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“more or less complete contempt with which”
the Chancellor holds other colleagues. He singled out the Environment Secretary. According to Sir Andrew, the Chancellor’s attitude is:
“If you want something done about the environment, you don’t talk to David Miliband.”
It is all too clear that the Chancellor did not talk to the Environment Secretary before putting together the so-called green part of the Budget.
Let us use the Environment Secretary’s yardstick to see how the Budget measures up. In his letter to the Chancellor, the Environment Secretary warned that
“emissions from aviation are our fastest growing source of greenhouse gas”,
“air travel is lightly taxed”,
“I do not believe that we can leave aviation untouched”.
“There is a case to look again at making flights subject to VAT”,
In fact he went further; he said that VAT should be on domestic flights, as in some other European countries or, better still, on all EU flights.
On Wednesday, the Chancellor told the House that he had
“had representations to put VAT on airline tickets”.
Indeed he had—from the Environment Secretary who, presumably, felt suitably chastened when the Chancellor went out of his way to say that
“the substance of the measure has not been properly thought through”.—[ Official Report, 21 March 2007; Vol. 458, c. 823.]
Could it be that the Chancellor has executed an aerial U-turn, because when we made just that point, the Environment Secretary accused us, absurdly, of wanting to “criminalise” aviation? If taxing something means criminalising it, the Chancellor is responsible for the biggest crime wave of the century. The Environment Secretary’s views about aviation appear to be a little confused.
Martin Horwood: The hon. Gentleman is having great fun at the Government’s expense, but at least we know what their proposals are for aviation, and we know what the Liberal Democrats’ proposals are. What exactly are the Conservative party’s policies for aviation?
Mr. Ainsworth:
As the hon. Gentleman should know if he has been following politics, which is probably sensible for someone in his position, we have published some policy proposals on aviation, and we are consulting on them. Unlike Government consultations, we will listen to what people say and propose policies as a result. I am delighted to have had an intervention from
the Liberal Democrats because it enables me to say how much we look forward to working with them. We believe that we can do business with them onthe environment and that many Liberal Democrat supporters would do well to support the Conservatives on the environment because we share many of their values.
I did a little homework at the weekend and got out my paint set. The paper I am holding up is not a trick; it is genuine. I discovered that yellow and blue make green, but that if red is added it becomes brown. That is absolutely true and I did not mess about with the painting at all, Mr. Deputy Speaker, but I shall put it away quickly because I can see that I am catching your eye in an unhelpful way.
The Environment Secretary’s views about aviation appear to be somewhat confused, but so are the views of the whole Government. We know that the Chancellor does not listen to the Environment Secretary, but he does not seem to listen his own Treasury team either. The Financial Secretary—I am delighted to see him in the Chamber this afternoon—told the Environmental Audit Committee a year ago that
“air passenger duty is not an environmental tax; it is not related to a concern about emissions, it is not related to more efficient aircraft, it is not related at all to more efficient use of the aircraft which are flying.”
That is absolutely right, but the next thing we know is that the Chancellor is doubling air passenger duty to save the planet. However, unlike our proposals, he is using green taxes not as replacement taxes, offset by tax cuts elsewhere, but as a stealth tax. I cannot think of a better way to alienate public support for measures to tackle climate change than to dress up stealth taxes as green taxes. He really does not get the tax offset idea, does he?
We are in favour of increasing green taxes and offsetting them with tax cuts elsewhere. The Chancellor is in favour of announcing headline-grabbing tax cuts and offsetting them with an overall increase in the burden of taxation that hits the least well-off hardest. That is not a tax cut; it is a tax con. What does the Environment Secretary think about green taxes, or has the Chancellor not had time to tell him yet?
Let us return to the right hon. Gentleman’s other proposals. In his letter to the Chancellor, the Environment Secretary asked for a “substantial increase” in vehicle excise duty. In Wednesday’s response to that letter, the Chancellor cut the bottom rate by £15—heady stuff—and increased the top rate by £200. Does the Chancellor seriously think that someone thinking of paying £75,000 for a Porsche Cayenne will have second thoughts because of a £200 hike in vehicle excise duty? This is a classic example of ineffectual tinkering. We need to be far more ambitious and radical. It is high time that the Government backed a commitment to getting car emissions down to 100g per kilometre, with a clear package of incentives and regulations to ensure that the goal is met.
David Miliband: I had a long time to make my speech and to answer questions. A number of those questions—three, possibly four—protested at the increase in vehicle excise duty from £200 to £300 to £400. The hon. Gentleman has just said that that increase is far too puny and that it should be much greater. Will he explain what his position actually is?
Mr. Ainsworth: The concerns that were expressed were in relation to the impact on people in remote rural areas who need to use heavy-duty cars to go about their business. There is a genuine problem there, and the Government have admitted as much.
In his letter to the Chancellor, the Secretary of State then moved on to homes. He asked the Chancellor to look into stamp duty rebates for new zero-carbon development. In Wednesday’s response to the letter, the Chancellor did indeed promise no stamp duty for new zero-carbon homes, but with this Chancellor nothing is straightforward. He sneakily put a five-year time limit on the stamp duty exemption. How many zero-carbon homes does the Secretary of State honestly think will be built by 2012—the deadline for the exemption? Will he explain why a Minister killed off the Local Planning Authorities (Energy and Energy Efficiency) Bill, which was promoted by the hon. Member for Gower (Mr. Caton) and which had all-party support? It would have allowed local authorities to set tougher environmental standards for new homes. It is extraordinary: the Government wreck a Bill by one of their own Labour colleagues that could have made a real difference and instead offer a hollow headline about stamp duty relief on houses that do not exist.
In the final part of his letter to the Chancellor, the Secretary of State asked him to look into removing barriers to innovation. In Wednesday’s response to that letter, the Chancellor attempted to support microgeneration. First, he promised an income tax exemption for domestically produced energy sold back to the grid. That looks like a good move—until one reads the small print. The move is not exactly life-changing. Experts say that it would be worth, at most, £22 a year to householders who go through the hassle of installing renewable energy in their homes—big deal.
It gets worse. Income tax is not currently collected on microgenerated energy anyway, so we have something completely new here. It is not a stealth tax; it is a ghost tax. The scheme does nothing to make it easier for home owners to sell their energy. The Chancellor made no effort to push for a higher grid price for microgenerated energy or for smart meters to allow everyone to buy and export energy more easily. The Chancellor claims that he has asked Ofgem to look into the matter. We are so bored with his asking people to look into it. We have seen endless consultations and dither, timidity where we need boldness, and half-hearted and piecemeal meddling where we need consistency and leadership.
Friends of the Earth called the promise of an extra £6 million for the low-carbon buildings programme “a joke”. The trouble is that tackling climate change is not funny. The low-carbon buildings programme was originally supposed to run for six years. Then we were told it would run for three. Then in December we were told that a monthly cap would be placed on grants to try to draw the scheme out. Then last week we were told that the scheme was being temporarily suspended. Is it not utterly typical that the Department of Trade and Industry released a stealth announcement on Budget day that suspended the low-carbon buildings programme for at least two months? This has been a total shambles. Where consumers and suppliers have looked for certainty, they have found chaos. In March, the grants ran out in 75 minutes. What the Government
have created is a monthly bun fight that is constricting demand. People who are unable to get grants wait until next month, the following month or the month after that to order their chosen technologies, or they simply give up.
So, even on the Secretary of State’s own tests, the Budget was a failure. He asked the Chancellor to look into aviation, car taxes, greener homes and cleaner technology. He wanted the Chancellor to be bold and imaginative and all he got was tinkering. No wonder the Secretary of State said recently—presumably in a fit of bitterness—
“in six months or a year’s time, people will be saying, ‘wouldn’t it be great to have that Blair back, because we can’t stand that Gordon Brown’”.
The Budget also ignored many issues that the Environment Secretary has ignored too much of late. There was no mention of support for the natural environment, despite the perilous state of more than half our sites of special scientific interest. Despite the Chancellor’s obvious lack of interest, will the Environment Secretary confirm that a marine Bill will be guaranteed in the 2007 Queen’s Speech, whoever is Prime Minister at the time? There is no guarantee.
There was no mention of support for our rural communities. The sole rural dimension was a 2p a litre increase in the tax rate on red diesel. Of course, as the House has heard, many farmers and people in remote rural areas will be caught by the increased tax on 4x4s —[ Interruption. ] I do not know why the Economic Secretary to the Treasury is looking so dumbstruck. I am merely reiterating what I said a few moments ago.
On the same day as the Budget, the Lyons report recommended that farm buildings should be subject to business rates. That would represent a £300 million tax on farming. Can the Environment Secretary imagine the impact that that would have? Does he agree with that proposal? Does he agree with the recommendations in the Lyons report on rural farm buildings and business rates?
Hon. Members: Are you going to give way?
Mr. Deputy Speaker: Order. Let us get the procedures right here. If the hon. Member for East Surrey (Mr. Ainsworth) is tempting a Member to respond to him, he should immediately give way. Otherwise, he has the floor.
The Economic Secretary to the Treasury (Ed Balls) rose—
Mr. Ainsworth: If the Economic Secretary is going to answer my question about the Lyons report, I will happily give way.
Ed Balls: I am still digesting the hon. Gentleman’s earlier comments. Does he think that the tax on 4x4s is too high, about right, or too low?
Mr. Ainsworth: The hon. Gentleman has not exactly answered the question. The ominous silence on the question of the impact of the Lyons report on farming will echo around the countryside. I have already discussed vehicle excise duty. It creates a problem for people who have to use such vehicles for their work in remote rural areas—it is as simple as that.
Having read the Lyons report, it is clear why the Government decided to publish it on Budget day: it was a good day to bury bad news. In sum, the 2007 Budget was full of headline-grabbing half measures and wholesale omissions. The Chancellor may have commissioned the Stern review, but it is clear that he has not taken its findings to heart. He just does not get it. It is because there are still people in British politics who do not get it, such as the Chancellor, that the forthcoming Climate Change Bill should provide for annual rate-of-charge targets to be set and audited by an independent body. The Government need a better annual yardstick than a leaked letter from the Environment Secretary. We need a climate change policy that is based on science, not spin.
I understand that some of the Environment Secretary’s friends have nicknamed him Brains, after a character in “Thunderbirds”. I probably do not need to remind you, Mr. Deputy Speaker, that Brains was a slightly weird, geeky character. However, above all, he was a plastic puppet jerking around on the end of a piece of string. We all know who the puppet master is; the strings are held in a clunking fist belonging to the man who assumes that he will soon be the next Prime Minister. People are sick of spin, stealth taxes, tax cons and puppet Secretaries of State whose ambitions, when they exist at all, are ignored and ridiculed by the Chancellor. We need a step change in our approach to the environment. We need a sense of urgency and a message of hope, opportunity and determination. This Budget proves beyond doubt that the last thing that anyone who cares about our fragile environment needs is the change at the top that is being engineered by the Labour party. We need a complete change of direction and a change of Government.
5.34 pm
Mr. Michael Meacher (Oldham, West and Royton) (Lab) rose—
Hon. Members: Change of Government!
Mr. Meacher: I agree with the percipient and prescient comment of the hon. Member for East Surrey (Mr. Ainsworth). I assure him that, under me, the Labour party and a Labour Government would have a very different environmental approach and a genuinely green policy.
I am tempted to go down the route of discussing the Government’s environmental policy after the forceful speech of my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs, but I will not, because I prefer to confine my comments on that subject to the Second Reading of the Climate Change Bill, which, I take it, will be held shortly. I therefore want to talk about a rather different issue, but first I shall make just one comment on the subject.
As my right hon. Friend said, the Government’s record on greenhouse gas emissions is good, at least
compared with those of others, but he made a statement at the start of his speech that I had not heard before. If I heard him correctly, he said that, taking account of the EU emissions trading system, UK greenhouse gas emissions had gone down by 11 per cent. since 1997. I think that he said that.
David Miliband: I am happy to repeat the figures for the benefit of my right hon. Friend, who is a distinguished former Minister for the Environment. On 1990 levels—the figures are for 1990 to 2005—greenhouse gas emissions are down 19 per cent. It is actually 18.8 per cent., I think. For CO2, the figure for 1990 to 2005 is 11 per cent. Since 1997, if we include the EU ETS, greenhouse gas emissions are down 11 per cent. For CO2, if we include the EU ETS, the reduction is 4 per cent.
Mr. Meacher: That is what I thought my right hon. Friend said, and he has repeated something that I have not heard before, namely that if one includes the EU emissions trading system, since 1997, UK greenhouse gas emissions are down by 11 per cent. What my right hon. Friend did not say, but which needs to be said, is that the EU emissions trading system is very poorly crafted. The baselines are far too lax, the allowances are far too generous, and the net deductions are, in reality, very much smaller than is claimed. If that somewhat deceptive scheme, which needs to be sharpened up hugely, is excluded, as I think it should be, I fear that our greenhouse gas emissions have hardly gone down at all since 1997. I am not saying that they have not gone down, but they have gone down by a very small amount. My real point is that they have gone down by much less than the 2 to 3 per cent. a year that is needed if we are to achieve the target of a 60 per cent. reduction by 2050.
Chris Huhne: I am as surprised as the right hon. Gentleman is that the Secretary of State appears to have invented an entirely new statistical series that is not included in the environmental accounts published by the Office for National Statistics. Those accounts show that there has been an increase in CO2 emissions since 1997. At the very least, the Secretary of State ought to place those figures in the Library.
Mr. Meacher: That would be useful, and in light of this debate, I am sure that my right hon. Friend the Secretary of State will consider doing that. I take heart from the fact that my right hon. Friend agrees that the UK has to do much better, and not just marginally better. It has to act on a scale that I do not think many people, including Ministers, have got their heads around. The changes across the spectrum of Government policy will have to be considerable. Having made that point, I want to speak about a different issue.
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