Climate Change Bill [Lords]

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Gregory Barker: I understand the Minister’s argument, but he has said some things that are slightly troubling, which I will return to. Indicative annual ranges can take into account varying circumstances or unforeseen events, to which the Minister has alluded. The Committee on Climate Change, which I hope will be made up of eminent but sensible people, will be able to take that in its stride.
I find it slightly strange that the Minister mentioned housing numbers as an unforeseen circumstance. It is odd to think that we might suddenly be taken by surprise at the number of houses built in any one year, as I imagine that the Government can foresee the likely number of new houses or dwellings that will be occupied. The weather, I agree, is out of their control, but I expect them to have a firmer grip on the housing stock. The Minister has alluded to severe winters, but there are mild winters, too. We are more likely to experience milder winters than severe ones as global warming continues apace.
The crux of the issue is the Minister’s suggestion—albeit implicit rather than explicit—that targets should follow policy rather than policy should follow targets. He seemed to imply that it was not for the committee to set policy and that we should therefore not have indicative annual targets, because the policy may direct or produce something rather different. Clearly, it should be the other way round. We should have indicative annual ranges, which have inherent flexibility, and policies should be designed to meet those ranges rather than putting the ranges in place once we know the policies. The policy is the servant, not the master, of indicative annual ranges and the overall carbon budget. The danger with that slightly lazy thinking is that it makes for less ambitious policy making and for the slight sense that there is get-out-of-jail-free flexibility on the targets, particularly if in the two or three years of the near term there is some doubt whether the indicative ranges of the short-term trajectory will be met. The trajectory should be the real spur to more ambitious policies by Governments of whatever political hue.
Amendment, by leave, withdrawn.
Gregory Barker: I beg to move amendment No. 54, in clause 12, page 6, line 41, leave out from ‘which’ to end of line 43 and insert
‘the net UK carbon account for the year must fall in order to meet the carbon budget for the relevant budgetary period’.
Amendment No. 54 directly relates to our previous discussion. It is informed by our concern that indicative annual ranges could be politicised, particularly in a period of likely political change, when the end of the carbon budgeting period would be likely to fall within the term of a new Government. That could lead, if not to political shenanigans then certainly a lack of ambition or other priorities on the part of the Government of the day, whoever they are.
To prevent that situation from arising, we have tabled amendment No. 54, which would put a requirement on the Government to produce an annual range that is tight enough to meet the trajectory required to meet the carbon budgets. As clause 12 stands, all that the Government need to do is predict where the carbon account should be in any given year. Amendment No. 54 would ensure that the annual range is set so as to fall inside the net carbon account for that budgetary period, which would necessitate tightening the annual range to a more meaningful figure.
We are not a long way apart from the Government. Indeed, Lord Rooker, during the passage of the Bill through the Lords, said:
“We need a system of annual accountability that can deal with these real-world fluctuations and uncertainties but which still provides sufficient clarity about progress to ensure that the Government of the day can be held to account appropriately... setting out an indicative range for the net UK carbon account for each year of the budget period... will ensure that Government of the day can be properly held to account for progress during each year of the budget period, not just at the end of the period.”—[Official Report, House of Lords, 25 February 2008; Vol. 699, c. 497.]
That is the crux of amendment No. 54. We believe that tightening the annual ranges to a more meaningful figure will help the Government of the day and inform this legislation.
Mr. Mike Weir (Angus) (SNP): I have a lot of sympathy with the hon. Gentleman’s point, but, given the earlier discussion on the ability of Ministers to amend the carbon budget within the five-year period, how would his amendment fit within that, as it would mean that the range has to show a fall within each year of the five-year budget?
Gregory Barker: I will repeat the amendment for the hon. Gentleman:
“the net UK carbon account for the year must fall in order to meet the carbon budget for the relevant budgetary period”.
That is what we need to be aiming for. If that budget were not met, an adjustment would be required in the following year, but we should not anticipate that the budget will rise or that the trajectory will be anything other than down.
We all accept that there could be unforeseen circumstances, but we do not accept that there are foreseen circumstances in which we would anticipate a rise in the budget. If we can see factors that are likely to push up carbon emissions, we should take other actions ahead of time in other parts of the economy to depress carbon emissions. The whole point of flexibility is to allow us to deal with unforeseen events, which can only be addressed with the benefit of hindsight.
Steve Webb (Northavon) (LD): Will the hon. Gentleman help me with my understanding of the clause, because I have become more confused? In subsection (2), does “fall” mean decline? It means fall within a range—in other words, the provision states that an indicative annual range is a range within which the figure must fall. That does not mean that the figure must go down; it just means that the figure must fall within the range. Am I right in that understanding?
Gregory Barker: The hon. Gentleman is correct, but so too is the assertion that the trajectory must be met. Obviously, the trajectory is declining, and we do not anticipate that it will rise. The only reason why it would rise is unforeseen circumstances. Does the Minister foresee any circumstances in which we would anticipate the trajectory rising and not take preventive action?
Mr. Woolas: My understanding is the same as the hon. Gentleman’s—“to fall” in subsection (2) means to lie within the five-year budget. I cannot envisage circumstances in which the trajectory would not fall, unless the American presidential election throws up something really unexpected.
Gregory Barker: I thank the Minister for that clarification, and it has been useful to raise our concerns. I am looking forward to what the Minister has to say on amendment No. 54.
Mr. Woolas: I am grateful to the hon. Gentleman for tabling a helpful amendment. The amendment sounds like common sense, but I did a bit of digging and the issue boils down to the difference between “expects” and “must”. Let me explain—my argument is convincing and I am going to use maths.
The clause requires the Secretary of State to set out the indicative annual range within which he “expects” the net UK carbon account to fall—to lie within—for each year of the budget period. Amendment No. 54 would change that to the range within which the net UK carbon account “must” fall to meet the carbon budget. I consider the amendment unnecessary, given the existing provisions in the Bill about both the Government’s duty to meet the five-year carbon budget and the strong framework for annual accountability. By inserting “must”, the amendment would effectively change the budgetary period to an annual one, which is not the intention.
Let me explain the practical problems.
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The way in which the Bill is worded makes it clear to Parliament, and to everyone else, whether the Government are taking the necessary actions throughout a budgetary period to ensure that the budget is met, but the Government will not be acting unlawfully if emissions increase, although I imagine that they could increase only slightly beyond the level that the range sets out. Underpinning that, clause 5 places a duty on the Government to ensure that the net UK carbon account for a period does not exceed the carbon budget—the five-year period.
That means that the indicative annual ranges will effectively have to be set with a view to meeting the budget. No matter where we are within the range each year, at the end of the period we must still meet the budget. In addition, there is the strong annual framework that I have spoken about. Under clause 35, the annual report by the committee must set out, inter alia, whether the budget is likely to be met. That is part of the process which, I think, the other place urged upon us; certainly, the pre-legislative scrutiny Committee did.
I am not sure how amendment No. 54 would work in practice, as there would be both a budget that had be met and a range for each year, which also had to be met. The range recognises that emissions fluctuate—we are agreed on that—so it would be possible for the net UK carbon account to lie within the range for each year of a budget, but for the total net carbon account to exceed the budget at the end of the period, because if we hit the top of the annual range each year, that would, by definition, be greater than the five-year budget. There is, therefore, a practical problem with changing “expects” to “must”. My argument is that it essentially makes the annual period the budget and not a range, and mathematically, the possibility of hitting the top of the range for each of the five years would defeat the five-year budget target, which is more important.
Mr. Gummer: That is a good explanation. Perhaps the Minister would be kind enough to recognise the thought behind this amendment and others, which was admirably expressed by the hon. Member for Angus. If one looks at how the Bill must be written, the Government should be able to make alterations, which may be up or down. Those of a cynical disposition might say that that is all very well, but if the Government were so minded, they could defeat the whole purpose of the Bill. We know that it would be difficult, within the parliamentary arrangements, for that to happen. It would be helpful, however, if the Minister undertook to identify other parts of the Bill that exemplify the points that he made in accepting the reasonable nature of the amendment. This is one of those occasions where we must ensure that we are getting it right and meeting public expectations. I have some sympathy with what the hon. Member for Angus said, both today and in previous sittings.
Mr. Woolas: I have been reflecting that perhaps The Guardian is even more cynical than the Daily Mail. It certainly puts me in a worse mood. I can do what the right hon. Gentleman requests. I do not believe that in the other place there was a challenge to the point that he makes. I made reference to the interrelationship with clause 5.
I shall briefly put my mathematical argument, which I think is a convincing one. Let us say that the relationship between a range within which emissions must fall and an overall budget did not work. Suppose the budget is 100, and for each year of the period the range is set between, for the sake of argument, 15 and 25. If the net carbon account for each year was 23, 22, 24, 25 and 21, we would still have complied with amendment No. 54, which states that the net carbon account “must” fall within the range, but we would have missed the five-year budget.
Martin Horwood (Cheltenham) (LD): The Minister’s maths are good, but his politics are less good. The annual targets do not release the Government from the obligation to meet the five-year budget. The mathematical possibility that the top of the range could be hit five years running and the budget therefore missed does not mean that the budget must not be met. That still applies. There are two sets of complementary targets. Of course, if the top range of the budget for the annual targets were hit repeatedly, budgets in later years would have to be made tighter and lower.
Mr. Woolas: That is why I said that the problem is the word “necessary”. The amendment is unnecessary because of the point made by the hon. Member for Bexhill and Battle. By inserting the word “must”, a duty is placed on the Secretary of State under clause 12 that could be used to override the obligation that we spent three hours debating earlier. It confuses budgets and annual ranges.
Martin Horwood: Again, the Minister is mathematically right but politically wrong. The problem is not that the maths do not add up, but that they would need to be added up only after the subsequent general election. By supporting the amendment together with the Conservative Front Benchers, we seek to hold the Government more precisely to account on an annual basis.
Mr. Woolas: I am glad the hon. Gentleman accepts my maths, even if he does not agree with me on the policy. I do not believe that the amendment achieves what he wants it to do. In fact, it could achieve the opposite. In the run-up to a general election, the Government could set the annual indicative figure at the top of the range. That would be within the law under the amendment, but outside the law under the earlier obligation to meet the five-year carbon budget. That would create political confusion. Precisely because I do not want to do that, the amendment is unnecessary.
The amendment would take us into an area where the annual indicative range would effectively become an annual budget. That is not what we are trying to achieve here or in the other place. I hope the hon. Gentleman accepts that my policy is right, that my politics are right and not particularly partisan, as this will happen in the future, and that clause 5 overrides the need for amendment No. 54.
Clarity is desirable, but I accept that the amendment may not be the best way of achieving that. We will look again at the issue. In an ideal world, there remains a case for tighter, clearer and more effective annual indicative ranges within the context of a finite five-year carbon budget. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question proposed, That the clause stand part of the Bill.
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