Public Service Agreements
53. Public Service Agreements (PSAs) were introduced
in the 1998 Comprehensive Spending Review (CSR). Through PSAs
the Treasury assigns Government Departments and Agencies various
policy objectives, and sets delivery targets to measure performance
in implementing them. The 2007 CSR replaced all existing Agreements
with a set of 30 new PSAs. These included two with specific reference
to the environment: PSA 27, "Lead the global effort to avoid
dangerous climate change", and PSA 28, "Secure a healthy
natural environment for today and the future". For each of
these Agreements the Treasury has set out a number of individual
areas in which progress will be tracked, to build up a picture
of how well the overall objective is being delivered (BOX
1).Box 1 Key
measurement indicators for PSA 27 and PSA 28
| PSA 27: Lead the global effort to avoid dangerous climate change
| PSA 28: Secure a healthy natural environment for today and the future
|
Indicator 1: Global CO2 emissions to 2050
Indicator 2: Proportion of areas with sustainable abstraction of water
Indicator 3: Size of the global carbon market
Indicator 4: Total UK greenhouse gas and CO2 emissions
THERE ARE LONG-TERM NATIONAL TARGETS ATTACHED TO THIS INDICATOR: TO REDUCE UK CARBON EMISSIONS FROM 1990 LEVELS BY 26-32% BY 2020 AND AT LEAST 60% BY 2050.
Indicator 5: Greenhouse gas and CO2 intensity of the UK economy
Indicator 6: Proportion of emissions reductions from new policies below the Shadow Price of Carbon
| Indicator 1: Water quality as measured by parameters assessed by Environment Agency river water quality monitoring programmes.
Indicator 2: Biodiversity as indicated by changes in wild breeding bird populations in England, as a proxy for the health of wider biodiversity.
Indicator 3: Air quality—meeting the Air Quality Strategy objectives for eight air pollutants as illustrated by trends in measurements of two of the more important pollutants which affect public health: particles and nitrogen dioxide.
Indicator 4: Marine health—clean, healthy, safe, productive and biologically diverse oceans and seas as indicated by proxy measurements of fish stocks, sea pollution and plankton status.
Indicator 5: Land management—the contribution of agricultural land management to the natural environment as measured by the positive and negative impacts of farming.
|
Source: HM Treasury, "2007 PBR CSR: Public
service agreements", http://www.hm-treasury.gov.uk/pbr_csr/psa/pbr_csr07_psaindex.cfm
54. PSA 27 replaced the previous PSA on climate change,
shared by Defra, BERR, and the Department for Transport (DfT):
"To reduce greenhouse gas emissions to 12.5% below 1990 levels
in line with our Kyoto commitment and move towards a 20% reduction
in carbon dioxide emissions below 1990 levels by 2010, through
measures including energy efficiency and renewables."[75]
We have some concerns about this. First, in
bringing the previous Public Service Agreement on climate change
to an end, the Treasury did not publish an assessment of Departments'
performance against it, along with any actions for improvement.
This is despite the fact that the previous target to reduce UK
CO2 by 20% by 2010 looks set to be missed by a wide
margin. (UK CO2
emissions were only down by 6.4% on 1990 levels in 2006, or 12.1%
down if the purchase of 33 million carbon credits is treated as
reducing UK emissions by a further 33 million tonnes;[76]
latest projections are that they will be around 11% down on 1990
by 2010, or around 16% down if the projected purchase of around
30 million carbon credits is taken into account.)[77]
This suggests
either that there is a weakness in the design and operation of
the PSA system, or that the Treasury is less interested in driving
progress on reducing carbon emissions than other objectives.
55. A second concern is that the
new PSA on climate change is too diffuse, with no clear departmental
targets for reducing emissions, and less emphasis overall on reducing
emissions from the UK—this, after all,
is only one of six performance indicators. We have in the past
criticised the previous climate change PSA for not assigning enough
accountability to the individual Departments which shared it.
In the case of the Department for Transport, for instance, this
meant we viewed the PSA it shared with Defra and BERR as:
[…] failing as a mechanism that might shine
a light on the Department's efforts and hold it to account. […
DfT's 2006 Annual Report] solely gives the collective progress
against the Kyoto target and 2010 domestic targets. At no point
does the Department quantify the carbon emissions resulting from
transport as a sector, much less report that transport is the
only sector in which emissions have been rising consistently since
1990 and are projected to carry on rising. In this way, the Department
is able to claim credit for being on course to meet the UK's Kyoto
target, even while it is presiding over the worst performing sector
of the economy in terms of trends in emissions. [78]
We are concerned that this situation will be exacerbated
with the new PSA. Although the Secretary of State for Environment,
Food and Rural Affairs is given overall responsibility for delivering
the Agreement, no Departments are given specific responsibility
for delivering emissions reductions. We
recommend that, in consultation with the Committee on Climate
Change, the Government considers setting emissions reduction targets
for specific sectors of the economy, with relevant Departments
being made accountable for achieving them.
56. We also have some concerns that environmental
issues appear to be 'ghettoised' within two PSAs, rather than
being reflected throughout the range of objectives given to Departments.
As a key example, transport has a PSA devoted to it—PSA
5, "Deliver reliable and efficient transport networks that
support economic growth"—whose delivery agreement states:
This PSA is specifically focused on the contribution
that transport makes to economic growth. Other priorities for
the Government's transport policy—in particular in relation
to the urgent need for action on climate change—are covered
separately in other PSA outcomes to which transport is a significant
contributor.[79]
The problem is that, to pursue this example, the
Department for Transport is far more likely to concentrate on
the indicators underpinning the PSA for which it is the lead Department
and clearly accountable. PSA 27 on climate change, meanwhile,
merely gives DfT's responsibility as ensuring that "transport
policies balance the increasing demand for travel against protecting
the environment".[80]
Friends of the Earth (FoE) commented on this: "we have seen
from experience that 'balancing' these demands in, for example,
the Aviation White Paper sees a strategy which allows for a greater-than-doubling
increase in carbon emissions."[81]
The Woodland Trust, meanwhile, singled out PSA 7, "Improve
the economic performance of all regions and reduce economic inequalities
between regions", for criticism: "five out of the seven
indicators in PSA 7 […] relate to economic development, and
only one deals with addressing climate change. None of the measurements
appear to protect either green infrastructure or biodiversity."[82]
The Woodland Trust also complained that there was only one indicator
of progress in protecting biodiversity in the whole of the new
PSA system, and that this could not give an adequate picture of
progress overall.[83]
57. Most importantly, in terms of reflecting the
outlook of the Treasury and its influence on Government as a whole,
Friends of the Earth criticised the Treasury for failing to embed
environmental policy in its core economic objectives, as set out
in PSA 1: "Raise the productivity of the UK economy".
As FoE put it:
It is a continuing major omission that the Government's
strategy on productivity, set out in PSA1, focuses so narrowly
on labour productivity. There are other aspects of productivity
which can help the UK's competitiveness, and also environmental
goals—resource and energy productivity. While it may have
been the case in decades past that resource inputs were a minor
element of productivity, this situation has now changed. It is
becoming increasingly important for all economies to make rapid
improvements in the efficiency with which they use resources and
energy. […] This is a major opportunity missed, for UK businesses
and the environment.[84]
We agree with Friends of the Earth: focusing on resource
productivity would help to ensure that Government policies designed
to increase economic growth would be in accordance with the principles
of sustainable development (and indeed with the UK Sustainable
Development Strategy).
58. We recommend that, in preparing
now for the next Spending Review, the Treasury work to develop
PSAs that will mainstream environmental objectives throughout
the entire range of departmental activity. Environmental objectives
must not be confined simply to a couple of explicitly environmental
PSAs. In particular, we recommend that, rather than focusing purely
on labour productivity, work starts now on developing ways of
incorporating targets for improving the efficiency with which
natural resources are used in the UK economy.
75 HM Treasury, 2004 Spending Review, http://www.hm-treasury.gov.uk/media/7/9/sr04_psa_ch13.pdf Back
76
"UK climate change sustainable development indicator",
Defra statistical press release 25/08, 31 January 2008 Back
77
Defra, UK Climate Change Programme - Annual Report to Parliament,
p 21. Progress against the Kyoto target is more encouraging, however,
with greenhouse gas emissions in 2006 down by 15% (19.5% if counting
the purchase of carbon credits), already in advance of the UK's
Kyoto target for 2008-12. Back
78
Environmental Audit Committee, Ninth Report of Session 2005-06,
Reducing Carbon Emissions from Transport, HC 981-I, para 32 Back
79
HM Treasury, "PSA Delivery Agreement 5: Deliver reliable
and efficient transport networks that support economic growth",
October 2007, p 3 Back
80
HM Treasury, "PSA Delivery Agreement 27: Lead the global
effort to avoid dangerous climate change", p 13 Back
81
Ev 10 Back
82
Ev 77 Back
83
Ev 77 Back
84
Ev 11 Back
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