The position that I have found myself adopting as I listened to the debate is one of considerable surprise, because there appears to be an emerging consensus. My hon. Friend the Member for East Surrey (Mr. Ainsworth) advanced the proposition that there was a lack of coherence and vision in the way the Government, and particularly the Chancellor, initiated their environmental measures. It was somewhat surprising that perhaps the majority of Labour Back Benchers agreed with my hon. Friend. In an excellent speech, the hon. Member for Nottingham, South (Alan Simpson) put his finger on the problem: what is lacking in the Budget is a sense of
vision and a coherent understanding of the necessity not for a few piecemeal and fragmented measures but for a coherent policy.
My right hon. Friend the Member for Wokingham (Mr. Redwood) said that Budgets should be about grand orientations. This Budget was not a grand orientation towards environmental policy as a driving factor in economic strategy. It was about a number of tax-raising measures that seemed to have the cloak and disguise of being green, but did not have a centre and a heart. The hon. Member for Nottingham, South put it well when he said that behind the Budget there did not seem to be any central vision.
I have been asking myself as I have been listening to the debate why it is that the constituents whom I represent, in the largely rural areas for which I have the honour to be the Member of Parliament, should feel so cynical about the Budget that was introduced by the Chancellor last week. I think the answer is that, when they hear the Chancellor and the Secretary of State, they do not believe that the Government have a grasp of the integral elements that they will require to put through a genuinely environmental and green agenda.
In my constituency, we areto use the word threatened is perhaps to prejudge and prejudice the issue, but I will say it anywaythreatened by many applications for gigantic commercial wind turbines. The response, as the Secretary of State would expect in the area of west Devon that I represent, is almost universal hostility. These are not unreasonable people; if they were convinced of the urgent necessity, in the interests of our country and of the world, for renewable energy to have an adverse and unwelcome impact not only on the quality of their lives as they see it but on their businesses, their bed and breakfasts, their restaurants, their tourism industry, their tranquillitybecause I have the honour to represent one of the last areas of rural tranquillity in England
Martin Horwood: Do the hon. and learned Gentleman's constituents not recognise that their tranquillity, well-being and economic success are threatened by climate change in the long term, which is a far more serious threat than a wind turbine, and that wind energy is an essential part of tackling that problem?
There is now a proliferation of applications for gigantic wind turbines in the rural area I represent, and they are being greeted with consternation and dismay by the inhabitants of the places to which they shall come. The thesis I offer to the Secretary of State is not about whether they are right or wrong; it is, rather, that if we are to convert people to a belief in the need for this type of renewable energy, we must harness their popular assent, but people will not believe in the need for such intrusive forms of technology unless they believe that the Government have a coherent underlying vision and unless the Government convince them of the urgent need for them. That has not been done in the run-up to the Budget.
If there is a coherent vision uniting all the relevant aspects of government, why has a feed-in tariff not been adopted before now to encourage microgeneration? I
am a member of the Environment, Food and Rural Affairs Committee. We looked into this last year, and we considered that it represented a powerful means of encouraging microgeneration, but why is it that only now do we have a commitmenteven though it appears to be only lukewarmto look into a feed-in tariff?
The respective benefits of a feed-in tariff and the current low-carbon buildings programme simply do not match up; I think that the Secretary of State agrees with that. Frankly, the low-carbon buildings programme has been a failure. It has produced solar voltaic panels in 270 houses. In Germany, 130,000 households took up such panels in the last year alone. That situation is reflected across all the diverse range of renewable energies. The low-carbon buildings programme is bureaucratic, it has too many conditions and it is not worth it. I recently had solar thermal panels installed in my home. I looked into the low-carbon buildings programme, but it was too much hassle, there was too much bureaucracy, and there was too little money because the grants simply are not high enough. Therefore, I agree with the Secretary of State that the way forward is a feed-in tariff. If it is set correctly, it is likely that there will be an explosion of interest in microgeneration. There are hundreds of thousands of such households in Germany. It is becoming standard in some German states for there to be some form of renewable energy in a household, but not in this country.
If my constituents see that there is a comprehensive and coherent Government policy that deals with all aspects of renewable energy and allows them not only to be taxed but to gain from renewable energy by a sensible feed-in policy, they will be much more likely to give their assent to intrusive technologies as part of an overall package of measures. However, they are likely to become cynical if they see only a Klondike-style gold rush of large-scale commercial wind companies coming to their villages and communities to erect 400-ft tall wind turbines and nothing elseno way they personally can become engaged in the battle to fight climate change, but simply the profits disappearing a long way from their communities. Similarly, when they see the Budget measures for green taxation, they are likely to become cynical because they do not sense that the Budget has introduced its environmental measures in the service of some coherent grasp of what is necessary. They sense only that it is another stealth tax-raising measure.
There is a problem of credibility and belief. Only if people see an underlying profound sense of purpose in Government policy will they give their assent to the unpleasant bits. Only if they also see that the policy is not all unpleasant bitsnot all stick, but that there is carrot, too, as part of a subtle, comprehensive policy of the type I describewill they give their assent, and their enthusiasm, to it.
I passionately believe that we need to harness the will and popular support of the people of this country. We cannot preach to them. We cannot simply expect them to accept having foisted on them unwelcome and intrusive technologies such as wind turbines that frequently damage the communities they are sited infor instance, in terms of the effect on tourism and the perception at least of an effect on the quality of life of the communities. We cannot expect them to take those measures and to take the taxation as well.
I remind the Secretary of State that across my constituency, which as he knows is extremely rural, there are many hundreds of farming communities and farming people have little option but to use a strong 4x4 vehicle to perform many of the intensive tasks that are required to be done on often remote land. Yet those who go to buy a new Land Rover after the relevant change comes into forcetomorrow or next month or whenever it will bewill find that they have to pay an extra £950 or £1,000, and they will feel that they are simply on the receiving end of repeated blows from the Government. The only way they would accept that is if they felt that behind it there was a coherent vision and purpose, and a sense that the Government were sincere in what they were doing in these Budget measures.
However, people do not feel that. They might be wrong; it might very well be that the Secretary of State and the Chancellor are sincere in introducing these measures and really believe that they will have a benevolent effect on carbon emissions in this country. I accept that entirely, but we will not win the assent of the people of this country if we do not show them that we are bringing forward policies with a profound sense of purpose, such as that which the hon. Member for Nottingham, South so ably demonstrated in his speech.
That is why I ask this question: if there is a coherent vision, why over the past decade or so since this Government came to power has a feed-in tariff not been examined and brought forward? If there is a coherent vision driving the Governments policy on the environment, why only now in the Energy Bill is the banding of the renewables obligation certificate being introduced? A criticism that has been made for many years is that because renewable energy technologies are in different states of evolution, and particularly because onshore wind is in an advanced state of evolutionit is ready nowthe renewable energy obligation favours the established technologies. I welcome the proposals to band the renewables obligation, but why is it being done 11 years after this Government came to power? Why was it not done much earlier?
If the country communities I represent had seen those kinds of measures brought forward some years ago, it might have been easier to win them over to the cause of renewable energy generally, and to get them to accept the intrusive and often unwelcome installation of gigantic wind turbines with which they are now threatened.
It is a serious criticism of this Budget and of the Governments entire environmental policy that it seems to be fragmented and piecemeal and not to be driven from the heart by a profound underlying purpose that is able to win over and convince the people of this country. If it is not done in that way, there is a danger that people will be alienated from the cause of
addressing climate change. The danger is that we will make them cynical and play into the hands of those who doubt even whether there is something that mankind can and must do. I firmly believe that there is something that mankind can and must do to resolve this important, nay, most pressing problem.
I have the great honour of having James Lovelock, with whom I have had many conversations on these subjects, as both a neighbour and a constituent. He is a convincing exponent, as the Secretary of State will know, of the important and urgent need for action. I endorse and support what the hon. Member for Nottingham, South said. If this issue is indeed as serious as the Government say they believe it is, it will require an adjustment of our national policy in many fields, and food security is most certainly one of them.
I should point out to the Secretary of State that the criticisms of the Budget are not intended as suggestions that there is not commitment to this cause on a personal level on the Government side. However, unless the Government can get their act together, bring the disparate elements of environmental policy together and go forward to convince people with the same passion and purpose as the hon. Member for Nottingham, South, this policy will fail to win the critical and crucial assent of the people of this country. Simply imposing taxation measures such as those in this Budget will do more than anything else to harm the cause of winning the battle of hearts and minds regarding climate change.
Martin Horwood (Cheltenham) (LD): My main concern today is addressing environmental issues, but I shall begin by addressing another issue that is important to some of my constituents. Cheltenham is known to like a flutter or two, and Denmans breathtaking win in Fridays Gold cup certainly cost me a bit of pocket money, as I backed Kauto Star. If you will indulge me, Mr. Deputy Speaker, I will seize this opportunity to put on the record my congratulations to Edward Gillespie and everyone involved in the festival in Cheltenham for having put on such a wonderful show this week, despite extremely challenging circumstances at the beginning of it.
The bookies certainly looked pleased at the end of their week, despite having lost a day of racing due to the high windsbut at least they are taxed only once. Bingo clubs, like clubs at The Brewery, in my constituency, pay both VAT at 17.5 per cent. and gross profits tax of 15 per cent. They feel that this is not a level playing field. Not only was this issue not tackled in the Budget; the Chancellor took the opportunity to increase amusement machine licence duty above the rate of inflation, thereby adding to the pressure on an industry that is already suffering.
I am not arguing that bingo clubs are on a par with post offices in their value to the community, but they do seem to be closing at a similar rate. Having visited clubs in Cheltenham, I am satisfied that they perform an important social function, particularly for some of the less well-off communities and older members of society. I am also convinced that patrons generally bet only what they can afford. Therefore I hope that future Budgets will look more kindly on the bingo industry.
We were promised a green Budget. That would have been timely, as the United Nations environment programme has just reported that the rate of glacier shrinkage appears to have doubled in less than a decadea grim addition to the already worrying body of scientific evidence about climate change. Yet actually, the Chancellor was three quarters of the way through his speech before he even mentioned the environment or climate change. We then had the traditional series of re-announcements. Amazingly, there was the re-announcement of the Climate Change Bill, which I thought we all knew about, and there was more about the Bali conference and more about low-carbon buildings by 2016. At one stage, the Chancellor even seemed to be taking credit for the European emissions trading scheme.
We had the usual complacent restatement of the Governments meeting their Kyoto targets. My hon. Friend the Member for Northavon (Steve Webb) has already pointed out quite how dangerously complacent that is, given that, according to the National Audit Office, simply using another accounting method that properly accounts for aviation and shipping shows that we have seen an increase in greenhouse gases under this Government. In fact, if we look at the figures since 2002, it does not matter which of the methodologies we usethe situation is getting worse. Of course, we all know that this great claim of the Governments to have met the Kyoto target is really only a result of the original dash for gas, which took us down below the Kyoto target many years ago.
ambitious household emissions reduction programme[ Official Report, 12 March 2008; Vol. 473, c. 296.],
which I guess was an attempt to resurrect the shambles of the low-carbon building programme. On that, if not on much else, I agree with the hon. and learned Member for Torridge and West Devon (Mr. Cox), who criticised the way in which that scheme worked in practice.
Then we had the non-announcement on vehicle excise duty, which will have no impact whatsoever until the financial year 2010-11. Among all this, strangely, there was no mention of the savage budget cuts to green projects such as the National Industrial Symbiosis Programme and the Waste and Resources Action Programme. Such cuts make it highly unlikely that business will be able to continue to improve its performance on waste reduction, in the way that it was able to do with the assistance of those two organisations.
Of course, the Budget cuts across Departmentswe cannot put the environmental bits in one box marked DEFRA/Treasury. Other Departments are critically involved in terms of their impact on the environment. When challenged earlier, the Secretary of State dodged a question on carbon capture and storage by saying that it is a matter for the Minister for Energy. Well, it is relevant to an economic debate. As the Treasury document that accompanies the Budget, entitled The UK economy: analysis of long-term performance and strategic challenges makes clear, climate change, energy policy and the future performance of the UK economy are inextricably linked. That document states:
The Government will also seek to ensure that the UK makes the most of the potential economic benefits of the transition to a low carbon economy...It will...develop a low-carbon energy technology strategy to maximise the cost-effective potential for cutting emissions in the UK and internationally.
During recent consideration in Committee of the Energy Bill, the Minister for Energy resisted a whole series of amendments that would have helped us move toward a low-carbon energy strategy. He even resisted enabling powers to introduce feed-in tariffs, which have already been mentioned today. He resisted amendments to lock carbon capture and storage into the development of a new generation of coal-fired power stations, led by Kingsnorth. He even resisted amendments that would have allowed him to broaden out the current competition launched by the Government for carbon capture and storage technology, which has been widely criticised as being too narrow and slow and has actually precipitated the truncation of an important carbon capture and storage project by BP at Peterhead. BP had already spent tens of millions of pounds of its own money on the project, which would have been on line ahead of the Governments competition project. All such amendments were rejected in Committee.
The same Budget document to which I referred also extols the virtues of the shadow price of carbona measure that will be used to reflect the future cost of climate change in deciding on projects that are outside the carbon trading system. It states:
the Government will use the new Shadow Price of Carbon to ensure that the carbon impacts of policieswhether negative or positiveare taken into account systematically and consistently across Government.
There is no dodging thisit was developed by DEFRA. However, this is the same shadow price of carbon that the Environmental Audit Committee recently concluded reflected serious flaws in DEFRA thinking. Our recent report on the 2007 pre-Budget report and comprehensive spending review concluded that
the Shadow Price of Carbon is set considerably lower than the level which Stern set for a business as usual trajectory of emissions. In other words, by assuming that action will be taken to ensure that the effects of climate change will be relatively mild, the paper
concludes that the costs of climate change are relatively low. In doing this, however, it is setting a relatively low carbon price...The risk is
that this will fail to discourage the approval of policies and projects that will lead to a growth in carbon emissionsand thus help to make it more difficult to achieve the stabilisation target that the paper assumes will be met.
are using this lower figure, which has the effect of making carbon emissions go up, which means that they do not meet the targets that they are assuming are being met through the use of the shadow price...It is almost Orwellian.
I would quibble only with the word almost. This is surely the most perfect example ever seen of a self-defeating policy. Sure enough, it made all the difference in the decision to give the go-ahead to the third runway at
Heathrow. Astonishingly, the Chancellor mentioned that decision approvingly in the same breath as stating that