Select Committee on Environmental Audit Minutes of Evidence

Examination of Witnesses (Questions 680 - 699)



  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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