first draft of the Climate Change Programme there was a
specific recommendation to reduce the motorway speed limit?
Mr Campbell: That was not the
case. What happened during the Climate Change Programme was that
a lot of options were put forward.
Mr Webb: I talked about the interdepartmental
analytical group. You go through loads of options and you would
not be surprised to find this one popping up but it did not make
it.
Q688 Mr Chaytor: What was the figure
attached to the reduction of the motorway speed limit in terms
of estimated CO2 emission reductions?
Mr Alexander: I do not have that
information in front of me.
Q689 Mr Chaytor: Of the order of
a million tonnes of carbon?
Mr Campbell: I have something
saying 0.8.
Q690 Mr Chaytor: That is simply enforcing
the existing limit?
Mr Campbell: No. That is 70 to
60. The existing limit I think is more like 0.56.
Q691 Mr Chaytor: Enforcing the existing
motorway speed limit is 0.56 and restricting it from 70 to 60
is 0.8?
Mr Campbell: Yes.
Q692 Mr Chaytor: We are not far from
the total reduction that was predicted to come from company car
tax, which was a million tonnes of carbon, which has now been
revised to only half a million tonnes of carbon. We are not far
from the net effect of the current estimates for the renewable
transport fuels obligation. The gross effect is a saving of 1.6
million tonnes but the net effect, once you discount the emissions
involved in the process of buying renewable fuels overseas, is
a million tonnes. Given that we have two policy instruments here
which are your flagship policies—company car tax and renewable
transport fuels—and we have the potential for enforcing
the speed limit or reducing it which would deliver almost as much
carbon reduction, why has the department shied away from progressing
that policy?
Mr Webb: The existing speed limit
and a reduction sound similar but they are two very different
propositions, are they not? No one is suggesting that there is
not a degree of enforcement of the current policy. The 0.56 is,
if you like, about complete enforcement, you absolutely do it.
That is a police job. Nobody else can do it bar the police. One
of the reasons why we do this interdepartmentally is we have to
have some cognisance of the other demands on the police. It does
not take a long look around to see that the police are under pressure.
We are already trying to help them with some of the safety tasks
or the accident tasks they have done on the motorways. We have
freed some of them up to do that so it is not simply a question
of—
Mr Alexander: I was not privy
to the conversation because it predated my time at the department.
That was the point I was trying to draw out at the beginning.
There is a difference between scoring a figure in terms of notional
savings of carbon and being confident that that can be achieved,
given the discussions which Simon is right to recognise necessarily
involve discussions with the police. I have had more discussions
already with colleagues within the department as this applies
to issues in terms of blood/alcohol levels, but it is the synchronisation
you have with the police in terms of what is the impact on the
police's ability to do the very wide range of responsibilities
we charge them with of moving towards a strict enforcement regime
for a different speed limit.
Q693 Mr Chaytor: Would a speed camera
on every motorway bridge not do the job equally effectively?
Mr Alexander: There is a different
and highly controversial conversation, as you know, which has
taken place in terms of the merits and demerits of speed cameras.
I, in my first broadcast interview in the job, made clear that
I did recognise that speed cameras had a role to play notwithstanding
that they are very unpopular with certain drivers. I think they
have made a significant contribution towards road safety but it
would involve factors beyond simply environmental questions to
move down the particular path that you are recommending.
Q694 Joan Walley: Can I clarify the
responses to Mr Chaytor's question? There may be a case for perhaps
a little more political direction in terms of this analytical
group within the Department for Transport and in the cross cutting
sense as well if we are to achieve our objectives.
Mr Alexander: I am not entirely
clear on the point that you are making.
Q695 Joan Walley: I wonder how much
this has been left to officials.
Mr Alexander: There is a distinction
to be drawn between my reasonable caution in discussing decisions
that were taken by my predecessor, when I was not in the position
of Secretary of State for Transport which will have come from
the analytical group to ministers to be agreed in terms of a joint
programme across government, and the humility I am expressing
on my part that I cannot claim to have been privy to the conversations
at the time in terms of the relative merits and demerits of the
individual policies which then found expression in the joint government
programme published prior to my arrival in the department.
Q696 Tim Farron: Moving on to buses,
the Department for Transport has a target of 600 low carbon buses
in the service by 2012. The last figures we have available to
us show that there were 19 entering service in 2004. At this rate
how do you expect to meet the target?
Mr Alexander: Firstly, our evidence
is that this is challenging, the reason being that the economics
of the market are not at present aligned with there being a significant
uplift at the speed that we would have wished. In the conversations
I had with officials there has been some movement. Principally,
those buses are in London. I asked the question as to how many
of them were outside London because in London there are both hydrogen
buses and also hybrid vehicles which fall within that category.
You are right to point out the fact that we are at this stage
some way off the 600 that were originally anticipated. It is a
matter which is receiving continuing concern within the department.
Q697 Tim Farron: Do you know when
you are likely to reach the target at this rate of projection?
Mr Campbell: We do not. The Powering
Future Vehicles strategy is being reviewed this year and we are
asking for the low carbon vehicle partnership's advice on this.
They have a bus working group. They are seized of it. There is
always a temptation to do these things with straight lines: 19
so far so how many generations before you get there? They are
more likely to arrive in fits and starts. Low carbon buses are
harder than low carbon cars probably, as in not quite as quick.
Q698 Tim Farron: There are of course
ways of engineering the fits and starts. The bus service operators'
grant subsidises fuel costs and therefore removes the financial
incentives for bus companies to invest in low carbon vehicles.
In addition, your department announced last week that you would
not be restarting the low carbon bus grants so where are the incentives
to have a few more fits and starts and bigger fits and starts?
Mr Alexander: Again, this reflects
the fact that policy making is multi-dimensional rather than one
dimensional. If the bus service operators' grant was simply devised
to achieve one policy objective, the policy in government would
be a lot simpler than in the real world. The bus service operating
grant, which I think stands at about £370 million a year
at the moment, has been absolutely key in terms of the maintenance
of rural bus services. There has been a recognition of the fact
that we need to be able to have a degree of stability in the provision
of those services which often are otherwise economically marginal.
We will continue to reflect upon our environmental objectives,
but I would not claim that the principal reason for the instigation
of the bus service operators' grant was specifically environmental.
It was as much to reflect the fact that we wanted to provide local
authorities with a means of providing those services which otherwise
simply would not exist. In terms of the cleaner bus grants, it
was about 30 or 40% of the costs that were anticipated by those
grants which I do not think were judged to be sufficient.
Mr Campbell: That is right. The
state aid regime means that we would not have been able to pay
more than 30 to 40% of the extra costs. As a result of that, we
did not expect that there would be much take-up for it. We would
tend to be giving grants to people who would be doing this anyway.
That is why it looked like it was quite costly per environmental
benefit and why, as announced last week, we are looking to get
the same or more environmental benefit with the same money.
Mr Alexander: It is uncomfortable
to be saying that we are going to proceed with the scheme but
it is a necessary judgment—I hope the Committee would agree
with this—that one is looking for the maximum environmental
return for the commitment of public money. That does mean that
if you are not going to see the market transformation in terms
of a scheme that has been devised or if the consequence of state
aid rules means that you cannot get yourself beyond a certain
threshold which will not be market transformational, it is a reasonable
and rational response to say are there other routes by which we
can achieve the same aims.
Q699 Tim Farron: Obviously you want
to do what works. Going back to the bus service operators' grant
I represent a rural constituency and it occurs to me that there
are other ways of funding bus service operators without fixing
the subsidy to fuel costs. There are other things that you could
subsidise: number of community transports, the number of communities
served and the number of services, without subsidising the fuel.
Surely that would be something you would want to look at. Is it?
Mr Alexander: It is the case that
through the comprehensive spending review and other processes
we will assess all of our departmental expenditure. I think you
need to recognise, not least given your own representation of
a rural constituency, that many of these services are judged to
be very important and that stability is necessary. My recollection
is that there was a review of the bus service operating grant
three years ago at which a judgment was made that the cost in
terms of disruption potentially to those services outweighed the
merit of changing the Bus Service Operators' Grant at that stage.
These are finely calibrated judgments but, if you have specific
recommendations in terms of how we can ensure better environmental
benefits without causing consternation in your rural constituency,
maybe we can turn the tables and you can send me a letter.
Tim Farron: I will be writing to you
shortly.
1 Footnote inserted by witness 21.06.06: The social
cost of carbon as used by HMG is £70/tC (2000 prices) for
carbon emissions. This increases by approximately £1/tC per
year in real terms for each subsequent year to account for the
increasing damage costs over time. Back
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