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“aviation must meet its environmental costs”.—[ Official Report, 12 March 2008; Vol. 297, c. 473.]
In practice, DEFRA’s optimism about the future ability of nations to tackle climate change and about meeting targets has been wrongly used to create a number that makes it more likely that we will miss those targets. You could not make it up.
Just before the Chancellor mentioned climate change for the first time in his long statement, he made another statement with serious environmental consequences. On house prices, he said:
“The best way to improve long-term affordability and stability is to build more houses”.—[ Official Report, 12 March 2008; Vol. 473, c. 295.]
Many hon. Members would agree, but the Select Committee on Communities and Local Government, the Campaign to Protect Rural England and others have repeatedly cast doubt on whether the Government’s numbers really add up to housing affordability anyway. On purely environmental grounds, however, I should like to draw the attention of the House to the growth assumptions in the Budget:
“UK GDP growth is forecast to slow from 3 per cent in 2007 to 1Â3/4 to 2Â1/4 per cent in 2008, before picking up to 2Â1/4 to 2Â3/4 per cent in 2009 and 2Â1/2 to 3 per cent in 2010.”
Only the last of those numbers is at the level of growth that housing models are using to justify imposing huge numbers of extra houses on areas such as Gloucestershire; 56,000 extra houses are now slated for that county alone. The housing model numbers for Gloucestershire assume a growth rate of 2.8 to 3.2 per cent. sustained consistently for 20 years.
The phrase “In your dreams” springs to mind, especially in the light of the developing global economic crisis. In fact, Northern Rock and the credit crunch have demonstrated the truth of what the Communities and Local Government Committee tried to tell the Treasury two years ago: many other factors in addition to the supply of land influence house prices, including the availability of credit, interest rates and so on. That is particularly true at national level, but there are myriad other factors locally. In my constituency of Cheltenham and the neighbouring borough of Tewkesbury, quite a large quantity of land has been released for housing over the past few decades, adding significantly to the total size of the town, yet we still experience relatively high house prices. That is the case because Cheltenham is still a wonderful place to live; it still has good schools and 98.5 per cent. employment, whereas other areas in the same travel-to-work area do not have such unaffordable housing. The housing market is very complex.
I would be less worried if the Government were sticking to their promise to prioritise brownfield sites in this new housing development, but instead we have the acceleration and promotion of so-called growth points, which have been identified—this is certainly the case in Gloucestershire—in green-belt areas around already relatively affluent towns such as Cheltenham, despite the fact that other areas need and want such development more. The Budget did nothing to prioritise brownfield sites over greenfield where the new housing is needed.
Bob Russell (Colchester) (LD): On the point about brownfield and greenfield land, does my hon. Friend agree that it would help if the taxation system were amended to establish a level playing field whereby VAT was levied on new dwellings and was brought down on conversions and modernisations? Does he also agree that the Government should be introducing policies whereby they look to bring back into use the thousands of empty houses?
Martin Horwood: My hon. Friend has got it exactly right. Clearly, the Government need to do more about empty homes, and he is right about using fiscal or other measures to prioritise brownfield sites over greenfield sites. The importance of the issue in the context of growth assumptions and the Budget’s gloomy growth forecasts is that, if the growth points are established, they will become the only areas that are targeted by developers; if there is a general downturn, developers will end up going to those profitable greenfield sites first, under the growth point policy. We will see development on the green belt first, further damaging biodiversity and the natural environment, and yet again hindering the battle against climate change.
Hon. Members need have no fear, however: help in the battle against climate change is at hand. On Friday, The Guardian announced “Blair to lead campaign on climate change”, stating:
“Tony Blair is to lead a new international team to tackle the intractable problem of securing a global deal on climate change which would have the backing of China and America.”
Presumably, the former Prime Minister is going to do that using the same successful technique that he has used to bring peace to the middle east and unity to Europe—in which case, I think we should be very afraid.
8.36 pm
Bill Wiggin (Leominster) (Con): It is a pleasure to follow the hon. Member for Cheltenham (Martin Horwood), who was right to say that the dash for gas was the reason why the Government have hit their Kyoto targets. Apart from the two Front-Bench speeches, my hon. and learned Friend the Member for Torridge and West Devon (Mr. Cox) and the hon. Member for Nottingham, South (Alan Simpson) both made excellent speeches, and it was a pleasure to listen to them.
One of the most important tests of whether a Government are acting in an environmentally friendly manner and taking climate change seriously is the way in which they are using their fiscal measures to encourage greener behaviour and developments. On that test, the Government have failed miserably. On transport, we heard in Question Time last week that the Prime Minister appeared keen to alter the carbon reduction target to 80 per cent. by 2050. A significant part of the problem that needs to be tackled is the emissions from transport. They account for about 29 per cent. of the United Kingdom’s total carbon emissions.
When it comes to promoting greener forms of transportation, however, the Government are strangling development rather than promoting it. Much play has been made of the so-called showroom tax—a one-year only discourager that would, as it happens, target my constituents who need four-wheel-drive vehicles, as well as large-engined sports cars as are favoured by footballers
and such—and the apparent first-year exemption for vehicle excise duty for cars emitting less than 130 g per kilometre, which is the EU standard. Just as the 2p income tax reduction was exposed last year as a tax con because of the removal of the 10p tax rate, those changes will hit families hard and result in a stealthy tax gain for the Government.
Pretending to be green and using the so-called green taxes to try to fill the massive Government debt black hole will ultimately be damaging to the economy and the environment. Moreover, when it comes to promoting existing greener fuels, the Government are penalising those who are doing the right thing and making the choices that promote sustainable transport use.
In fact, my complaint against Labour’s Mayor and his new congestion charge is that it removes the incentive for alternative-fuel vehicles. That is a great loss, especially for families who need to be able to use cars but cannot bear to use traditional fuel because of its carbon pollution: they now have no choice at all. I am grateful to the Secretary of State for his offer, but sadly there are no family cars emitting less than 120 g per kilometre.
I recently had the privilege of test driving the Vectrix electric scooter, or motorbike. It does not require petrol. It just needs to be topped up with electricity from a socket, although few public electric recharging points are available nationwide. Despite the cleaner technology, the Budget contained no commitments that would encourage the growth of this sector, drive demand and help to make this type of product more affordable. The scooter currently costs just under £6,000, which is about three times more than a similarly performing petrol equivalent, and not much less than a Harley Davidson. We need to do more to encourage that type of technology.
I declare an interest as an owner of a vehicle powered by liquefied petroleum gas. The fuel duty on that greener, cleaner and more efficient fuel has spiralled in recent years, and the proposed increase in the Budget—to come into effect from October—will give little comfort to owners of LPG vehicles or the industry. In 2005, the duty on LPG stood at 9p per kilogramme. The 2006 Budget increased that by 3.21p, or 36 per cent., to 12.21p. Last year’s Budget increased that by another 4.28p to 16.49p—a rise of 35 per cent. And this year’s Budget points to a further increase of 4.28p, which is a rise of 26 per cent. That means that owners of LPG vehicles will, from October, have to pay 20.77p per kilogramme, which is 11.77p more than just three years ago, or an increase of 130 per cent. Similarly, the duty paid on compressed natural gas will soar by 52 per cent. as a result of this Budget, from 9p per kilogramme in 2005 to 13.7p.
Those duty increases are significantly higher in amount and proportion than the 2p increase on petrol, diesel, and bioethanol. There are more than 115,000 owners of LPG vehicles in the UK and the Government will penalise them by more than doubling the amount of fuel duty that they have to pay. That is not a particularly sustainable approach to take.
The Government’s policy appears to be to increase taxes on an area of green growth, instead of encouraging and promoting its expansion. That would also appear to go against the spirit and recommendations of the King review of low carbon cars, which was published
on the same day as the Budget. Professor King highlighted four key challenges for reducing carbon dioxide from road transport. These included reducing CO2 through fuel efficiency and enabling an expansion of low carbon fuels. LPG and compressed natural gas fulfil those functions. The King review comments that there should be an:
“increased use of alternative fossil fuels such as LPG and CNG which can both offer small but significant life-cycle CO2 savings over petrol and diesel. Cars capable of using LPG or CNG currently represent less than 1 per cent of the total car stock but there is scope to expand their use.”
The Chancellor in his speech on Wednesday said:
“Professor King found that simply by switching to the cleanest cars on offer, motorists could save 25 per cent. of their fuel costs”—[ Official Report, 12 March 2008; Vol. 473, c. 297.]
but by trying to cash in on the growth in LPG and CNG use, that 25 per cent. saving may not be as great, and the Government run the risk of failing to promote the cleaner fuels that more people need to use to achieve significant reductions in the carbon footprint of transport. The Government have their hands around the necks of LPG and CNG users, and are getting ready to throttle them. This was not a green Budget, but a green stealth tax Budget.
Turning to the issue of biofuel and its environmental potential, the Budget has again failed to address the inherent weaknesses in Government policy towards this fuel. In spite of widespread criticism, the Government are pursuing the renewable transport fuel obligation to increase biofuel use, but, because the sustainability criteria have not been produced—if indeed they are developed at all—the relentless growth in biofuels may continue in an irresponsible way. We have seen the push for biofuels, particularly in the USA, leading to significant increases in food prices. In the last year alone, the price of corn has risen by 31 per cent., of soya by 87 per cent. and of wheat by 130 per cent. That has a knock-on effect right the way down the food chain. The consumer is hit with higher prices, and the rise in prices is also forcing domestic farmers into financial difficulties. Pig farmers are being especially squeezed, with the cost of feed doubling in the last year alone. If the industry does collapse, cheaper imports of animals reared—this is very important—to lower welfare standards will flood the domestic market adding to shoppers’ carbon footprints.
The problems associated with the unsustainable growth of biofuel extend beyond food prices in the farming sector. The demand for palm oil for use in biofuels as well as in food and cosmetics is leading to the destruction of the rainforests of Borneo and Sumatra. As much as 10 million hectares of habitat could be lost, and that is having a devastating impact on orang-utan populations, which might be as low as 7,000 in Sumatra. They could face extinction within five years.
I must take this opportunity to pay tribute to the roundtable on sustainable palm oil, which is a fantastic initiative designed to ensure that the palm oil that we buy is from sustainable sources that also live up to the standards on issues such as human rights and exploitation that we would expect from our major retailers.
However, despite my warm words, things need to move faster. I am warned that it might be only five years before we lose our sustainable population of orang-utans in the wild. It may take that much time to get sustainable palm oil on to our shop shelves. I fear that if palm oil comes into our fuel tanks without awareness among the general public, an explosion in the demand for that palm oil would quickly lead to the loss of those great apes. Sime Darby, a major palm oil producer that seeks to ensure that it can deliver sustainable palm oil, has invited me to visit Malaysia and Borneo to see what is being done to preserve the habitats of those great apes. I also congratulate those firms that have already changed their buying policies to include palm oil from sustainable sources.
We hear many pronouncements about globalisation and the Budget in terms of the financial markets and economic impacts, but the Budget also has an important role to play in contributing to the sustainability of world resources, rather than their over-exploitation. I note the review into the wider environmental and economic impacts that has been announced, but that piece of work should have commenced earlier. Moreover, it remains unclear whether sustainability standards and targets will be in place or when they will become applicable.
Back in October, during the debate in Committee on the Renewable Transport Fuel Obligations Order 2007, the Under-Secretary of State for Transport, the hon. Member for Poplar and Canning Town (Jim Fitzpatrick), stated that the date for sustainability targets was 2011 and that that was just an aspiration. The Budget has thus far failed to elucidate any further on that quasi-commitment. We need to be clear that biofuels can be a positive step forward in the fight against climate change if they are sourced in a responsible and sustainable manner.
It is not just in the area of fuel duty and biofuels where a more sensitive and targeted approach could have been beneficial to the environment and consumers. As chairman of the all-party cider group, and someone who represents a constituency in England’s cider-producing heartland, I have followed with interest and sadness the rise in duty on cider. It is disappointing to see that the Government have decided to clobber all cider drinkers and producers when they could have taken a more targeted approach.
I am sure that all right hon. and hon. Members are familiar with the problems of binge drinking. We all see the disruption and antisocial behaviour that a minority of reckless and irresponsible drinkers cause in our town centres. However, instead of using the Budget to take action against the minority who cause the problems and raising duties on the higher strength alcoholic products, which are among the cheapest and most affordable, the Government are hitting everyone. The Opposition have put forward proposals on alcohol taxes that would take effective action against the irresponsible minority and make higher strength ciders and other similar alcoholic drinks more costly to buy, but would not impact on the majority of the country’s 37 million responsible drinkers who consume medium and low-strength alcoholic beverages.
The Government might not have realised it, but their approach to alcohol taxation, which is to penalise all types of cider and mass-scale cider producers, such as
Bulmers and Westons in my constituency, has a negative impact on the environment. Cider is a domestic success story with more than 1 billion pints now sold each year. That success through rising demand has lead to widespread investment in sustainable environmental practices. Cider producers take great pride in ensuring that their chemical, water and energy uses are kept to a minimum.
In Herefordshire, Bulmers is a lead partner in delivering the county’s biodiversity action plan. Two million cider apple trees have been planted in more than 5,000 acres of land in recent years. Green, environmental and sustainable practices are awarded through industry-led initiatives such as the golden apple awards. Instead of using the Budget to support medium and lower-strength ciders, and recognising the benefit that cider producers bring to our environment, the Government are treating a British success story like a piggy-bank that they intend to raid.
Mr. Nigel Evans (Ribble Valley) (Con): My hon. Friend is defending the cider industry, a great British industry that is based in his constituency, but will he defend another great British industry, the British pub, which sells that product? As a result of the blunderbuss approach that has been taken to taxation, all alcohol has been hit, as my hon. Friend says. Pubs are closing at a rate of four a day, and the changes announced in the Budget will be the death knell for yet more of them.
Bill Wiggin: I absolutely agree, and I know that my hon. Friend has worked extremely hard with the pub trade to ensure that people in the House understand the problems that publicans and brewers face. It is fair to say that almost everything that I have said about cider applies to beer. A huge amount of hops are grown in my constituency and contribute to the beer industry. What he says about the lack of targeting absolutely chimes with the message of my speech. The Government had a unique opportunity to tackle the antisocial behaviour agenda, which I know they care about, but they missed a trick, which is a great shame.
At a time when fuel and food imports are rising and the cost of living is increasing, when British taxpayers and families are facing record burdens of taxation, and when the Chancellor of the Exchequer is more concerned with protecting the Prime Minister’s disastrous handling of the nation’s finances than improving the national economic outlook, we, as a country and as individuals, may not be best placed to put this country in the leading position that it needs to be in to tackle climate change and promote the environment.
8.51 pm
Justine Greening (Putney) (Con): It is a pleasure to wind up the debate on behalf of the Opposition, particularly on a topic as important as this year’s Budget and the environment. This has certainly been an interesting debate about a Budget that probably shows the Government at their worst—ham-fisted, misguided and deeply cynical—and that damages the electorate’s trust in them.
We have heard many interesting contributions, and I shall come to them shortly, but first it is worth reflecting on what we heard about the Budget from the Secretary of State. The reality is that whatever his
warm words, and however good his intentions, the Government have put forward a Budget that was more about eco-spin and raising revenues than doing anything meaningful to protect the environment. The Secretary of State may think that I am being uncharitable, but my concerns are mirrored by many outside the House.
In fact, it seems that virtually nobody was happy with this year’s Budget. Both the business community and environmental lobby groups saw it as deeply inadequate. Chris Sanger of the accounting company Ernst & Young described it as
“a hotchpotch of measures which is indicative of a Budget without a key theme.”
Tony Juniper of Friends of the Earth said:
“The chancellor promised to put sustainability at the heart of today’s announcement, but he has merely tinkered in the margins.”
John Sauven of Greenpeace talked about the Chancellor
“dropping the ball on climate change”
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