CORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 113-iii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

ENVIRONMENTAL AUDIT COMMITTEE

ADAPTING TO CLIMATE CHANGE

Tuesday 5 January 2010

MS ISABEL DEDRING and MR ALEX NICKSON

Evidence heard in Public Questions 132 - 159

USE OF THE TRANSCRIPT

This is a corrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee, and copies have been made available by the Vote Office for the use of Members and others.

The transcript is an approved formal record of these proceedings. It will be printed in due course.

Oral Evidence

Taken before the Environmental Audit Committee

on Tuesday 5 January 2010

Members present

Mr Tim Yeo, in the Chair

Mark Lazarowicz

Jo Swinson

Dr Desmond Turner

________________

Memorandum submitted by Greater London Authority

Examination of Witnesses

Witnesses: Ms Isabel Dedring, Mayoral Adviser on the Environment, and Mr Alex Nickson, Climate Change Manager (Adaptation), Greater London Authority, gave evidence.

Q132 Chairman: Good afternoon and welcome to the Committee. Sorry we are a few minutes late in starting. We are slightly short today because this meeting clashes with a statement in the chamber by Ed Miliband and some of our colleagues are there. At least one of them, I think, will join us during the course of the evidence. Isabel, it is a bit of a marathon session for you. I do not think we have ever had the same witness dealing with two completely different inquiries, but I think it is convenient from your point of view and it is quite convenient from ours because these are successive subjects that we are dealing with.

Ms Dedring: I just wanted to say thank you very much for having us consecutively because I know that is unusual.

Q133 Chairman: It is, but it is fine. Thank you for coming in. I do not know if you want to make any opening statement or shall I just crack on with some questions?

Ms Dedring: Yes, that sounds good.

Q134 Chairman: We are dealing with adaptation first because we are towards the end of our evidence taking on that. We are not quite at the end of it, we have got Hilary Benn coming in later in the month, but we are towards the end of it. Do you want to say how big an impact you think climate change is going to have on the way Londoners live and how soon that impact will be felt?

Ms Dedring: You will have seen the UK Climate Projections that recently came out and those numbers for London are not completely out of line with what we thought previously. They have been revised slightly, but directionally they are the same. It is quite a significant impact in terms of averages often obscure some of the variation around an average. I guess our general view is that impact, which we already knew was going to be significant, unfortunately will be very significant unless we start to move out of the analytical phase and into a delivery phase. For example, in 2050 80% of the buildings that are here today are going to be here still in 2050, so having eco-build for new buildings is important but retrofitting London's existing building stock is very important as well. Our general view is that we are trying to shift into a phase of continuing to understand things better, but at the same time moving towards a delivery of programmes like large-scale rollout of water efficiency measures, trying to prevent overheating and adapting to drought, again on the ground rather than simply analysing what the impacts are going to be for London overall.

Q135 Chairman: I would like to come back to buildings in a bit more detail in a moment. Just looking at it from a business point of view, it is quite topical to see how London is going to fare business-wise in light of the recession and possible tax changes and so on. What do you think the implications and the opportunities, indeed, from climate change are for businesses in London?

Ms Dedring: The big emphasis for me is London is possibly the financial services centre in the world and certainly a major financial services centre. The discussion on the adaptation front has not moved on as far as it has on the mitigation front on the financing of these measures. If you wanted to talk about delivering a sort of future-proofed London, the cost of doing that is not going to be borne by government grant alone. There is no way that there is a sufficient volume of grant funding, particularly not in the current environment, so the challenge for all of us is to think about how we actually pay for the kinds of measures that need to be put in place. In many cases there is already an underlying, in theory, economic incentive for people to do this because if you have a building or operations that are more robust and more climate-proof then in principle your insurance should come down, your risks should come down, but you are not seeing the level of retrofit activity, of adaptation activity, that you should be seeing based on that economic theory. Clearly there is something going wrong in the theory when you actually translate it into reality. The big opportunity for London is in the financing sphere, much like the CO₂ front where, again, I do not think we are anywhere near where we need to be, but there is a fundamental issue about how through some combination of public and private funding streams we actually deliver implementation of these things at the scale they need to be implemented on the ground and we are just not even remotely in the territory of where we need to be at the moment. The 2080s sound like they are far away, but when you are talking about three million homes in London and millions of square feet of office space then the 2080s are actually quite close. I think London could be unique on that because it is a fantastic opportunity for us if we can demonstrate ways of approaching this. It is something we have looked at through the London Climate Change Partnership a little bit. There is no creative financial thinking around that at the moment, but we have been trying to say that it is a great opportunity right now for the banks because they are arguing they have got quite a lot of money, they are interested in these new approaches, but we need them to be putting their thinking caps on to come up with ways to actually finance the scale of activity that is needed.

Q136 Chairman: Is adaptation something which is now affecting political decisions generally in London?

Ms Dedring: I would not say it is in the tokenism category, but it is not mainstreamed in the way that it needs to be. There is not that level of funding that is needed. For example, and Alex can talk a little bit more about this, we are doing this Drain London Project and it is Ł3.2 million worth of funding from Defra which is both to understand better the flooding problem in London both now and in the future and also to look at how we can more effectively respond to that problem. Within that, we are not just doing analysis, we are trying to demonstrate things like how do you get uptake of green roofs on existing buildings to reduce surface water flooding, how do you get communities to take ownership of the flooding issue rather than just thinking, "Right, I've got my house and periodically it floods, there is not much I can do about it", whereas if you look at a localised area that is subject to flooding risk then you could actually say every home is going to have a water butt, permeable surfaces in the front yard and the cumulative effect of that would be to minimise the flooding issue in that area. Those kinds of approaches need to be rolled-out much more broadly and at the moment these are just small pilots. We have enough funding and within the three million only a chunk of that is for these actual pilots. We are doing two pilots of community approaches, but that is the kind of thing one could imagine rolling out more broadly. At that level there is not that kind of machinery in terms of rollout. That is fine because it has been a period of people understanding the issue and getting to grips with the scale of the issue, but our view is that now moving forward we need to really think about how we move into the next phase where mitigation is a few years further ahead but not where it needs to be.

Q137 Chairman: Looking at buildings generally which could be offered to either owners or tenants of all types of buildings for taking adaptation measures, for example could we have variable rates of council tax or business rates so that there was a direct financial reward for people who took adaptation measures?

Ms Dedring: I guess implicitly they exist in certain aspects in terms of your insurance premium but, again, I do not think that is translating into decision-making on the ground and, unfortunately, economic theory does not prove to be true in reality. For example, on the mitigation side, which we are also using to deliver adaptation, we have got a London-wide home retrofit programme that we are rolling out and as part of that we are looking at energy efficiency measures but also water efficiency. The scale of funding that would be needed and the delivery structures to roll that out, as I said three million homes in London, we need to be doing not 10,000 homes a year but 100,000, 200,000 homes a year, that is simply not there. For all of those homes the economic incentive to take action exists now for every home in London. The vast majority of the things that you can do save you money on the mitigation side, it is a much more straightforward economic argument, but there is not that action happening. In adaptation one would expect it will be quite a lot more difficult because that direct financial incentive, "Put in loft insulation, save on your energy bill", does not exist, so if it is difficult on the mitigation side it will be a lot more difficult on the adaptation side to let the existing incentives somehow percolate to the top. If we do want to see that kind of scale of change we need to put something else in place that is going to deliver that. Having said that, I would say our experience from the homes programme is that a lot of it is about the hassle factor, it is not about an economic argument. What we do with the homes programme is literally, "Stand aside, we will come in and do it all for you. You don't need to even take out a single light bulb, we'll put in the light bulb, you don't have to go to the store and buy anything". That does make a big difference in the take-up of those measures in those homes. It is not that people mind paying for it in many cases, it is simply, "Oh, I forgot to get the light bulb at B&Q this morning, I'll get it next month". A lot of those same issues are playing out on the adaptation side as well, it is simply not a priority for people even though on the basic math there is an argument for doing it.

Q138 Chairman: Given the scale of the problem, and you talked about three million homes and the urgency of stepping up the rate at which this is being addressed, are there extra policy levers you need? What can be done? I entirely understand what you said about the difficulty of if we cannot even persuade people to take mitigation measures which are often very directly in their own financial interests then how are we going to get them to do adaptation measures, but is there any policy lever that would be good for you or perhaps for central Government to have?

Ms Dedring: Two things spring to mind, and again new build is a bit easier because there are already good standards that are rolling out and it is really more about the big bulk of things that do not relate to new buildings. One is that certainly on the water efficiency side in our discussions with the Regulator and with the major water companies in London, they are all engaged in water efficiency at some scale but not at any kind of scale that one would want to see. It seems to be both a regulatory issue, that the regulatory algorithm does not sufficiently incentivise investment in water efficiency, and there is seen to be a risk associated with it, which is, "I'm going to put all this stuff in and then maybe people are going to use more water than they did before because they will just offset the savings by letting the shower run longer". There is a behavioural uncertainty around that and then the water companies, therefore, do not take any major steps in that direction. We have had several discussions with Thames Water around the homes programme saying, "This is a great vehicle for you to roll out water efficiency measures" and they are interested, but it is not like they are biting our arm off, put it that way. I think that would be one specific policy intervention that we are certainly going to be speaking to Ofwat about. It is about how can we get water efficiency raised up the priority scale. If you look on the energy efficiency side, CERT[1] is not an adequate tool for delivering energy efficiency but at least it exists and there is no CERT equivalent on the adaptation side. It is a bit of a blunt tool, it is just a funding pot, but there is not such a thing on the adaptation side. Again, that is difficult. If you look at some other cities, things like green roofs, for example, a lot of other cities have removed the municipal storm water management charge and that has been an incentive that has worked quite well elsewhere, but we do not have anything like that. Here one could imagine having payment for storm water management which is then reduced or eliminated if you put the appropriate measures in place. It has been very effective in cities like Chicago and there is no reason to think that we could not do that here. Arguably it is fairer because you are paying for the amount of water that you discharge from your premises. I do not know whether there is anything else, Alex, on specific policy measures that might be worth mentioning?

Mr Nickson: I would just reiterate that I think we do have some problems in the fact that water is too cheap and drainage is something we do not particularly want to talk about until it is in our front room and then we just want it gone, and the fact that there is no real driver for people to adapt, there is no immediate financial incentive. As we have seen from all too frequent flood incidences, even when people are flooded they are selectively oblivious to the fact that it might happen to them again and take some false comfort in the fact that a once in a 100 year event having now happened they are good for another 99 years. Even when we look at Carlisle, the number of people who signed up to the EA Flood Warning Direct, which is a free service providing warning, that barely rose after the flood event even though no major flood defences had been installed and nothing had really changed. People are particularly obdurate with regard to wanting to accept the risk that they face. As you eloquently put, if on mitigation where they are going to save money immediately we cannot persuade them then it is a really tough sell on adaptation. Some of the levers we could investigate are things like water companies, as Isabel said, being required to push water efficiency rather than sell water as cheaply as possible. We need to look at the insurance industry being a key player in helping us adapt because at the moment it is not really in their interest, the premiums do not differentiate against the risk. Also, when you are flooded or have to make a claim you get a like-for-like replacement and basically reinstate exactly what was affected last time rather than adding to some cumulative resilience measures. I think the insurance industry themselves need to start to have this discussion about when we are tied to an annual premium how they can encourage resilience measures as an industry so they collectively win rather than pricing it differently.

Q139 Jo Swinson: You have made a very good case for not just looking at it in silos of energy efficiency or water efficiency but doing it together and, good news as it sounds, the London-wide programme is more integrated in that sense although I am not sure if it involves resilience as well as water and energy efficiency. What do you think the barriers are to addressing this in that kind of integrated way?

Ms Dedring: At all levels of government these issues are handled by different departments. It is just an organisational culture issue, is it not, so they are not used to working together and, therefore, with the funding streams attached to that. Not to come on to air quality but we have got that issue there too where you have got the DfT dealing with issues around transport emissions and Defra talking to each other but it is not really a single integrated whole in that same way, and I am sure the same accusation can be made of the GLA. I think at an institutional level that is the biggest barrier I can see. Trying to go into somebody's home every three months to do something else is not realistic. We might succeed in getting them from level 23 on their priority list to 21, but you are never going to make these issues number one for the vast majority of the population. I wish they were, and I wish everybody thought what I think, but unfortunately all market research shows on green issues that, quite interestingly, you always have the 20% who are quite passionate and want to do something, 60% do not really care unless it is super easy and 20% who are going to drive their SUVs just to annoy you, kind of thing. The issue is how we get at that 60%. For me, speaking a language of encouragement is not going to work, it literally has to be so easy and that means bolting as much together as possible. The homes programme already includes things like smoke alarms and benefits checks because that is a way to incentivise the local authorities to participate and it is a cheaper way of delivering those kinds of things to deliver them once. We would love to bolt other things onto that as well on the adaptation side because it is not comprehensive on that front. Again, there is a lack of funding and lack of partners. At least with the energy stuff you can talk to the energy companies-good luck, but at least they are there-but on the adaptation side there is not really that same obvious set of interlocutors to speak to.

Q140 Jo Swinson: Just following on from that, what do you think Government needs to do? Does Government accept that doing it in that kind of integrated way is the best way forward and, if so, what should they be doing that they are not to make that easier for you to implement?

Mr Nickson: I think the first thing is making sure that wherever they are pushing energy efficiency they are pushing water efficiency too because at the moment the CERT and the HESP,[2] replacement of CERT, currently only focus on energy efficiency. We have things like Energy Performance Certificates which do not consider water as well, but when you say we take the average home and 27% of the carbon produced in the home comes from heating water for washing and cleaning, if you can be water efficient you can be energy efficient and, therefore, you can be drought resilient and double the saving. A systemic change across all the government programmes to make sure that the water message and the energy message are perfectly aligned would be a very big help. I also think that potentially a reduction in VAT, if not a complete removal of VAT, on adaptation measures would make an enormous step forward. At the moment that would help to reduce some of the cost barriers that we perceive. That would be an enormous start.

Q141 Jo Swinson: In terms of funding options do you think it would be best to proceed with CERT as it is but to have something additional created for water efficiency or other adaptation measures, or do you think that CERT should be amended, expanded or scrapped and a new scheme put in place that deals with all of them?

Ms Dedring: I think the important thing is that the consumer does not want to know all about that stuff. They want to know somebody is going to show up, this is all going to happen and there might be some massively complex thing behind it. Obviously we would like to completely scrap everything and design a perfect solution but that is probably not realistic just accepting that there should be a single frontline delivery structure, if at all possible, even if that is coordinated at the local authority level. The reality of life is that it is probably not realistic to expect a successor to CERT to be merged with five other funding streams or, indeed, 30 other funding streams. Just on the energy efficiency side there are more than 30 funding streams in London alone. What we are trying to do is cobble them altogether, but behind the scenes because trying to get the right answer seems to be very difficult just because of the inertia of life. At a minimum there should be some kind of recognition that these things should be delivered jointly, but there is no forcing mechanism for that to happen at the moment. I do think to the extent that some of this is delivered in partnership with or through the local authorities, if you look at the National Indicators on adaptation they are much weaker than they are in mitigation, so the NI targets around CO₂ are about reducing your carbon and you sign up to an actual percentage reduction in carbon either on your own estate or for the territory of the borough, and when you look at adaptation it is more about having an adaptation strategy. If we could change the National Indicators for the local authorities to be much more outcome based, certainly we have seen on the energy side a lot more engagement from the local authorities. They sign up to 12% and then say, "How are we going to get there?" We have had a lot more engagement on the homes programme, for example, as a result of that. That might be quite a useful way of moving. Where they are at the moment is appropriate for five years ago maybe, and that is fine, it is just that the issue is now moving on quite quickly so one would want to move to a more outcome-based metric. I do not know whether that is percentage of buildings that have been adapted or retrofitted, however one might want to define it, but moving towards a more outcome-based metric.

Mr Nickson: The Pitt Review went a long way in trying to reduce the separation between spatial planning and emergency planning, but we still have a fundamental capacity lack in London and, therefore, I am presuming nationwide in getting spatial planners and emergency planners to work together. When you look at things like the civil contingency it is always about what is the priority in the next five years rather than what contributes towards a priority that is going to exist for the next 30 years. We do have this problem that needs to be tackled there and a lot of that is awareness-raising capacity. Isabel referred to the Drain London Programme where we are going to try to bring together groupings of boroughs that face a shared flood risk and make sure we have got a mix of emergency planners, spatial planners, building control experts, so we can start to look at how to manage flood risk across a flood zone so there are shared solutions. That expertise may come from several different boroughs but it builds the capacity towards a single approach rather than the fragmented individual approach that we saw, say, through strategic flood risk assessments where you had individual local authorities working on their own and quite often the solution was to get rid of the water as quickly as possible and pass it downstream to your neighbour. We really want to learn the lesson and ensure that in London we use this capacity building. Support from Government on that through Drain London has been great and I think we will be able to pilot that system to be able to look at how to roll it out much wider. The other thing is any communications just to raise public awareness. As I said, people are very selectively oblivious on a lot of the climate impacts they face. One of the things we are doing on the consultation of the adaptation strategy we are going to be launching shortly is we are building a bespoke website that is going to ask Londoners what they as individuals and communities can do. It is not about, "You the Mayor, you the Government need to do this", it is trying to say, "You live at a certain risk and a lot of that risk is caused by your lack of awareness and your lack of capacity to act. What is it you think you can do as an individual or a community?" and be able to monitor that and understand what it is we can do to actually help Londoners. I think that is going to be a very powerful tool because, for once, it is going to take the responsibility to act off Government and put a certain element of it back on to the public. We all remember those pictures from Carlisle of the guy saying, "I've rung my local authority 15 times for some sandbags and they are still not here to come and do anything". We need to enable people to know what to do to help themselves and, importantly, to pull together as a community to help each other. So someone will go and help Mrs Miggins next door as well as helping themselves rather than sitting around waiting for the emergency services who really need to be tending to the most vulnerable.

Q142 Chairman: That suggests clearly there is an important role for the local authority in raising public awareness about what they should and could do, but is there also a role for central Government in raising public awareness?

Mr Nickson: Yes. I am not sure exactly how. There have been a lot of Government adverts recently about eating healthier, stopping smoking, but you cannot scare people into being slim, green and healthy. A lot of money has been put into that. As I said earlier, adaptation is a tough sell but we do need central Government on this. The Mayor in many ways is a very good voice for Londoners because of his independence. We have been talking to the water companies about the Mayor being a voice about water efficiency, particularly during drought times, because no-one is going to respond to Thames Water telling them to be water efficient when they know they are losing 600 million litres of water a day from their leaky pipes, whereas a message coming from the Mayor may be much better received. We are starting to work out what are those communication channels, who are the voices and the agents that can actually provoke this change.

Ms Dedring: There is a fundamental issue across all green communications of "stop this" or "don't do that". I was talking to Eddie Hyams the other day, the Chair of the EST,[3] and he was saying "low-carbon, micro-renewables". It is all deeply unaspirational and, whatever you might think of it, does not fit with the quite consumerist society that we live in today. We find that loft insulation might be ten times more effective than having a solar panel on your panel or a wind turbine in particular locations but that is not what people want because they want the eco-bling factor. I do not think any of that has been brought to bear on the adaptation side of things. A lot of the things that you can do to make your home more adapted are nice, attractive, make the comfort of the home increase. One thing we found in the homes programme was draught proofing has quite a poor payback but people love it because it makes their home more comfortable because they could feel the draught coming through. You need to accept those are the kinds of things that motivate people, not the, "This has a 2.5 year payback" or "This is the best way to battle flood risk", just focusing people on things they can do that they would want to do for other reasons, almost irrespective of adaptation, things like green roofs. People love green roofs so that is a lot easier to sell to people than even something like a water butt which is going to take up space, is plastic and looks ugly, just starting with those messages that are more positive for people. There has been no connection, as Alex was saying, between, "It's flooded here and here's something you can actually do about it". People do not make that link at all as far as we can see. That is the kind of connection that people can make, but in the absence of anything to point people towards it is quite difficult to try and do that because what is Government saying at any level but "Go out and buy a water butt", and that does not really work. I think the tone of the communications needs to change quite significantly.

Q143 Dr Turner: The GLA is quite unique amongst local authorities in actually having a statutory duty to address climate change. You have not had this statutory duty for all that long, how much difference has it made towards the work on adaptation and addressing climate change risks in London?

Ms Dedring: A personal view almost is it does not have any real practical implication but has a big impact almost internally in convincing other parts of the bureaucracy who think that they do not need to worry about environmental issues, "That's something the environment team worries about over there", and it makes people take the issue more seriously. Whilst it is quite symbolic perhaps, or semantic, it has made a big difference and anything like that can help. The more that those kinds of pressures can be made outcome-based, as I was saying about the National Indicators earlier-we are not subject to that regime because we are not a typical local authority-all those things are useful and moving in the right direction. Having said that, as I said earlier, it is not something that is considered in the mainstream of decision-making at the level that it needs to be. It is improving all the time but it is not where it needs to be. There is a lack of joined-up thinking still.

Q144 Dr Turner: It has not made a quantum difference then?

Ms Dedring: I think that is a fair statement. It has made an incremental improvement over time, but it is still hard work. All the work that is going on in the urban realm and green space and making the case for some of those things and for more funding internally to be routed in that direction is not just about "trees are nice", but "this is actually going to improve the resilience of London" and that case is not really made internally even to the point of when you look at the business cases they will not necessarily even be aware that is a value that could be assigned to this. I used to work at TfL and the way they valued the impact on the environment-it sounds quite parochial but it is an important point because this is how these bureaucracies work-was that there was a box in the business case that said, "If you want to say anything on environment, say it here", but it was not quantified as part of the economic analysis. That has now changed, but that is not untypical for a lot of bureaucracies.

Q145 Dr Turner: Has it created a new cost burden on the Authority? In Private Members' Bills in the past I have tried to impose statutory duties with respect to the environment on local authorities and Government has been terrified of creating cost burdens. Has this actually created a cost burden for the GLA or perhaps even relieved some cost burdens?

Ms Dedring: Looking at it over time it relieves cost burdens but it is very hard to get decision-makers at any level to see this. It is the "invest to save" argument which is very difficult. The way that we do budgeting it is very difficult for people to find. There is not a line item that says, "Ł100 to invest to save Ł30 a year forever" or "To reduce my risk of X happening by Y", which if you quantify that totally justifies the Ł100 investment. Just the way the budgeting processes work, it is, "I haven't got Ł100 today", which is why some of these financing issues are so crucial. Obviously we would not do things on the environment front that made absolutely no sense at an economic level because they probably would not make sense at an environmental level either. These are all things that are good because they are reducing your risk, improving the quality of life or whatever it is. It is very easy to make a case for most of these things; the problem is more the distribution of the cash flows effectively. That is still an issue and it is very difficult to extract those line items out, which is the green investment bank where people have talked about public-private vehicles for funding these kinds of things and there was a recent announcement around Partnerships UK, I think.

Q146 Dr Turner: It is kind of aspirational window dressing then. Do you think it is worth extending the statutory duty towards all local authorities?

Ms Dedring: I do not think it can hurt. If people think that is going to be the solution to all the world's problems that is not going to work. We are quite far away from where we need to be. In our experience, in a lot of fields the more we can start to create programmes that deliver on the ground the better, and those kinds of duties do not really create sufficient pressure to trigger the creation of, say, the homes programme, for example.

Q147 Dr Turner: What about the monitoring of compliance with your duty? Does the Audit Commission rate you on your discharge of this duty?

Ms Dedring: I do not know the answer to that. Do you know?

Mr Nickson: No. Adaptation is notoriously difficult to measure. There is no nice, easy metric like tonnes of CO₂ or gigawatt hours of energy saved, which is why many of the Government measures of adaptation have resorted to being process-based rather than outcome-based. We do not actually have a measurement of how we are achieving it. I think this is going to be one of the interesting things that is going to come out of the reporting power, how we are going to be monitored on our level of adaptation over every five years based on that process. This is one of the things I have really struggled with in developing the adaptation strategy, to find a nice, solid metric that demonstrates how we are adapting well to climate change rather than the fact that we just have not had any extreme weather over that period to have caused any impacts which tends to be how most people like to measure, the number of houses flooded and so on. No, there is no easy measure there. That is something we are trying to set for ourselves as a way that we can benchmark today and then measure our adaptation going forward, but it is a very complex issue.

Q148 Dr Turner: What mechanisms do you have to ensure that climate change and adaptation is taken into account in business as usual activities and new projects?

Mr Nickson: It is part of the decision-making framework we have at the GLA. There is the inevitable tick-box exercise of "Have you considered sustainable development, equalities and climate change issues?" The London Development Agency has it as part of their gateway funding process where you have to demonstrate it. Transport for London have written it into their procurement codes where new assets being procured need to demonstrate how they have considered the future environment and so on. That is the start we have made so far.

Q149 Dr Turner: Are you convinced that different departments of the GLA have the skill sets needed to make this work?

Mr Nickson: Particularly with the 2009 UK climate projections it is very difficult to take a risk-based view, so we have been working very closely with the Living with Environmental Change research projects to try and look at exactly these kinds of metrics. I sit on five research projects looking at how we provide design guidance so we can understand how we are measuring our adaptation. One of our projects is to look at how to predict overheating in buildings in the future so when we are asking developers to use this guidance we can judge whether a building is going to be overheated or not and, therefore, how resilient it is to a future climate, but it is a very slow and technical journey.

Ms Dedring: The one thing we did at TfL that was very effective, and again it was on the mitigation side, basically was top-slicing everybody's budget creating a climate change fund into which people could bid. Of course, it was their own money which had been taken away from everyone, so it was the same money, but the incentive it created was to answer this whole problem of, "Well, I want to do this because it's environmentally good but I haven't got Ł100". We required people to bid into this fund which suddenly created a lot of interest in the topic because there was money associated with it. Something in that vein can be very effective. It is probably similar to the equalities agenda too where in every business case that goes through the organisation you have got to say "Have you considered equalities?", "Yes". Have they deeply thought about the issue? How do you actually measure whether people have seriously investigated that question? The more that you can put hard numbers and targets on it you can say, "I'm going to deem you have not seriously considered it unless I see X to be the case". That totally transformed the decision-making process within TfL on the CO₂ front, so we could have something similar on resilience. How you actually specify that, probably the national indicator route rather than the statutory duty route would be more effective to deliver that.

Q150 Chairman: Do the latest climate predictions enable you to assess what the actual impact of climate change is going to be on London?

Ms Dedring: Yes and no. Directionally, yes. I get frustrated because I think we spend a lot of time saying, "Is it a 3.9° increase or a 3.85° increase?" and you think it is a lot more than it is today, it is going to be hotter, what are we going to do about that, and while we are spending all this time arguing about point X or point Y we are not actually doing anything about it. Whether it is 3.8, 3,9 or two you would still want to take action to tackle this problem. In fact, even if you just looked at status quo today you would want to do something about it because we already have drought problems and overheating and those kinds of things. That is one of the nice things about adaptation, it is something people see every year. They will see some form of drought, overheating or flooding in a certain part of London typically, unlike mitigation where it is some amorphous concept of CO₂ going up into the sky, or on air quality where, "It's not affecting me, it's somebody else down the road and not really my problem". That is all to the good. Where we struggle is a lot of the projections are not specific to London and do not necessarily look at the urban environment, they extrapolate from rural projections to draw conclusions for the urban context, so that is something we are doing a piece of work on at the moment that Alex can comment on. It is trying to look at a more micro-level at what is actually going to happen, not just, "It'll be hotter".

Mr Nickson: I have to say I have been working very closely with a number of groups to try and look at how we make UKCP 09 more understandable and the deeper I get into it the more I become confused. It is very difficult to take probabilistic projections and get people to use them unless they know the point at which an exceedence then affects their system. The first thing you need to do is understand how your system responds to various climate variables, to know when you will then change from a business as usual position to a more extreme position that, therefore, has unusual impacts, say, upon your budget or other resourcing. One of the things we have been trying to work with TfL on is to understand how day-to-day climate variables affect their basic operation. When do wind speeds mean that you need to reduce train speeds? When does overheating of tracks mean you need to reduce the train running times? A lot of it is about starting to understand the critical points where these things occur and then using UKCP 09 to understand how much more frequently that will happen in the future. A lot of the delays in the production of the UKCP 09 tools have not helped us to understand that. The critical one was this threshold detector which enables you to determine how many times, say, a certain temperature is going to be exceeded in the future, so if you know that at 32° you have to start changing the way your system works, and you know that today it may be only three or four days a year you can manage that under an emergency measure, but if it is four weeks or four months in the future then you fundamentally need to change the way your system works, we are on an early path on that. The Thames Estuary 2100 Project was a very good example of how to use that. They looked at how various levels of sea level rise affected the number of closures of the barrier, but also where certain responses stop working, so they know that at one metre you can deal with it with the current system, at two metres you need to be raising flood defences inside and outside London and at four metres you need another barrage. We would like to see that now applied, say, to the water system so we know that with a certain number of dry days or dry years in a row you can survive on reservoirs but after that you then need to look at a range of measures, water efficiency, grey water recycling, whatever, and apply the climate scenarios to that. It is early days but there is starting to be the ambition on it and things like the LWEC[4] project will help. I do think we have lost a lot of capacity, particularly in the royal and professional institutions, to really take this by the teeth. Maybe I am being a bit harsh on some of them but I do expect them to be leading the discussion on this. We have got to get away from the current, "Look at the X axis and read off the Y axis and that's what we'll build" back to understanding that there is a grey area on either side and, therefore, we need professional advice on that and I am not sure we have the capacity in the UK on this.

Q151 Chairman: Arising from that answer, what are the implications in terms of cost if you can see the range of things that might happen? Are you starting to estimate what the costs of responding to that are likely to be?

Mr Nickson: We have started to look at some of the cost-benefit analysis. I would give you one exemplar of a guy called Dr William Bird who looked at the health benefits of green spaces. He did a very exhaustive study to look at what was the health benefit per hectare of a green space when monetarised and came up with some incredibly large figure that everyone instantly dismissed because it did not fit in with their mental projection of what they were worth, but when you combine reducing obesity, improving mental health, reducing days off sick and so on, green spaces do have an enormous benefit to society.[5] We have started to do some of that work looking at the benefit of green spaces offsetting the urban heat island effect and in providing sustainable urban drainage. I think we could spend a lot of money and a lot of time going down that pathway to come up with a figure that is dismissed as being incredulously large when actually we just need to get on and do it. We have set ourselves some fairly robust targets for increasing green space in London, both street tree cover and green roofs, pocket parks and so on, because we know it is the right thing to do and, in parallel, we are going to keep working up the arguments on the cost-benefit analysis. I think this dual approach is the right one for us and one we need to encourage.

Ms Dedring: The fundamental point about is it worth it, is there is a cost associated with not doing something. The reason that it is valuable to look at that is to say, "You should be prepared to spend up to X to avoid that happening". For example, we have set a target based on some work they did in Manchester which you are probably familiar with. They looked at central Manchester and if you increased the green cover in central Manchester by 10% it would stabilise temperatures over the next century instead of the kind of rises that the CP[6] work suggests. Obviously those temperature rises have health costs associated with them, rising use of energy for air conditioning and, therefore, a further negative feedback cycle because of that. Presumably that, roughly quantified, would show you that it is worth investing in the green space in order to do it. We have talked a lot about buildings, but things like trees and parks are the first things that get cut in difficult budgetary times that are seen as discretionary, "It's nice to have trees but if we don't have any money we won't have any trees or we won't have any parks". I have been trying to approach some of the financial institutions and government bodies to think about how we can think about this from a purely commercial standpoint. There are benefits associated with X and, therefore, we should be prepared to spend Y, but the problem is how you capture the benefits. On the energy side it is a lot more straightforward but even there it is difficult to do. We are not there yet at all. I think that is what people like the banks and pension funds need to help us to look at.

Q152 Mark Lazarowicz: On this issue of how you pay for the work that needs to be done, given pressures always exist upon public sector budgets what are you doing and what can Government generally do to ensure that adaptation is given a high enough priority in the allocation of funding?

Ms Dedring: One thing that we do is look at all the potential. If you think about it within the organisation it is environment fighting everybody else for funding. Rather than saying, "We need a new budget line item", we say, "Here's a set of activity which actually delivers a more resilient city, delivers adaptation", but may not have been set up deliberately to deliver that in the first place. For example, the London Development Agency underneath the GLA has got a big programme of investment in the urban realm, but because that is about things like making London look nicer it does not necessarily include things like soft landscaping, trees and green roofs, those kinds of things. It might just be something that an architect would deem to be beautiful but would not necessarily have any greenness in it and because that area is being regenerated and redone it is an opportunity to put in a lot more green cover. We are trying to redirect budgets across the board, although that is a small example. There are also cases such as where the Mayor has got a programme to plant 10,000 new street trees in London and that was just a case of cancelling a series of things and reallocating the money. There is usually limited opportunity to do that. There are big funding streams associated with things. Because adaptation is quite cross-cutting there are a lot of funding streams that one can seek to redirect but that is less than satisfactory if you want to do something on a big scale. Unless you can somehow find a way to bring commercial money into these issues through whatever mechanism, and I do not particularly care, whatever is going to work, this will not happen. Section 106[7] is another interesting opportunity which is not publicly exploited to the full extent that it needs to be for a whole range of things, but adaptation is one example of where it is down to the local authorities how they want to use it. They could be requiring developers to increase green cover in that area by X per cent every time a new development is put in if you want to think about an air quality neutrality or water neutrality type of concept.

Q153 Mark Lazarowicz: How do you cope with a situation where certainly in a smaller local authority there can easily be a situation where the opportunities and need for adaptation may be much more than one just literally down the river and that authority may not be able to fund this sort of work internally? How does central Government have a role to basically recognise the fact that different authorities have got different needs and opportunities as far as adaptation is concerned?

Ms Dedring: Not to be too simplistic, there need to be central funding streams for some of these things. It is worse than the mitigation situation where CERT is not adequate but at least it exists, so that is a good starting point. We need to be getting about ten times the amount of money we are getting through CERT into London. What are those funding streams around adaptation? I cannot think of anything. The Defra money, the three million, is an astronomical sum in the world of adaptation. It is partly because it has been so centred on analysis, risk assessment and those kinds of things so it is not seen as a delivery issue which has more funding associated with it. The issue is at the national level can we do something similar as we do at the London level, which is not about making the case for more money, because we are not going to get anywhere with that kind of argument, but about saying, "Look, there are these ten teams which are delivering those kinds of outcomes, so let's either slice bits off of it or lump it together and call it the adaptation programme" and refocusing it in that kind of way. Everyone needs to be pragmatic, there is not going to be Ł10 billion becoming available for something like that.

Q154 Jo Swinson: Obviously funding is an issue but, as you have said, there is a degree of realism here, so to what extent do you think the Government is providing adequate leadership, if not the funding, in terms of the country's response to the adaptation issue?

Ms Dedring: Adaptation reminds me a little bit of biodiversity. It is such a broad phrase that it means everything and nothing to a lot of people. The more concrete we can be, even if it is just saying, "Here is a bunch of statutory activity and funding, all of which amounts to adaptation", so if you are a small local authority that feels you have got enough on your plate, say you have got a lot of poverty in your area, it is not going to be a priority to look at adaptation because it is somewhere out there and you do not need to worry about it, but highlighting some things you can do today with existing funding streams and existing statutory powers could help without creating new big funding pots. Again, something on the National Indicator side could help as well. It is going back to the delivery side. There is not a machinery that is rolling out improvements to how adapted the UK is. There is a lot of work going on around looking at modelling of 2100, or whatever it is, and we now need to start getting into the action side of it.

Q155 Jo Swinson: Do you feel that the Government has properly defined adaptation and communicated what the priorities for action need to be?

Ms Dedring: I would say no.

Mr Nickson: In some ways that is exactly the point of the programme. It is a massive leap forward from where we were even three years ago. The programme is all about identifying what are the priorities and ranking them. That is to be praised. In some ways, it is a shame it has taken us ten years of extreme weather to start to get to grips with it. A lot of that was due to the fact that adaptation was seen as somehow detrimental to mitigation and an acceptance of failure, but I am glad we are now over that and recognise they are perfectly parallel and quite often mutually supportive aims. I would come back to my original point. We still have a problem and there is a lot of inconsistency in government programmes where mitigation measures are acting against or not necessarily supporting adaptation measures. We need the Code for Sustainable Homes to take on adaptation issues much more and building regulations need to be brought up-to-date as well to reflect that. Things like the water calculator in the Code for Sustainable Homes just does not work to incentivise water efficiency, particularly in urban areas. The Building Schools for the Future and the Better Hospitals Programmes are still building hospitals that overheat today and they are going to have to undergo painful and expensive retrofits in the future. There is a lot more that we could be doing now and doing better. Part of that is because no-one has really looked at how to use projections in the future to manage risks today. I do not want to criticise them too heavily, we are progressing in the right direction, it is just painfully slow.

Q156 Dr Turner: Has the Government's Adapting to Climate Change Programme had any effect on your capacity to manage climate change risks, or is there more that the programme could do to support the GLA and other public bodies like yourself?

Mr Nickson: We are unusual in the fact that we are one of the leaders on adaptation, we are the ones asking the awkward questions such as you are now asking of us. We are stuck looking for the same answers. I think the Government is playing catch-up in a number of areas. We are lucky to have UKCP 09, which are the best climate projections in the world, and when we get to understand how to use them properly it will be a phenomenal tool. I think the national risk assessment is the right way to be going. I am advising the Government on it and how to deliver it. The National Indictors on it are the right way to go. Perhaps we should be looking a bit more at outcome-based indicators rather than process-based indicators because that does just encourage a tick-box culture. On all fronts it is progressing in the right direction. I am afraid I do not have a silver bullet that would instantly help us undertake a quantum leap on adaptation but I do think a lot of it is to be supported.

Q157 Dr Turner: Is there a coherent organisational framework to deliver this efficiently?

Ms Dedring: No. It is still at the first stage of the process as far as I can see. It is analytically helpful and moving in the right direction. Statutory duties are great but, again, where is the piece of machinery that says, "Here's all our large infrastructure across the country", whether that is transport infrastructure, energy, whatever it is, "What are the implications of climate change for that, what are we going to do about it? Who is going to invest to make it happen?" That is not happening, it is very ad hoc and depends on the organisation. Everybody is kind of trying to avoid it if they possibly can because nobody really wants to think about the costs associated with that. Where is the programme of large-scale green space preservation and further rollout, whether that is trees, green roofs, who cares, expansion of parks, protection of existing parks. We have got a huge issue in London of paving over private gardens which now the Government has tackled relatively effectively. There is not that systematic how do we get from point A to point B, and there is not even the piecemeal bits of it starting to come together which you do see on the mitigation side. It is not on the scale that we need but we are starting to see the right kind of activity. In building and retrofit we see the same thing. Here is a world that we are going to live in, where London is going to be fully retrofitted, ready for the future, and maybe it is not going to be perfect but I do not see that roadmap at the moment at all.

Q158 Dr Turner: Do you see a role for regional government in the new framework for adaptation?

Mr Nickson: Yes, taking London as an example and maybe obviously given the unique example that the Mayor is, we are able to take a view that is strategic and, therefore, we can encourage local authorities to work collectively on mutual issues where, if they were left to their own devices, they would work probably individually, so that is a unique role we can bring. As demonstrated by the Homes Energy Efficiency Programme, we are able to cobble together large numbers of small schemes to create a more substantial scheme which, by value of its cost efficiency, can deliver much more, so I do think yes, there are very definite benefits to the regional engagement that just cannot be seen and are less effectively done at a national level.

Ms Dedring: Potentially rather than in the statutory duty, national indicator space, but more in the programme delivery and co-ordination. Certainly we have got a lot more engagement from the private sector in terms of participating and putting money into these programmes because they see us as an efficient route to market basically. They are not doing it out of the goodness of their hearts, but they get an opportunity to go into lots and lots of homes, which an individual borough cannot deliver. One of the reasons that we have not had the scale of activity on water efficiency or home energy efficiency needed in London has been because of the sort of piecemeal, "This borough has a 100-home programme here and this has got about a 1,000 homes over here", so that, I think, is where a sort of co-ordination function or single procurement vehicle can be quite useful.

Q159 Dr Turner: Do you see any regional co-ordination going on outside London?

Mr Nickson: I do not feel I am in a position really to answer that.

Ms Dedring: I would say some regions yes, others no, and it really depends. It is a bit driven by personalities and individual parts of the organisation, so it is quite patchy, I guess.

Chairman: Thank you. I think this might be an appropriate moment to move on to the next subject.

[1] Carbon Emissions Reduction Target

[2] Home Energy Saving Programme

[3] Energy Saving Trust

[4] Living With Environmental Change

[5]

[6] UK Climate Projections

[7] Section 106 of the Town and Country Planning Act 1990