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The Prime Minister: One of the things that is happening over the summer is that the Youth Parliament will sit in this Chamber while we are away-I believe that you
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have made that possible, Mr. Speaker. The Youth Citizenship Commission has reported in the last few weeks and it looked at the issue of voting at 16. I think that people want to combine any change in the voting age with citizenship education working even more effectively in our schools, and we remain ready to push forward that debate, which has been started by the Youth Citizenship Commission, and get the opinions of young people, as well as of adults.

Q6. [286662] Mr. Gregory Campbell (East Londonderry) (DUP): In recent days, we have paid tribute to our servicemen and women in Afghanistan, and my right hon. Friend indicated that earlier. Previously we did that in Iraq and, for 30 years before that, in Northern Ireland. Surely now would be an appropriate time to consider some form of permanent recognition for these courageous service personnel, who deserve the enduring gratitude of the entire nation.

The Prime Minister: I shall look at what the hon. Gentleman says, but I think that he knows that there was an announcement in one respect by Her Majesty the Queen only two weeks ago. I shall look specifically at his recommendation.

Mr. George Howarth (Knowsley, North and Sefton, East) (Lab): My right hon. Friend will be aware that this morning Jaguar Land Rover announced that it was phasing out the X-type model and that 300 jobs would be lost at the Halewood plant. Obviously, my right hon. Friend will agree that that is a severe blow to the Liverpool city region. Will he give me an assurance that the Government will do everything that they can to secure the long-term future of Jaguar Land Rover at Halewood?

The Prime Minister: Any redundancies and any loss of jobs are to be regretted. I believe that we will be able to help those people who are losing their jobs back into work. We also want to secure a future for Halewood. We have offered JLR a grant of £27 million towards the development of low-carbon Land Rovers at the plant. They would be produced there. We are trying to do what we can to replace lost jobs and I will work with my right hon. Friend, because I know that he does a great deal in this area, and with others in the region to make sure that jobs come to Halewood.

Armed Forces

Q7. [286663] Dr. Julian Lewis (New Forest, East) (Con): Whether insuring against the threat of state-versus-state warfare remains a core role of the armed forces; and if he will make a statement.

The Prime Minister: Our armed forces are fundamental to counter state-led threats. That was made clear in our national security strategy update, which we published last month.

Dr. Lewis: I am relieved to hear that. Before Iraq and Afghanistan, we were spending 2.5 per cent. of gross domestic product insuring against potential threats from
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other industrial countries. As we are still spending 2.5 per cent., despite the additional cost of the counter-insurgency campaign and including the contribution of the Treasury reserve, which of those two major military roles is currently underfunded? One of them must be.

The Prime Minister: I have to say to the hon. Gentleman that defence spending has continued to rise in real terms, in contrast to what happened in the last years of the Conservative Government. I have to say, also, that
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in addition to the defence budget we have put aside £14 billion for the campaigns in Iraq and Afghanistan. I want to tell the hon. Gentleman that our budget, in cash terms, is still the second largest in the world.

Greg Mulholland (Leeds, North-West) (LD): On a point of order, Mr. Speaker-

Mr. Speaker: Order. I say to the hon. Gentleman that, as he will know, points of order come after statements.

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UK Low Carbon Transition Plan

12.32 pm

The Secretary of State for Energy and Climate Change (Edward Miliband): With permission, Mr. Speaker, I should like to make a statement about the UK low carbon transition plan, which we are publishing today.

All of us in this House know the gravity of the challenge that climate change poses. We know that to rise to the challenge will mean comprehensive changes in our economy and our society. We are one of the few countries in the world to exceed our Kyoto targets, we are now the leader for offshore wind generation and we are the first country in the world to legislate for carbon budgets, but the proposals published today represent the first time that we have a set out a comprehensive plan for carbon across every sector-energy, homes, transport, agriculture and business.

A decade ago, the carbon impact of most policies was not even measured. Last year this House passed legislation for legally binding carbon budgets-measurable caps on our carbon emissions. That was a dramatic change in approach, but we need to go further because every part of Government needs to be responsible for meeting those budgets. So I can announce that from today not just the country as a whole, and not just the biggest Departments, but every Department has its own carbon budget. Having been the first country in the world to set legally binding carbon budgets, we are now the first country in the world to assign every Department a carbon budget alongside its financial budget.

The plan sets out how we will meet the carbon budgets set out by the Chancellor for an 18 per cent. reduction on today's levels by 2020, or a 34 per cent. reduction compared with 1990. Let me announce to the House how we will make the 459 million tonnes of carbon savings. In agriculture and waste, there will be a 6 per cent. cut in emissions-20 million tonnes-by 2020, made possible by new policies on waste and new commitments on farming.

In the transport sector there will be savings of 14 per cent., or 85 million tonnes, by 2020, as is set out in the sustainable transport strategy published today by my right hon. and noble Friend the Secretary of State for Transport. This includes plans for electrification of rail, tougher car and van emission standards, and the new £30 million fund to get low-carbon buses on the roads in the next two years. We are also doing more to bring about the transition to electric cars, with new funding making possible a recharging infrastructure in up to six cities.

Across business and the workplace, we show how we can make 41 million tonnes of savings, or 13 per cent. on today's emissions, including through the carbon reduction commitment to be introduced next year.

The most important reductions to meet our carbon budgets will be in how we generate and use energy. In the power and heavy industry sector, we show how emissions will be reduced by 22 per cent., or 248 million tonnes. With North sea gas production declining, if we carried on with business as usual, over the next decade our imports of gas would double. On the basis of the low carbon choices I announced today, our forecast is that rather than our gas imports doubling, they will be
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kept to 2010 levels for the whole of the following decade, so that with more low-carbon, home-grown energy, we avoid an ever-increasing dependence on imports.

I have listened to representations on renewable energy and have concluded that, for reasons of energy security and climate change, it is right to go ahead with plans for 15 per cent. domestic renewable energy by 2020. In the final decisions in the Government's renewable energy strategy, published today, we show how we can secure about 30 per cent. of our electricity from wind, marine and other renewable sources. We are also publishing the shortlist of Severn tidal schemes.

I believe it is right that we shall also go ahead with our plans for new nuclear power stations. We will publish our national policy statements on nuclear and other energy issues in the autumn, and the industry is planning at least 12.4 GW of new stations-more than current capacity. Alongside the most environmentally stringent coal conditions in the world, the Government have proposed up to four carbon capture and storage projects, and we have proposed legislation for the next Session of Parliament to make that happen.

Let me be clear: I believe that for the future of energy in Britain, clean coal has an essential role to play. As the plan sets out, renewables, nuclear and clean fossil fuels are the trinity of low carbon and the future of energy in Britain. It would be fatal to pick and choose between them; all of them should be part of our future energy mix. In total, our plans show that we will get 40 per cent. of our electricity from low-carbon energy by 2020 and more in the years that follow.

To deliver the changes in our energy supplies between now and 2020, we must make it easier for investors to turn low-carbon projects into reality. Having tackled the planning rules, I believe we now need to do more to deal with the issue of grid connection, so I am today announcing that I will exercise the reserve powers provided under the Energy Act 2008 for Government, rather than the regulator, to set the grid access regime. The new rules should be in place within 12 months, so that instead of waiting for more than a decade for grid connection, as can happen now, we can get the fast access to the grid that renewable projects need.

We also know that as we generate power in a cleaner way, we also need to use energy in a smarter way in our homes. In the plan we show how, in total, cleaner sources of heat and better use of energy can cut emissions from our homes by one quarter compared with today. We must also transform the information on energy use available to all of us, so as well as putting in place new funding today for smart grids, we propose to roll out smart meters to 26 million homes by 2020.

We need new incentives as well as better information. The plan makes it clear that in energy efficiency, we need a house-by-house, street-by-street transformation, like the transition from town gas to North sea gas in the 1970s. Over the next decade, our plan sees families not having to pay up front, but being able to spread the costs over many years, paid for out of the savings on their energy bills. Today we take the first steps with the first pilots of the new pay-as-you-save scheme.

As well as information for individuals and the right incentives, we know from the transition towns movement about the power of community action to motivate people, so we will provide £500,000 each to 15 areas of
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the country for people to come together to trial the newest technologies and be beacons for how other communities can cut their carbon emissions. In addition, I can confirm that from next April, individuals and communities alike will be able for the first time to generate their own renewable power and sell it back to the grid, with guaranteed feed-in tariffs. The details of the rates and levels on which we are consulting are set out today.

We need reforms not only in how we produce energy and how we use it, but in how it is regulated. In the energy world of today, unlike that of 20 years ago, the job of the regulator is to help to deliver on our climate change commitments, because failure to act now will store up greater costs later. I therefore propose to change Ofgem's principal objective so that for the first time, reducing carbon emissions, as part of protecting the future consumer, will be explicitly set out as part of its guiding mission. Competition is essential, but we know from the experience of prepayment meters that it has not delivered for all consumers, so I will also make it clearer in Ofgem's principal objective that when competition does not deliver, it is its duty proactively to stand up for consumers throughout this country.

With greater expectations of the regulator should come greater powers, so I also propose to legislate to provide Ofgem with tough new powers to take action where it believes that there is anti-competitive practice in the generation of electricity. Strong regulation is all the more important given the upward pressures on prices in the coming years. Making the energy transition will have costs, but for households those costs are significantly offset by savings resulting from energy efficiency and reduced energy demand. Today's plan will not increase average household energy bills by 2015, compared with now. For households in 2020, the plans today will mean, on average, 6 per cent. on domestic bills-£75 a year-compared with today. If we include all previous policy announcements on climate change, the figure is 8 per cent.

Given the costs of transition and the priority of tackling fuel poverty, we need to do more to protect the most vulnerable consumers, so I propose to reform the system of social tariffs, as has long been urged. More than 800,000 households now receive discounts and other help with their energy bills. That is part of a voluntary agreement with the energy companies. I propose that when the voluntary agreement ends in 2011, discounts for the most vulnerable will continue not through a voluntary arrangement but through legislation for compulsory support from the energy companies. We will legislate to increase the amount spent, and we intend to target new resources at the most vulnerable consumers, particularly older, poorer pensioners. We must make the transition to low carbon on the basis of energy security and fairness, and we must also seize the industrial opportunities, using the money that the Chancellor allocated in the Budget. We have set out plans for carbon capture and storage and, today, for new investment in nuclear manufacturing.

As for renewables, Britain has half the usable tidal energy in Europe. Today I am committing up to £60 million to build our wave and tidal industries so that we can test new technologies and expand port access and deployment in key parts of the country. We also need to nurture the offshore wind industry, in which we have a unique
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resource, so I am making available up to £120 million to support the growth of a world-leading offshore wind industry in Britain. As well as supporting the demonstration and testing of offshore wind, the money will be used to attract offshore wind manufacturers to the UK. We estimate that those investments will help to nurture industries that can support hundreds of thousands of jobs in our country. We can make that investment today only because, even in the tough times, we made the choice to invest in the economy of the future.

Climate change is the moral issue of our time. In five months' time, the world must come together at Copenhagen and follow through on last week's commitment by world leaders to stop dangerous climate change. Today we show how Britain will play its part. Our transition plan is a route map to 2020. It strengthens our energy security, it seeks to ensure that the decisions we make are fair, and above all, it rises to the moral challenge of climate change. This is a transition plan for Britain, and I commend it to the House.

Greg Clark (Tunbridge Wells) (Con): I begin by thanking the Secretary of State for advance sight of his statement. After the briefings in the weekend press, which were even further in advance, he has been generous in informing us all about the content of today's policy announcements. Like the Secretary of State, I read all the best bits months ago in the Conservative Green Paper "The Low Carbon Economy", which, I am reliably informed, has lingered on his desk. That being the case, of course I welcome his remarks. This area of policy is crucial for Britain. Its consequences will affect our lives and those of future generations. Investments worth billions of pounds need to be made in a very short period. There is plenty of risk in that-risks inherent in the capital markets, in future energy prices, and in the technologies. However, for too long, public policy in this country has been a source of additional risk for investors. I am determined that instead of amplifying uncertainty, our policy, with its clarity, rigour and consistency, should be a haven from it. That means that on this issue we should not pursue narrow short-term partisanship; instead, the long-term interests of the country must come first.

If we are to have a fresh start, will the Secretary of State be candid in accepting that we start from a poor position? In 12 years there have been 15 Energy Ministers, but no energy policy. Does he recognise that while other countries have spent the past decade diversifying their supplies of energy, Britain has become even more dependent on imported fossil fuels? He talks about preventing that from happening in future, but I have news for him: it has already happened, and is threatening our energy security, economic competitiveness and climate change objectives.

Britain has some of the best natural resources in the world, so will the Minister explain why no other European country, apart from Malta and Luxembourg, generates less energy from renewables than we do? Does he accept that we have the least efficient homes of any major European country, and that one consequence of that is soaring fuel poverty? Social tariffs are of course important, but we must recognise that they are a sticking plaster rather than a cure for the problem.

Does the Secretary of State recognise that he is presenting Britain's consumers with the bill for this decade of dereliction of duty? Everyone one knows that
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doing things in a last-minute rush means that one always pays more than if one had planned and acted ahead of time.

While we welcome the intention of the proposals, we will judge them against the rigour, ambition and urgency of the proposals in our paper on the low-carbon economy. Will the Secretary of State therefore confirm that the home energy efficiency scheme will be available to every household in the country, not just to a few pilot areas? With the roll-our of smart meters already under way in America and elsewhere, why will he not set an earlier target than 2020? Does he accept that, by any logic, the required carbon capture from a power plant must be proportional to its size, and that that could best be achieved by an emissions performance standard?

Will the right hon. Gentleman scotch the rumour that he plans for just 2 per cent. of Britain's energy to be generated under the feed-in tariffs by 2020? Above all, is he committed to the radical change required by the 2050 target, or will he dilute the low-carbon economy with imported offsets that would rob Britain of moral and industrial leadership, and developing countries of the easy wins that they need to achieve their own targets?

Last week, the Secretary of State's brother, the Foreign Secretary, said:

The Secretary of State stands in a position of great moment. He must decide whether he will break with the past and implement rigorously the measures that both he and I know need to be taken, or whether the next six months, like the last 12 years, will prove to have been a time of opportunity lost.

Edward Miliband: Let me start by saying that I welcome the hon. Gentleman's opening remark that we should conduct the debate in as bipartisan a way as possible. I therefore regret the tone of his subsequent remarks, and I advise him that it does not make much sense for him to come to the House and say that he wants bipartisanship and then engage in attacks that are pretty much without substance.

I shall deal first with a point that the hon. Gentleman made that I consider to be very important for people watching in the country. He would have us believe that the reason why we will pay a higher price for the switch to renewable energy is something to do with what has happened in the past few years. He knows that that is not the case, and that the transition will have costs. I advise him in all seriousness that as we conduct this debate, we need to level with people about that. I have been very open about saying to people, "Look, there are costs to the transition." We will never persuade people to make the transition if we say that the costs are a result of Government inaction in the past: they are not, and the hon. Gentleman knows that, just as he knows that there are costs to the transition.

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