Sustainable Development in a Changing Climate - International Development Committee Contents


Examination of Witnesses (Questions 223-239)

MR MICHAEL FOSTER MP, MR ELWYN GRAINGER-JONES, LORD HUNT OF KINGS HEATH AND MR ANDREW RANDALL

29 APRIL 2009

  Q223 Chairman: Can I say good morning, Ministers, to you and your advisers. For the record would you please introduce yourselves and your team?

  Mr Foster: On my left is Elwyn Grainger-Jones, who is the Head of Climate and Environment Group at DFID.

  Lord Hunt of Kings Heath: Can I introduce Mr Andrew Randall, Advisor on International Issues at Defra. May I, Chairman, just apologise that I have been asked to go a meeting of COBRA this morning at 11 o'clock and will therefore be leaving this hearing early. I will ensure that any questions that come under my responsibility we will follow up immediately.

  Q224  Chairman: Thank you for that. We have tried to re-jig the questions so that we can ask them while you are here but we quite understand, Minister. Having said that, some of our colleagues indicated they were on their way. This meeting has changed in time and I hope they will join us but the meeting is quorate which is the important thing. You will know that we decided to do this inquiry to determine the extent to which climate change was being embedded and mainstreamed within the development strategy and our predecessors carried out a pretty full report on climate change in 2002. Obviously, things have moved on quite a bit from there. At that time, DFID said its aim was to mainstream climate change into its programmes, so I wonder, Mr Foster, to what extent you have made progress in doing that in terms of country programmes. Certainly, when we go to developing countries I have to say we do not automatically get a climate change statement from DFID and I wonder whether perhaps we should. Could you explain how you feel it has been integrated?

  Mr Foster: Thank you, Chairman. One of the key measures of success for us is that we do not have a project-based approach to climate change within developing countries because we think it should be integrated into the mainstream. An example of how we do it in our normal country plans, which, of course, you and the Committee will be familiar with, is that, if we take somewhere like Bangladesh, we have a programme there called the Chars Livelihood Programme where, built into the policy to bring adaptation to the impact of flooding in Bangladesh, which is an impact of climate change, is a way in which the villagers have had the floors of their homes raised. In addition to that they are given access to a cow that is in calf, seed to grow produce for themselves and for marketing, and it is all wrapped up in one project so the people in the villages in the Chars area of Bangladesh get the benefit of having their homes protected from flooding and at the same time they have their livelihoods improved.

  Q225  Chairman: I saw that case study and obviously it was an interesting one and I can see the practical benefits of it, but the question arises, particularly the bit about raising homes, as to whether that is climate change money or poverty reduction money and how you separate them out. A point of concern you will appreciate the Committee has is that, as climate change is integrated, does it compromise poverty, reduction in terms of the allocation of funds? I appreciate they need to go together but we need to determine which is proper funding for poverty reduction and which is additional funding specifically to do with climate change.

  Mr Foster: The difficulty with this, I would suggest, Chairman, is that it is very difficult to separate out what is the benefit of the projects for the individuals concerned that is just climate related. In preventing people from being flooded we are helping improve their livelihoods and dealing at the same time with health and education issues within this particular project, and it is a way in which we think we win as a Department in literally having the two very tightly integrated. If we were to try and separate out the funding schemes for one or the other I think we would lose the benefit of the whole approach.

  Q226  Chairman: We might want to explore that a little further in other questions. You mentioned Bangladesh. In Africa, in the specific country assistance programmes, and obviously there are big climate change implications there, how do you build those into the programmes specifically in African countries?

  Mr Foster: In terms of the process that we would typically follow, Chairman, one of the approaches we have is an environmental screening process for any project over a million pounds so that you automatically consider what the impact is in terms of the environment and address the opportunities that can exist to improve the position of those that are affected, but also to identify the risks that climate change poses when we deliver a project there. Also, in terms of conversations that we have with developing countries, we look on a country-by-country basis to assess what the risks and opportunities are for particular projects. Examples of conversations that we would have would be in Nepal where there is huge potential for hydro-electricity production which can deal with the country's own need for electricity and power. About a third of the country has access to electricity so there is real need there. Only 1 % of the potential is used at the moment in terms of the waters flowing from the Himalayan region, but also it is a way in which the country can sell its energy to its neighbours, namely, India, whose energy demands are well known. It is a conversation we have with them and with our multilateral partners, like the Asian Development Bank and the World Bank, in terms of how we can get the country itself to recognise what its opportunities are to deal with climate change and also with the development benefits that can accrue from good forward-thinking policies.

  Q227  Chairman: You have set up the Climate and Environment Group as a policy and research division here in London. How is that interacting specifically in the way country programmes operate? How will it influence the climate change agenda in country programmes because the reality of the country programmes, is it not, is about seeing the follow-through?

  Mr Foster: First, on the Centre for Climate Development, we envisage the network being operational from late summer. In terms of how we anticipate the Centre is going to be used, it will be to provide knowledge, to advise developing countries on the services that are available and also to generate new priorities for research. We have had some welcome comments from developing countries about potential involvement that they want to have with the Centre. On other aspects of research, what we have also done internally is restructure our Research Department so that we have got research people sat with policy experts in the Department so that there is face-to-face contact between those who are researching on issues such as climate change and those who are dealing with policy on that. We have maintained the integrity of the research and the independence that researchers want but, rather than just exchanging communications by email, they can sit together and have discussions about how to inform policy based on the latest research.

  Q228  Richard Burden: I am getting a little confused about who is doing what. That is very helpful, what you said about creating a new Centre which is being set up this summer. However, I am not clear what its role is, how it is meant to relate to things like the Climate and Environment Group (CEG) that the Chairman mentioned, and also how that centre, as it does get under way, is going to make sure that its priorities reflect the priorities of developing countries. Perhaps you could say just a little bit more about how the bits link together.

  Mr Foster: I will ask Elwyn to come in with the detail on that.

  Mr Grainger-Jones: We see the centre as both a service to our clients and essentially a coalition of thinking organisations that we can interact with in order to improve our ability to work on climate change with our clients too. There is a knowledge management role where at the moment there is quite a wide array of specialist organisations and think-tanks thinking about certain aspects of climate change but very few that really bring it all together in organisations that span not just northern organisations but also organisations in the south. We see a knowledge management role, a role providing advisory services to developing country governments, which I think is a service that we would like to outsource. We do not have the capacity ourselves to directly provide all of that advice. We want to strengthen the international system's ability to provide advice and also to generate new priority research and analysis. We have a significantly expanding research programme. It requires a great deal of effort to scale that up adequately, so we see it providing all these services. We see it being a consortium approach linking the north and the south, and in terms of CEG's interaction, we would like to have a very close interaction with that unit. We want to have a close policy dialogue. There are many areas where the policy is still unfolding, where we need more interaction with outside organisations which can see all the links that are involved in climate change, and that is the sort of dialogue we would want with this organisation. We would not see it doing all the things that climate and environment would do. We see it as an advisory and knowledge hub, something that we would draw on.

  Q229  Richard Burden: Is it going to be independent of DFID or is it going to be part of DFID?

  Mr Grainger-Jones: It would not be a department of DFID, no. It would essentially be a contractual arrangement where we would tender for a number of organisations to come together and provide certain services. We would not be dictating the line they would take. We would not want to suffocate them and say they had to pursue certain lines. That is not what we need from this. We need challenging ideas, we need in a sense a really healthy interaction of ideas with this group of people. There would be at the centre a management oversight arrangement where ourselves and other donors would interact as providers of finance with the body to look at whether the outputs we have set out are being achieved.

  Q230  Richard Burden: So in terms of setting it up, its remit, the specs on which you are inviting tenders and so on, what involvement has anybody else had in that? Have developing countries had any input into what its remit should be and its relationship with government departments?

  Mr Foster: To give you examples of the countries which were partners in the consortium expressing an interest in the climate network, I could run through a few to give you a flavour of the interest on that—the Caribbean as a region, Brazil, Mexico, Costa Rica, Guatemala, South Africa, Nigeria, Rwanda, Senegal, Tunisia, Kenya, Ghana, Egypt, China, India, the Philippines, Sri Lanka, Fiji and Malaysia. There is a lot of country interest expressed in the consortium trying to run the whole operation.

  Q231  Hugh Bayley: Which Government Department takes the lead on international climate change policy?

  Lord Hunt of Kings Heath: Essentially, it is the responsibility of the Department of Energy and Climate Change to lead in terms of international negotiations and also to be responsible in the UK for climate change mitigation. My other department, Defra, is responsible for climate change adaptation and also sustainable development. Of course, we work very closely with DFID and Whitehall policy on international climate change is co-ordinated through the International Climate Change and Energy Programme, so there is a lot of cross-government working on this.

  Q232  Hugh Bayley: Michael, DFID is an implementation agency in developing countries for UK Government policies. What difference has DECC made to the way DFID pursues its climate change policies?

  Mr Foster: We do not see DFID's role as an implementation agent for Whitehall policy on this. We engage fully with the discussions that go on. Obviously, we are looking at the development angle in the climate change discussion. Importantly, we are feeding in the development priorities for future international agreements such as Copenhagen, and our Secretary of State has laid out some very clear development targets, if you like, that can be gained from a positive settlement in Copenhagen. That is where our responsibility lies and, of course, the Secretary of State for DFID will be present at the discussions at Copenhagen.

  Q233  Hugh Bayley: So the Department's role is to ensure that UK policy for international climate change takes proper account of the development dimension? If I could turn to Philip, does your Department have a responsibility through intergovernmental working to ensure that DFID's development policies are compatible with the Government's international climate change policies and objectives?

  Lord Hunt of Kings Heath: I am not sure that is how I would put it. As I say, the essential components of climate change internationally are DECC leading international negotiations. As far as adaptation is concerned, in the UK Defra leads on adaptation. Internationally it is DFID which leads on adaptation.[1]

  Q234  Hugh Bayley: And internationally on mitigation?

  Lord Hunt of Kings Heath: On adaptation.

  Q235  Hugh Bayley: No, internationally on mitigation in terms of outside of the negotiations. DFID will develop policy frameworks in its work with governments, particularly where it is giving programmes support for direct to a government, and that will provide opportunities, will it not, to shape or influence, or at least propose, ideas to Tanzania, shall we say, about what its mitigation policies might be as well as its adaptation policies? Tanzania is possibly not the best example because it is not such a high carbon emitter.

  Lord Hunt of Kings Heath: One has to say that in the six months that DECC has been established our key focus has been on first of all seeing the Climate Change Act through with the industry targets for the UK in the development of carbon budgets, then the 2020 agreement in Europe on 20 % GHG[2] reduction by 2020, 30 % which would be an international agreement, and then into the negotiations leading up to Copenhagen. That really has been the focus of our engagement. My colleagues in DECC have spent a considerable time visiting other countries where the focus has really been about Copenhagen and seeking to get to a successful conclusion. My experience and understanding is that when it comes to working with DFID there is a very close working relationship and I would not see it in the way you described in your first question as a monitoring role by DECC as far as DFID is concerned but as a very close working together.

  Q236  Hugh Bayley: To take a practical example, the Environmental Transformation Fund's International Window, which I understand the two Departments jointly are funding to the tune of £800 million, and it will be providing, I understand, both grants and loans to countries, how are decisions made, for instance, on whether an International Window investment should be a grant or a loan? Which department is running it?

  Mr Foster: The ETF is jointly managed by DFID, DECC and Defra. There is a government board that oversees the running of it and the Treasury and the FCO are also there as observers in terms of how this works and perhaps Elwyn could talk a little bit more about the detail of how the board operates.

  Mr Grainger-Jones: They meet approximately every two months. Those meetings are very interactive. Essentially we decide the overall strategy for how we manage these funds. We decide issues by how we would allocate funds into different types of activity and how we review progress on the Climate Investment Fund, the vehicle that we have set up to manage these funds. We decide details such as what would be our approach to certain technical issues in those funds, how we approach coal, for example, and the funds themselves are managed through a governance mechanism on the Climate Investment Fund. That is pretty innovative, where we have potentially equal representation in these international funds, and there was a lot of discussion with NGOs and others about how this was set up, and those are international discussions, not just in the UK. Essentially, the ETF governance mechanism in Whitehall is reviewing how the international process is going.

  Q237  Hugh Bayley: As for determining the UK policy, how does the UK influence the decisions that are made as to how the funds are used, whether they are, as I say, grant or loan funding streams, and how would you monitor and evaluate the outcomes which a fund contributes to?

  Mr Grainger-Jones: In terms of how we would take decisions, the board takes decisions and those are approved by our ministers in respect of departments, and are decisions on the top level strategic ambitions and objectives and on financing allocations. When it comes to the more day-to-day decisions, for example, if project or programme strategies are being reviewed, there is a secretariat which is housed in DFID which advises this ETF board on how to progress what we should be advising on. Those decisions are discussed in the board. In terms of things such as grants and loans, again, that is all discussed in the board. There are certain parameters which guide that, for example, the way in which the money has been provided to it, its capital funds that we are spending, but in terms of how they then translate into how we use the grant elements of these funds, much of which is going to the forestry area, that is again discussed at the board. In terms of monitoring and evaluation, there is quite a lot of work now going into what are the concrete achievements that we are looking to achieve through the different programmes that are being set up under the Climate Investment Fund. For example, we took part in two recent international meetings about how we would be able to say what success has been achieved on the adaptation element of these funds, how you decide what is success. You have a plan first. What sort of plan? What are the success parameters? What are the projects we are looking for? Similarly on the Clean Technology Fund, we have been looking at essentially how we would judge the progress of that. The key thing is that we are looking to use the monitoring and evaluation systems that governments have been putting in place with their multilateral partners, not always necessarily generating new and additional earnings but we do need to improve the systems in place.

  Q238  Richard Burden: Could we spend a few moments looking at MDG 7 and our performance and our impact on that? Perhaps, Mike, you could start off and let us know what impact you think the work of the UK Sustainable Development Commission has had in practice on DFID's approach to meeting MDG 7 on environmental sustainability.

  Mr Foster: As you know, Mr Burden, the MDG 7 targets in some areas are on water; they are just about on track. On others we are off track and we need to accelerate the progress that we are achieving. Where we have made some specific progress, if we look at the water resource management side, it is being delivered through in-country programmes. We have looked at ways of improving a more regional perspective to water resource management because of the impact of climate change and the variability in rainfall. It is likely to cause greater flood potential so we have invested quite heavily in that side. An example would be the South Asia Water Initiative which is looking at the flow of water from the whole Himalaya region affecting all the countries surrounding that area on the basis of the fact that it is likely to affect some three-quarters of a billion people. In terms of our own in-country work, we have been doing that as well. I mentioned the environmental screening approach that we have and some of the discussions that we have in-country. In terms of other aspects of MDG 7, biodiversity is one of those that is a difficult one to measure and there are challenges there that the international community has about how we get a proper measure that we can verify and stand up and be accountable to on issues such as valuing the loss of and challenges to biodiversity.

  Q239  Richard Burden: That is useful. We may later come back to some of the specific areas of work. What I am interested in at this stage is how DFID interacts with the Sustainable Development Commission and whether the Sustainable Development Strategy that we have across departments has impacted on DFID's work and, if so, how. If I can put it to you, some would say not very much. For example, the International Institute for Environmental Development say that DFID has not really given sufficient priority to sustainable development and they indicate that DFID only plays a minor role in the Sustainable Development Commission as the Government's advisory body. Is that fair, and if it is not fair how does DFID interact with it, and what has come out of that? What is it affecting?

  Mr Foster: Where that criticism might well be levelled is that the Sustainable Development Commission (SDC) is primarily focused on the UK and works within the UK, so we have a limited amount of engagement because our remit is the more international perspective as opposed to the SDC which is pretty much UK limited in terms of its outlook.


1   Lord Hunt meant to say that internationally it is DFID and DECC that together lead on adaptation. Back

2   Greenhouse Gas Back


 
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