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25 Oct 2007 : Column 170WH—continued
Joan Ruddock:
I am glad that the shadow Minister agrees with this. The Stern report has transformed thinking. I have not only been to the conferences that we have all attended—in Washington, for example—but I have been in Africa, where people have heard of the Stern report and have suddenly understood,
through its approach, the relationship between their economies, the developed economies and global climate change.
My hon. Friend the Member for Gower talked about bringing the maritime sector into the EU ETS. We in the UK Government have been pressing the International Maritime Organisation to address the contribution of the maritime sector to climate change and are investigating options regarding shipping in the EU ETS. So, again, we are on to this in so many sectors, including international aviation. It is the UK that has been pressing for Europe to go further and we are doing it again on the issue of maritime emissions.
I am not sure whether it was my hon. Friend or the hon. Member for Cheltenham who asked about bringing surface transport into the EU ETS. [Interruption.] Sorry, it was the hon. Member for Cheltenham who mentioned that. I know my geography, but it is difficult to make all the notes at the speed one needs to. Potentially, surface transport could be included in the EU ETS. However, that is not the only instrument; there are others. The hon. Gentleman mentioned the standards of manufacture for vehicles. These are important mechanisms through which we can get reductions. We are happy to explore that, but we would also need to have regard to how it would affect other sectors and the mechanism overall.
Mr. Hurd: The Minister is expanding on what the Government are seeking to include in the emissions trading scheme. She may be aware of research from the Institute of Public Policy Research, published in December 2006, which showed that 50 per cent. of the installations included in the ETS account for only 0.8 per cent. of emissions. Does she recognise that that may represent a strong case for rationalising the scheme and excluding small emitters and, in doing so, may reduce the bureaucratic burden on British business? Are the Government, in addition to looking to expand the scheme, considering the opportunity to rationalise it?
Joan Ruddock: I think that that might be likely, but because I am not the Minister responsible I will undertake, if I may, to write to the hon. Gentleman or to get my colleague to write to him.
I think that I have dealt with the concerns of the hon. Member for Bexhill and Battle about transparency by referring him to the report. He talked about buying our way out of emissions. Of course, there is no question of our doing that. The issue is tightening the cap. We were the only member state to put forward a cap that was accepted by the Commission. We are the people who want to drive down emissions through tight caps and that is the way in which we will ensure that we deal with the issues that he raised, and particularly with whether it is right to lower our renewables target so that we do not undermine the EU ETS. The more we have renewables, the more it is necessary to drive down the cap. That is how it works. It is not substituting one for the other. We want to and will increase renewables and in doing so we will continue with the EU ETS and will seek to have tighter caps so that we achieve real reductions, whether here or in other countries.
I hope that I have been able to address most of the issues that have arisen during the debate. If I have not, I
am sure that hon. Members will let me know and we will see whether we can respond appropriately. The EU emissions trading scheme is approaching the end of its landmark first phase, as we have all acknowledged. The Committee correctly points out that important lessons have been learned from that initial phase. Those lessons are vital to ensure that a scheme can deliver emission reductions cost effectively.
We need to use the solid base that phase 1 has provided when building for the future scheme. The scheme can be the basis of a global carbon market. An effective trading scheme can be a springboard for new impetus for the international community to tackle climate change. The Environmental Audit Committee’s report states that emissions trading should not be seen as a miracle cure for global warming, and I share that view. Avoiding dangerous climate change will involve hard choices from Government, business and individuals.
In the UK, we have shown international leadership in fighting climate change. We have done so through the Kyoto conferences and we will do so again in Bali. We are also introducing the Climate Change (Effects) Bill. Nothing could be a more important signal to the rest of the world that we take the subject seriously. No other country is imposing on itself the emissions limits that we will impose in the UK. People say that 60 per cent. is unambitious, but they merely have to consider how we can achieve that 60 per cent. by 2050 to know that it is very ambitious. Notwithstanding that, if Members say that the aim should be 80 per cent., 90 per cent. or even zero, they can rest assured that we will bring forward in our legislation—I hope that we will have all of their support—a means by which an independent judgment can be made about whether 60 per cent. is the right target or whether it should be higher. We will have an independent climate change committee of experts who will advise the Government on whether we have it right.
The Commission has followed many of the UK’s examples. It has a greenhouse gas emission target for 2020 and a commitment that if we can reach a global agreement, instead of 20 per cent. by 2020, the EU will move to a target of 30 per cent. As I have said, we have led the way in pressing for tight, fair and robust caps for phase 2 of the scheme. Our efforts have led to a renewal of confidence in the EU ETS for phase 2 and beyond. There is consensus in the UK across Government, business and non-governmental organisations that the scheme is a key part of a long-term policy framework to reduce emissions. Many countries, both in and outside the EU, see emissions trading as the way forward to help to drive emissions reductions. It is important that the scheme sets an excellent example. We are heading in the right direction and I am grateful to the Committee for its serious, lengthy and probably quite difficult deliberations and for the good advice with which it has been able to provide us.
4.45 pm
Mr. Yeo: I am conscious that I now stand between colleagues and their enjoyment of a low-carbon weekend. I will not comment on the whole debate, because the Minister has done so very thoroughly, but I want to say how much I appreciate those colleagues from the Environmental Audit Committee who have attended, some of whom have spoken and others have intervened. That has been helpful and supportive and shows how much importance we attach to the report.
I am grateful to the Minister for her kind remarks and generous comments about the report and for those about me and the Committee’s work. She is well respected and well known for her commitment to the environment, and I pay tribute to her for the continuing interest that she has shown in these issues. However, I cannot miss the opportunity of commenting on one or two of her responses. I recall from the distant past that the job of a Minister of State is usually to defend the indefensible decisions of the Government that the Secretary of State does not want to be tarnished with, and I fear that that has been her lot this afternoon, too.
I agree with much of what the Minister said. I wholeheartedly welcome her acceptance that the EU ETS needs greater market scarcity if we are to achieve the sustainable carbon price that we all want. That is absolutely right. I am delighted that Britain will push for more auctioning, and the Government are right to call for a minimum, rather than a maximum, level of auctioning. That is absolutely essential. I am also glad that she recognises that aviation should be subject to more auctioning than has been applied to the rest of the EU ETS. It is good that Britain has pressed for aviation to be included in the ETS, but that will not be good enough if we do not get it in on the right terms. I welcome the Government’s continued interest in that.
I was disappointed by the rejection of hypothecation of revenue from auctions. That is certainly, predictably, the view of the Treasury. It should not be a view that any other Department accepts; it should be the subject of a much more bitter Whitehall battle. I should like to see some leaks about the views of DEFRA and other Departments, attacking the Treasury for its Jesuitical refusal to allow the hypothecation of revenue from auctions. Incidentally, the view is not consistent. We have a television tax that masquerades as the licence fee whose proceeds are hypothecated to one particularly extravagant organisation known as the BBC. Even the climate change levy has an element of hypothecation about its proceeds.
I was pleased that the Minister accepted that business-as-usual projections contained some uncertainties, but I urge her and her colleagues to reconsider the details of what we have said about that and the presentation of the figures. I have doubts. I remember that in the distant past, when inflation was high, public spending predictions used to be produced on what was called funny money, which built inflation into the system. We are in danger of doing the same thing with business-as-usual projections for emissions.
On contraction and convergence, the hon. Member for Morley and Rothwell (Colin Challen) will be as disappointed as I was by what the Minister said about there being no international consensus. Of course there is no international consensus. That is exactly the situation in which I want the British Government to give a lead. They should get out there and start selling that concept to ensure that the post-Kyoto conclusion at least acknowledges—we are not going to get there in 10 years—that as the long-term goal. That is the only fair way, in 30 or 40 years, for the world to distribute the burden of dealing with climate change. The Government have a great opportunity. As I have said, they have shown leadership, particularly under the previous Prime
Minister, as did the Government under Margaret Thatcher. That has exercised a great influence on the world’s view of these matters, and there is a great opportunity to do the same thing with contraction and convergence.
Targets excited a certain amount of comment and controversy. To be fair to my hon. Friend the Member for Bexhill and Battle (Gregory Barker), I think that it was I who said that targets should be 80 or 90 per cent., rather than him. He did not express a precise view about that. I suspect that he might have a view privately, but he is, no doubt, awaiting the final conclusions of the shadow Cabinet on whether it could commit to those levels.
I share slightly the reservations expressed about the endorsement by the hon. Member for Cheltenham (Martin Horwood) of a 100 per cent. target. It is important to remain credible. There are many areas in which we could meet zero emissions targets. The built environment is a prime example; we are being utterly feeble in not getting there much more quickly. Also, on surface transport, we might get very close to 100 per cent., but that is difficult to envisage in some areas. Although it is an admirable goal, I suspect that, at least in the short term, we might find it easier to persuade people to sign up to an 80 or 90 per cent. target than to a 100 per cent. target.
My criticism of the 60 per cent. target is not that it is unambitious. Clearly, it is very ambitious, and at the moment we are not on track to meet it. My criticism is that the science shows that it is inadequate—60 per cent. by 2050 will almost certainly result in an increase in temperature of up to 3 or 4° C, or possibly even 5 or 6° C. The sooner that we recognise that and accept the science the better. The hon. Member for Morley and Rothwell made this point: we must not get hung up on cutting emissions. The focus should be on the overall carbon budget and on the concentration of greenhouse gases in the atmosphere. It is already 50 per cent., which is about the level that has prevailed over the course of human occupation of the planet. It is quite likely that that level is dangerous, but it is increasing at two or three parts per million. Within 20 years, therefore, we shall certainly be at dangerous levels. That is why this situation is very much more urgent than has been recognised.
People who talk about the survival of the planet are making a mistake as well. This is not about the survival of the planet; the planet existed long before human beings. This is about the survival of one species—humanity. The planet will continue after we have disappeared. We arrived very late in the history of the planet, and we might disappear early as well.
To revert to the debate, on carbon capture and storage, to use the Minister’s words, if all the Government’s energies are being used to promote the issue internationally and to set up competitions and so on, I wonder at how little energy the Government have. It is true that no country is doing anything like enough on carbon capture and storage. It is certain that countries such as China and India will burn their huge coal reserves, and unless the world succeeds in tackling carbon capture and storage, almost all our other efforts will be wasted. That is the sine qua non. Without the technologies to deal with the problem cost-effectively, we are almost certainly
done for. I am saying not that Britain has done worse than other countries, but that the efforts of all countries have been scandalously inadequate.
I do not want to embarrass the Minister, but by the look on her face, she agrees that she made the best fist that she could for the Government. Incidentally, I welcome the very recent announcements, but a great deal more needs to be done. I shall touch on the commitment of the Prime Minister to climate change. There was the climate change levy, and there were some encouraging early signs during his stewardship of the Treasury, but I am afraid that the past five years have been pretty disappointing. The freezing of the escalator on fuel duty and the failure to grasp all sorts of opportunities to use the tax system, on a revenue neutral basis, to encourage greener choices were extremely disappointing. Those were great missed opportunities. He has a chance to put that right, but the latest pre-Budget report was introduced three months after he took over as Prime
Minister, and although it clearly showed his willingness to listen to views put forward by other parties, it is a pity that he did not listen to those on promoting greener transport choices through the tax system, for example.
To conclude on a positive note, I believe that the report is important and valuable, and it contains a lot of good recommendations. I am grateful to the Government for their printed response and for much of what the Minister said this afternoon. I wish her every success; I hope that she will be a Trojan horse within the Government for members of the Committee and lean on her ministerial colleagues to get them to move in the direction in which I am sure, in private, she would like to move. I believe that this country will have to move in that direction before very long, and the sooner that we do it, the bigger the advantage that Britain will have politically, environmentally and in business as well.
Adjourned accordingly at five minutes to Five o’clock.
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