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Fourth Carbon Budget

4.41 pm

The Secretary of State for Energy and Climate Change (Chris Huhne): Today I am announcing that the Government propose to set an ambitious target in law to reduce greenhouse gas emissions in line with the advice from the independent Committee on Climate Change.

Signing up to an ambitious fourth carbon budget will result in no additional costs to consumers during this Parliament. We will, however, undertake a review of progress in early 2014 to ensure that our carbon targets are in line with those of the European Union. We are working up a package of measures, to be announced by the end of the year, to help energy-intensive industries adjust to the low-carbon industrial transformation while remaining competitive.

By agreeing to the level proposed by the Committee on Climate Change, we are demonstrating our desire to drive the changes needed to turn the UK into a dynamic, low-carbon economy that is attractive to investors in the new and growing low-carbon sectors. We are also sending a clear signal to the international community that the UK is committed to the low-carbon economy. That will help us to reach agreement in Europe on moving to a 30% emissions reduction target and build momentum towards a legally binding global climate change deal.

The Climate Change Act 2008 sets a target to reduce greenhouse gas emissions in the UK by at least 80% from 1990 levels by 2050. It also requires Governments to set carbon budgets, which are limits on greenhouse gas emissions in the UK for consecutive five-year periods. Carbon budgets must be set at least three budget periods in advance. They are designed to put emission reductions on an appropriate and cost-effective pathway to our 2050 target. The first three carbon budgets were set in 2009, following advice from the independent Committee on Climate Change. The fourth carbon budget, which sets the limit on emissions for the five-year period from 2023 to 2027, has to be set in law by the end of June 2011.

As advised by the Committee on Climate Change, the level that we propose setting in law would mean that net emissions over the fourth carbon budget period should not exceed 1,950 million tonnes of carbon dioxide equivalent, which is a 50% reduction from 1990 levels. As required by the 2008 Act, once the fourth carbon budget has been set in law, we will publish a report setting out the policies and proposals required in the medium and long term to meet the budget, building on the strong foundation provided by our existing policies. That will take the form of the revised Government carbon plan later this year, following the publication of the interim version in March.

The Committee on Climate Change advised that we should aim to meet the budget through emissions reductions in the UK, rather than by relying on carbon trading, such as under the EU emissions trading system or the purchase of international credits from projects abroad. We will aim to reduce emissions domestically as far as is practical and affordable, but we also intend to keep our carbon trading options open, to maintain maximum flexibility and minimise costs in the medium to long term. Given the uncertainty involved in looking so far ahead, that is a pragmatic approach.

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Under the Climate Change Act, emissions reductions by the UK’s industrial and power sectors are determined by the UK’s share of the EU emissions trading scheme cap. That protects the UK industrial and power sectors from exceeding EU requirements. However, if the EU ETS cap is insufficiently ambitious, disproportionate strain could be placed on sectors outside the EU ETS, such as transport. To overcome that problem, and to provide clearer signals for businesses and investors, the Government will review progress towards the EU emissions goal in early 2014. If at that point our domestic commitments place us on a different trajectory from the one agreed by our partners in the EU under the ETS, we will revise up our budget as appropriate to align it with the actual EU trajectory. In line with the coalition agreement, the Government will continue to argue for an EU move to a 30% target for 2020, and for ambitious action in the 2020s.

As part of the transition to a low-carbon economy, we need to ensure that energy-intensive industries remain competitive and that we send a clear message that the UK is open for business. Before the end of the year, we will announce a package of measures for the energy-intensive businesses whose international competitiveness is most affected by our energy and climate change policies. Rising electricity costs pose a risk to those businesses’ sectors, which are critical to our growth agenda. We will therefore take steps to reduce the impact of Government policy on the cost of electricity for those businesses, allowing them to continue to play their part in delivering our green industrial transformation. In that way, we will ensure that those sectors remain internationally competitive and send a clear message that the UK is open for business.

It is important to stress that the UK’s existing policies already put us on track to meet the first three carbon budgets. They also provide a strong foundation for the fourth carbon budget, implying no additional near-term costs. We are reforming the electricity market, making homes and businesses more energy-efficient through the green deal, ensuring that new homes are built to a high energy efficiency standard, encouraging the uptake of ultra-low carbon cars and setting up a green investment bank.

Meeting the 1,950 million tonnes target that we propose for the 2023 to 2027 period is ambitious but achievable. By providing long-term clarity for investors, the fourth carbon budget places the UK at the leading edge of the global low-carbon industrial transformation. It will set Britain on the path to green growth, establish our competitive advantage in the most rapidly growing sectors of the world economy, generate jobs and export opportunities in those sectors, maintain energy security and protect our economy from oil price volatility. It is a framework not just for action on climate but for growth and prosperity.

Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op): I thank the right hon. Gentleman for early sight of his statement this afternoon. May I make it very clear that we welcome the fact that the Government have finally made a decision on the fourth carbon budget? We know that it has been a rocky week for him, as his colleague the Business Secretary sought a very

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different decision on this issue. We also know the many battles that he has lost within Government on the green agenda, so I congratulate him on this progress. I welcome the fact that he has not, after all, ducked the chance to answer questions on this important matter and is here before the House today.

I need to pick up on a point that the right hon. Gentleman made. He talked about our being on track to meet the first three carbon budgets, but I do not really think that is thanks to the current Government. We have seen a go-slow from him on green progress. Can he reassure us that he, the Treasury and the Business Secretary are united in delivering on these challenging targets? Can he be sure that he at least has the support of the Prime Minister?

The importance of this decision cannot be overstated, and I shall not repeat what the Secretary of State clearly laid out on the rationale behind the Climate Change Act 2008, which was established under the previous Government. However, I am puzzled about the 2014 review that he announced, because it introduces new uncertainty for those investing in the country’s greener future and breaks with the five-year cycle. He has already failed to provide business certainty by delaying the green investment bank and pulling the rug from underneath the solar industry. It is therefore essential that the scope of that review is clarified so that it does not do the same.

With those budgets now agreed, the Government must deliver on policies to meet them. As I have said, we have seen over the course of this year the Government failing to deliver on their green promises. The long-awaited green investment bank is unable to borrow till 2015—no rush there!—and it is the subject of yet more disagreements. Confidence in the renewables sector was shaken by a hasty and ill-conceived revision of the feed-in tariff, and of course, the commitment to zero-carbon homes was scrapped with no notice.

The right hon. Gentleman’s confidence in his record belies the facts. He needs to focus on his Department and on the detail of this agenda, which is very important to the future not just of the UK, but of the world. For the UK to meet those targets, we need a clear plan from the Government. The right hon. Gentleman talked about a strong foundation, which we need, but he needs to get real and to deliver on that.

We cannot meet our targets without a major reduction in domestic emissions. It is therefore critical that the Government make the improvements to the Energy Bill that the Opposition have demanded. Most importantly, they need to be clear on what carbon reductions the green deal will deliver, which, as we said last week, cannot be left to the market to decide.

Policy needs to be joined-up if we are to have the green industrial revolution that this country needs. We are clear that there is cross-party agreement on the carbon-reduction trajectory, but I should like to ask a few detailed questions of the Secretary of State. What will be the purpose and scope of the 2014 review, which I have already highlighted? Is there a prospect that the Government will weaken the targets that he announced today, or is he suggesting that they can only be tightened? What are the Department of Energy and Climate Change and the Department for Business, Innovation and Skills

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doing to support energy-intensive industries? When will he have more detail on that? He alluded to that, but we need more detail.

Will the Government introduce clearer aims for the green deal, so that we can be clear on how it will contribute to the necessary emissions reductions? When will we see the national policy statements, including on nuclear? Will that happen before the summer? When will the revised carbon plan be published? Will the Secretary of State and his Department consult widely on that?

After scrapping the grant funding for wave and tidal—we still await the renewables obligation certificates review—how will the UK gain a competitive edge in wave and tidal energy, in which we should be groundbreaking? Will the Secretary of State introduce an accelerated timetable for the trial and deployment of industrial-scale carbon capture and storage for coal and gas?

Does the Secretary of State agree with the Committee on Climate Change that we need to be more explicit in our support for new nuclear and onshore wind? Finally, what plans do the Government have for introducing road pricing, as suggested by the Committee? Has he consulted the Transport Secretary? Is that a policy for the next Parliament, or is there an urgent need to legislate for vehicle use now?

Chris Huhne: Perhaps I would be forgiven for wondering whether the hon. Lady and I have been living in the same country for the past few years. Given the picture that she is painting of policies that have been put in place to deliver on carbon budgets, she should perhaps remember that our inheritance after 13 years of the previous Labour Government is that our renewable sector is 25th out of 27 EU member states. That is not a record of which the hon. Lady can be proud. As for efforts to be made, for example, on energy efficiency, it took this Government to introduce the Energy Bill, which legislates for the green deal, which is the most comprehensive attempt to deal with energy saving in future.

Since the hon. Lady asked, I can assure her that the carbon budget has been approved unanimously by the Cabinet and has the support of the Business Secretary, the Chancellor and the Prime Minister. It is an important commitment by the Government, because it is the first commitment beyond the period for which the EU has legislated. Unlike the previous Labour Government’s three carbon budgets, this one goes beyond what the EU requires of us. We have set it according to our own domestic legislative framework and with our own domestic legislative agenda.

The 2014 review will be simple and clear. On the traded sector, which is crucial to our international competitiveness, we will review what is happening in the rest of the EU, because it is appropriate that we move at the same pace as the sector there. The hon. Lady mentioned that the green investment bank can borrow in 2015, which is crucial because the second part of this decade will see the greatest need for borrowing powers to ensure the installation of renewable and other low-carbon energy. I am astonished by her description of what has happened so far under this Government. We have set aside more than £800 million for a renewable heat incentive, and we are legislating for a carbon price floor.

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Despite the Opposition’s warm words, in 13 years of a Labour Government not a single piece of turf was turned in order to install a single new nuclear reactor, yet work has already begun at Hinkley Point. The sense of urgency in dealing with the climate change challenge displayed by this Government is of an entirely different order of magnitude. On clean coal and gas, about which the hon. Member for Bolsover (Mr Skinner) and some of his friends are particularly concerned, the Government, in an extremely tough and difficult expenditure round in which we have to clear up the mess inherited from the Labour party, found £1 billion to set aside for the first commercial-scale carbon capture and storage project. In 13 years under Labour, no money was put aside and no planning was done for low-carbon growth.

We will proceed with our national planning statements, and there will be an interim review by the nuclear regulator, Mike Weightman, which I anticipate coming shortly. The hon. Lady asked a detailed question about road pricing. We have made it clear already that there will be no plans for that in this Parliament. I repeat, however, that we are set on a road that will unlock enormous opportunities for British business, with a low-carbon economy and high growth.

Several hon. Members rose

Mr Deputy Speaker (Mr Nigel Evans): Order. I ask hon. Members to respect the convention that they do not question the Secretary of State if they were not here for the entirety of his statement.

Mr Tim Yeo (South Suffolk) (Con): This is a most welcome decision by the Government. Does my right hon. Friend agree that there are considerable potential economic advantages for Britain in leading the world towards a lower carbon economy? Does he further agree that, although it is understandable that the Government should wish to retain the option of purchasing credits in order to achieve the target, the sooner that option is ruled out, the greater the incentive will be for British business to invest in low-carbon technology?

Chris Huhne: I very much agree with the hon. Gentleman, the Chairman of the Energy and Climate Change Committee, who has made a powerful case in the past for a low-carbon economy. This is no longer a set of cottage industries. We are talking about a sector of the British economy that employs 910,000 people, which is growing extremely rapidly in a major world market, and which offers us enormous opportunities. I have no doubt that to those who move first and furthest will come the great advantages of the low-carbon economy. On the point about purchasing credits, having in a misspent youth practised economic forecasting and knowing about the difficulties of getting forecasts right one or two years in advance, I think it makes pragmatic sense to preserve a little flexibility when looking ahead as far as 2023-27.

Joan Ruddock (Lewisham, Deptford) (Lab): We are on track to meet our first three carbon budgets because of the policies put in place and pioneered by the Labour Government. The right hon. Gentleman is yet to deliver on any of his flagship policies. When he speaks of renewables, does he not have some concern about the

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Ernst and Young report showing that only 13% of UK-based corporates, financiers and clean-tech companies believe that the coalition will create an environmental success this year?

Chris Huhne: I am grateful to the right hon. Lady for her question. She has followed this area for many years and has enormous expertise in it. However, if she is going to claim the credit for meeting the current carbon budget on the back of the previous Government’s record, she should be aware that an important contributor to the 28% reduction in our carbon emissions since 1990 has been the depth of the recession. I am glad that she is at last owning up to the impact that those on the Opposition Benches had on our economy. On the Ernst and Young report, we are determined to set a framework that provides certainty and clarity for investors, and we will do so particularly with the electricity market reform that we shall be announcing later.

Mr John Redwood (Wokingham) (Con): How exactly does the Secretary of State propose to ensure that the glass and ceramics, and steel and chemicals industries, which are high energy users, are not damaged by the taxes and regulations that he is proposing today?

Chris Huhne: I am grateful to the right hon. Gentleman for his question. The energy-intensive work group that we have set up between my Department and the Department for Business, Innovation and Skills will come forward with a set of measures by the end of the year. That is a clear commitment. As he knows, there are a number of ways to help energy-intensive industries, including the free allocation of units under the EU emissions trading scheme and encouraging a move towards the use of biomass and biofuels, for example. We are looking at all those measures to ensure that we can balance the concerns of the energy-intensive industries as well as make substantial progress towards the low-carbon economy.

Malcolm Wicks (Croydon North) (Lab): The climate change targets that the last Parliament legislated for were arguably the most ambitious thing that any Parliament in this country has ever legislated for. I certainly welcome the broad thrust of the coalition Government’s proposals today, even if the Secretary of State failed to understand that turning over turf during his term of office depended on four years of preparatory work, which I am happy to discuss with him.

Many of the goods that we consume in Britain used to be manufactured in Britain. They are now manufactured in places such as China, thereby producing carbon emissions, and then imported into this country. Those carbon emissions in China and elsewhere occur only because of demand from western societies such as ours. Given that we are talking about a global phenomenon, does the Secretary of State have any ideas for how Europe as a whole can use its influence to bring about appropriate carbon reduction policies in places such as China, India and elsewhere?

Chris Huhne: The right hon. Gentleman’s question is an interesting one, as I would expect, given his background as an Energy Minister and his expertise in this field. Wherever one goes in the world, people will say that everyone else is working much less hard on the low-carbon

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agenda than they are. That is the prevailing myth. I was recently speaking to my counterpart in Australia, who said that the entire debate there is about how only the Australians are dealing with climate change and no one else is. The reality is that enormous progress is being made on this agenda right across the board, including in India and China. The five-year plan that the Chinese have just established is enormously ambitious. Six of the largest renewables companies in the world are now Chinese. The Chinese are making an enormous commitment to offshore wind, as well as in more conventional sectors such as nuclear. They are now the dominant player in solar photovoltaics, having taken the lead from Germany, so I simply do not accept that this is a world where we are moving ahead of other people. We are moving ahead together, but it will be the people who move furthest and fastest who get the best prizes.

Laura Sandys (South Thanet) (Con): Will the Secretary of State confirm that, when he publishes the plan in the next couple of months, it will include an industrial plan that supports the green economy, not only in the energy sector but right across the manufacturing sector in areas such as white goods manufacturing and the production of electric cars? Will he also ensure that his Department and BIS provide the support to ensure that we have all the necessary skills and investment?

Chris Huhne: My hon. Friend makes a good point, and I know that it is a heartfelt one because of her commitments to her constituency. I remember her being present when I opened the wind farm off Thanet. There will be enormous opportunities as a result of our proposals. We set aside £60 million for port transformation in the comprehensive spending review, for example, and we now have some substantial commitments of interest, including from Mitsubishi in Scotland, from GE and from Siemens in Humberside. Vestas is also talking about an area close to my hon. Friend’s constituency in Kent. I believe that we will see an enormous amount of investment in those crucial industries. Our carbon plan will focus on meeting our carbon objectives, but the work that BIS, in particular, is doing to lead the charge for the carbon economy is very important, and I am backing it completely.

Barry Gardiner (Brent North) (Lab): I congratulate the Secretary of State on stepping up to the plate on this issue; it is really good that he has established that it is he, and not the Business Secretary, who is in the driving seat. I want to ask him about long-term clarity for investors. He mentioned that that was key, but he will appreciate that those wishing to invest in gas now risk seeing their investments stranded after 2025. It is extremely important, when addressing that question, that he review the proposals on electricity market reform to ensure that those investments can be maintained.

Chris Huhne: We have every intention of ensuring security of supply, and gas will perform an important role in that regard, in the short run and in the medium run. Given the worldwide potential for the exploitation of unconventional gas from shale and other formations, it might well be the case that gas will play a long-term part in our energy mix as well, through clean coal and gas, and carbon capture and storage. I take the hon. Gentleman’s point on board, however, and we will not

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have stranded assets of the kind he describes. We will be introducing our proposals in the White Paper on electricity market reform.

Andrew George (St Ives) (LD): I warmly welcome my right hon. Friend’s statement to the House today, and his commitment to ensuring that the UK will be the first country in Europe to have legally binding emissions targets beyond 2020. Further to the point raised earlier by my hon. Friend the Member for South Thanet (Laura Sandys), what can his Department do to ensure that the green growth industries are able to take full advantage of the opportunities that this statement and the Government’s policy will provide?

Chris Huhne: We are determined that there should be enormous growth opportunities for low-carbon goods and services in the UK, and I would like to highlight two things that our Department can deliver. The first is the certainty required to enable investment in the replacement of ageing power plant that we will need over the next 10 years. Ofgem has estimated a figure of £200 billion, which is roughly double the normal level of investment in the UK, so this will be important in powering the recovery over the next few years. The second is the provisions in the Energy Bill, the Second Reading of which took place last week. The green deal, which is set out in the Bill, will provide the opportunity for an enormous number of new jobs. We calculate that we will move up from the present figure of 27,000 jobs in the insulation sector to 100,000 by 2015 and that, at its peak, the policy will result in 250,000 jobs right across the industry, which will have to retrofit every home in the country. My hon. Friend is absolutely right to highlight the enormous job-creating potential for these industries, and we will keep that matter very much in the forefront of our minds.

Dr Alan Whitehead (Southampton, Test) (Lab): I congratulate the right hon. Gentleman on coming out on the right side of the scrap in Cabinet over the fourth carbon budget. Does he accept, however, that according to the Climate Change Act 2008, a fourth carbon budget with a review in 2014 will not really be a fourth carbon budget in law? Can he confirm that a review in 2014 would not change the law as far as the fourth carbon budget was concerned? If that is the case, why should there be a review?

Chris Huhne: The key point of having a review is to make sure that in the tradeable sector, where we have industries exposed to international competition—and we want them to thrive—industries are not exposed to unique costs that will not be imposed on the competition in the EU. That is what the review is designed to achieve. Under the Act, any review will have to be preceded by a recommendation from the Climate Change Commission—and we have absolutely no plans to change that, so it will depend on recommendations from that commission.

Christopher Pincher (Tamworth) (Con): I welcome my right hon. Friend’s ambitious announcement. I remind him that in evidence to the Energy and Climate Change Select Committee, Lord Turner said that our carbon targets might lead to an appreciable increase in domestic energy prices. I urge the Secretary of State to roll out the green deal with all speed to ensure that any domestic energy price increase is offset by the energy saving elements of that green deal.

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Chris Huhne: I can assure my hon. Friend that we in the ministerial team are absolutely committed to low-cost, affordable electricity. The last assessment the Department made—at the time of the annual energy statement, and we will make another at the next such statement—is that the overall impact of our policies, including energy saving and the effects that my hon. Friend mentioned, will add 1% to the cost of household energy bills in 2020. As it happens, that was posited on a world oil price of $80 a barrel. As he knows, the oil price has moved substantially beyond that. With oil prices and associated gas prices higher than $100 a barrel, our estimate is that our policies will save money for the British household. I am not saying that British households will not face increases in the cost of gas and electricity in future; what I am saying is that the policy mix of energy saving and low-carbon electricity generation will give a better deal to British households than would reliance on imports of variable fossil fuels from volatile parts of the world.

Mr Michael Meacher (Oldham West and Royton) (Lab): Does the Secretary of State accept that purchasing carbon offsets abroad as a means of meeting carbon emission reduction targets in the UK is deeply flawed on grounds of additionality, leakage and uncertain duration and that, in any case, they do not achieve the ostensible objective of decarbonising Britain? What precise proportion of the 29% cut in carbon emissions planned between now and 2027 do the Government intend or expect to be achieved via carbon offsets?

Chris Huhne: I can assure the right hon. Gentleman that we intend to try to meet all the reductions we have set out from our domestic activity. That is the clear intention of setting out the fourth carbon budget as we have. However, given the enormous uncertainties of making projections so far in advance, it would not be sensible for us to rule out the flexibility afforded by carbon trading at the relevant time.

Tony Baldry (Banbury) (Con): If my right hon. Friend is going to meet these targets by reducing emissions here, it will mean reducing a lot of emissions from domestic housing. Will he give us more information about how he is going to achieve that with existing housing, and what exactly does he mean when he talks of ensuring that new homes are built to a high energy efficiency standard? What is a high energy efficiency standard in relation to zero carbon?

Chris Huhne: My hon. Friend knows that the lead Department on zero-carbon homes is the Department for Communities and Local Government. It has set out its thoughts on this issue. I am pleased to see that we intend to continue with the substantial improvement in energy efficiency standards in the 2013 and 2016 building regulations. On that basis, we will move quickly towards a zero-carbon homes standard, which will make a major contribution to meeting our long-term carbon reduction goals of 80% by 2050.

Caroline Lucas (Brighton, Pavilion) (Green): I welcome the Government’s acceptance of a 50% emissions cut by 2025, but like others I am deeply concerned that behind a headline that looks so good in theory is something that risks being a sham. In reality, a significant proportion

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of the reduction will be happening in other countries. What impact does the Secretary of State expect that to have on the “green industrial transformation” that he says that he wants? Such a transformation will not happen if we pay other countries to do the work for us.

Chris Huhne: I can add very little to what I have already said to the right hon. Member for Oldham West and Royton (Mr Meacher). We are, in fact, dealing with a period that is very far off—well beyond the normal range of economic forecasting—and it is sensible for us to exercise a measure of flexibility in the way in which we achieve our aim. However, I can assure the hon. Lady—as I assured the right hon. Member for Oldham West and Royton—that we intend to meet this budget from our domestic activity. That is absolutely in line with everything that I have said about encouraging low-carbon goods and services.

The hon. Lady should also bear in mind that even the flexibility that is afforded by trading will be limited by the existence or otherwise of far cheaper opportunities to ameliorate the position by mitigating carbon emissions outside the country rather than inside it. I believe that the more we invest in the industries that I have mentioned, and the more “learning by doing” that we do, the greater will be the chance of our meeting our targets entirely from domestic activity, which is what we intend to do.

Zac Goldsmith (Richmond Park) (Con): I strongly welcome the statement. What contribution does the Secretary of State think demand-side measures are likely to make in a reformed electricity market, particularly given the focus on negawatts?

Chris Huhne: The concept of negawatts is very important. Let me explain to those who have not followed the debate that it means we should be able to trade into the electricity system savings in energy and not merely electricity generation. That concept is part of the consultation that we are currently considering about electricity market reform, and I believe that it will be a crucial part of our reform proposals. There are several different aspects, but I am sure the hon. Gentleman will not be disappointed when he sees the results.

Simon Danczuk (Rochdale) (Lab): The proposals on climate change are extremely important. Can the Secretary of State assure the House that they will receive his full attention over the coming days and weeks?

Chris Huhne: I can indeed.

Sajid Javid (Bromsgrove) (Con): The strategy announced today contains a “ripcord”: the targets will be reviewed in 2014 if they prove to be more aggressive than those of our European Union partners. Does my right hon. Friend agree that that will be important to energy-intensive industries in Britain which are themselves important to our future prosperity and the creation of jobs?

Chris Huhne: I do. I noted the criticism from Opposition Members, and I refer them to a bit of socialist history. The attempt to build socialism in one country under Joe Stalin was not an unalloyed success, and, similarly, an

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attempt to build climate change policies in one country would not be an unalloyed success. We must keep a weather eye on the competitiveness of our industries and on what is going on overseas, but we have set a very clear direction. We will be ambitious in our climate change goals, and I am determined for us to drive the growth of these new opportunities and industries as a result.

Gavin Shuker (Luton South) (Lab/Co-op): The Secretary of State has led the House to believe that a review of progress early in 2014 was intended to ensure that the emissions trading system trajectory agreed by the EU could be revised up. Can he rule out the possibility that those ambitious targets will be revised down?

Chris Huhne: Were our EU partners to move even further and faster than we are currently suggesting, we might indeed see revision in the other direction, but I think that the hon. Gentleman accepts as much as I do that the chances of that happening appear to be remote at the moment. I think that we are making progress with our aim to achieve a 30% reduction in carbon emissions by 2020. A number of other countries have joined us in the call for that, including, recently, Denmark, Sweden and Spain, and I am confident that we will make further progress among our partners in the months to come.

Jason McCartney (Colne Valley) (Con): I welcome my right hon. Friend’s statement. Businesses in my part of west Yorkshire are already playing a major part in the green economy. David Brown Engineering in Lockwood make the gears for offshore wind turbines and is very appreciative of a £2 million investment from the regional growth fund for a research centre there; TEV Ltd in Brighouse is investing in air source heat pumps; and the then Conservative-run Kirklees council introduced the warm zone scheme. Does my right hon. Friend agree that as we cut emissions, the number of green jobs will increase?

Chris Huhne: I certainly do. I think this presents an enormous opportunity for the future. There will be enormous numbers of jobs in energy saving and in the other low-carbon goods and services, and that will be the case right across the country. There will be no bias towards one region or another—no bias towards London and the south-east, for instance—because homes, and therefore the industrial opportunities, exist everywhere.

Mark Durkan (Foyle) (SDLP): The Secretary of State has explained why he is resiling from the Committee on Climate Change advice to forgo the carbon trading option, but is he proposing to sidestep any of its other recommendations? Also, do any of his concerns for ensuring the competitiveness of energy-intensive industries and for signalling certainty to investors extend to feeling regret about the adverse impact of the Chancellor’s raid on the CRC scheme?

Chris Huhne: We have not accepted a number of the other detailed recommendations in the committee’s report, but the trading one is an obvious example. It also asked us to set a target for 2030, and we do not see the need for that. I am not a great believer in intermediate targets when we have a very clear overall carbon budget, but given our commitment to a target figure of 1,950 million

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tonnes for the overall carbon budget for 2023 to 2027, nobody should be in any doubt about the thrust of our policy or our determination to meet our target. I have a very strong preference for achieving what we are actually trying to do, which is to cut carbon emissions, rather than for setting a whole group of intermediate targets, but that we will do.

Gavin Barwell (Croydon Central) (Con): I warmly welcome the Government’s decision to accept the independent committee’s advice. Further to the question I asked my right hon. Friend on Second Reading of the Energy Bill, can he confirm that the Government report setting out the policies and proposals required to meet the budget will include an assessment of the contribution each will make so that the House can assess the value for money that they offer?

Chris Huhne: I am concerned to ensure that all our policies offer real value for money. I believe the only way we will be able to hold public consensus behind what is a very ambitious programme of industrial change is if we show we are really ensuring that we get value for taxpayers in each policy we pursue. That is why we had to take the decision we took on solar feed-in tariffs. Although everything was unchanged below two tennis courts-worth, we have had to review the solar tariffs for the larger scale solar because we are determined to get good value for money. That is crucial. I also take on board the fact that the OECD’s latest country report urged us to look at the different implicit carbon prices in our policies across the board. I very much take that to heart and we will look at it. I can therefore assure my hon. Friend that we will address value for money, and that it is foremost among our considerations in delivering good policy.

Geraint Davies (Swansea West) (Lab/Co-op): Does the Energy Secretary believe that it would help to achieve his carbon targets if the speed limit for cars were lowered, or does he think the speed limit for cars should be raised, as do the Transport Secretary and, presumably, the Energy Secretary’s wife?

Chris Huhne: The Transport Secretary has responsibility for these matters, and it is well above my pay grade.

Mr Steve Brine (Winchester) (Con): I thank the Secretary of State for his statement and welcome the Government’s ambition in this area. Given the critical role local authorities must surely play in delivering their goals, how does the Secretary of State intend to help local councils do their bit?

Chris Huhne: The most important way in which this Government can help local councils be innovative, creative and imaginative is to get away from telling them what to do from Westminster. We must remove ring-fencing and make sure local councils can take responsibility for their own decisions. As my hon. Friend knows, we have some robust debates about the priorities between different levels of government in Hampshire, and that is as it should be. Those priorities are determined by the councils—whether the county council at Winchester by the Conservatives, or the district council at Eastleigh by the Liberal Democrats. They make different decisions and it is proper that they should then be accountable to local people for those decisions.

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Alex Cunningham (Stockton North) (Lab): I, too, am pleased that we got a statement on this today, but I am anxious about the future and viability of energy-intensive industries, such as those in my constituency which have been the backbone of the north-east England economy. They have done much to reduce emissions already, but what will the Government do to help with transition funding, possibly through the growth fund or other mechanisms, to ensure that such industries can make further change and develop in the future?

Chris Huhne: The hon. Gentleman is right to mention the growth fund, which is having a tremendous impact in bringing in a vast amount of private investment where it would not otherwise have been occurring; that is definitely a tremendous innovation. In addition, we are and will be developing the package for the energy-intensive industries, which I mentioned earlier. That is being done with our colleagues in the Department for Business, Innovation and Skills, and it will be coming forward by the end of the year. We want balanced growth so that all parts of the economy can benefit from a robust economy.

David Rutley (Macclesfield) (Con): I, too, wish to add my thanks to the Government and welcome the steps being taken to move to a low-carbon economy. It is also encouraging to see the great work being done by community groups, particularly Macclesfield Transition Town and Food4Macc in my area, to support these ambitions. Can my right hon. Friend tell the House what steps he is taking to engage these community groups in helping to achieve these very important targets?

Chris Huhne: We are keen to engage community groups; the ministerial team does a lot of visits and makes sure that we are talking to members of civil society and, of course, to non-governmental organisations, which have an important influence on community groups. This is also particularly crucial in an area that I know can be controversial, even among those on the Government Benches: proposals for onshore wind. I think that that is a beautiful form of renewable energy, although I know that that opinion is not always shared across the House. It is an important part of our strategy to get community groups involved and owning these policies, and some interesting proposals have been made. For example, the biggest proposal for onshore wind is the Viking proposal for Shetland and it is half-owned by the community group that supports Shetlanders. So I am very much in favour of the sort of engagement that my hon. Friend has rightly suggested.

Nia Griffith (Llanelli) (Lab): Given his comments today and previously, the Secretary of State is obviously keenly aware of the danger of carbon leakage, particularly if the Government proceed to reduce emissions through unilateral taxation on the energy-intensive industries. So what consideration has he given to an annual assessment of UK emissions on a consumption basis—an assessment taking into consideration imported goods—because that would act as a real incentive for us to reduce our emissions properly here in the UK?

Chris Huhne: The hon. Lady raises an important issue that people periodically talk about, which is that no matter how well we do in the UK, we are not making a difference to the world as a whole if we are merely

17 May 2011 : Column 189

outsourcing production of carbon-intensive goods to economies such as China. However, I would make two points in response, the first of which is that we should not underestimate the progress being made in economies such as India and China to grapple with and move very fast on this agenda. The Department and the Government are working with the low-carbon pilot areas in China and the developments are truly impressive, so I urge her to look at them. We are aware of this issue, but I do not think that any time soon we will be able to move globally towards a situation where we are taking into account the embedded carbon emissions in trade. The reality is that most of the nearly 200 countries that are members of the United Nations are fiercely protective of their own territorial sovereignty, so it seems likely that our major efforts to tackle climate change will be based on states’ control of their own territorial integrity.

Jo Swinson (East Dunbartonshire) (LD): I congratulate the Secretary of State on accepting the ambitious fourth carbon budget recommended by the Committee on Climate Change. His statement highlights how vital it is to increase the EU carbon emission reduction target from 20% to 30% by 2020, so how will the Government redouble their efforts to secure that agreement and, in particular, to get a significant tightening of the EU emissions trading scheme cap?

Chris Huhne: I am grateful to my hon. Friend for that question. We have made substantial strides in the direction of securing an agreement and a number of countries in the EU are clearly signed up to the 30% ambition level for 2020. A number of other countries would like to go beyond 20%. The European Commission is the key player and one of the points that it is making—rightly I think—is that if we as a European Union were to deliver on just the energy efficiency commitments that we have already made, we could get to a 25% cut in carbon emissions by 2020 without any additional cost. There is a lot of progress to be made on this agenda and I and my ministerial colleagues are pressing that point at all the meetings we attend in Brussels and elsewhere. I believe that we are making good progress.

Jessica Morden (Newport East) (Lab): One issue for intensive energy users is the cumulative effect of Government policies on their competitiveness. Has the Minister carried out a full impact assessment of the cumulative effect of climate policies and, if not, will he commit to doing so?

Chris Huhne: The group that is considering the impact on energy-intensive industries is certainly taking into account all the impacts of policy as well as the other impacts. Obviously, some effects on energy-intensive industry have nothing to do with policy and there are some macro-economic effects, such as the relative competitiveness gained through the improvement in the real exchange rate. We will take account of all those factors when we come to conclusions about the measures necessary to help energy-intensive industries.

Graham Stringer (Blackley and Broughton) (Lab): The Secretary of State has mentioned on a number of occasions the increased number of jobs in the renewables

17 May 2011 : Column 190

sector of the economy. This March, Verso Economics produced a report for the Scottish Parliament that showed that for every job created in the renewables sector 3.7 jobs were destroyed in the rest of the economy. How does he marry that report’s conclusions with the statements he has been making?

Chris Huhne: For every report that reaches the sort of conclusion that the hon. Gentleman is suggesting, I can point him to other reports that suggest exactly the opposite. The OECD, which is probably the most respected and authoritative of international economic organisations, has done some very good work on green growth. We have had a very important study from Potsdam in co-ordination with a number of leading economists from Oxford and elsewhere that suggests that there are positive growth effects through investment and learning by doing. Recently, I received a very important note from Professor Nick Stern—Lord Stern—arguing that the attempts to see his report as imposing costs on the economy were simply mistaken. He feels very strongly that the move to low-carbon goods and services involves enormous opportunities and that the increase in investment involved can help to power us out of an exceptionally deep recession. That is perhaps a long answer to show that when two economists are in a room, there are sometimes three opinions. None the less, the balance of argument is very much against the hon. Gentleman’s point.

Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op): The Secretary of State has made a number of points this afternoon, but one point that came out of the findings and recommendations of the Committee on Climate Change was that international aviation and shipping should be included in future carbon budgets. Does he agree with that recommendation?

Chris Huhne: It is certainly one thing that we intend to consider. It is important, but there are obviously technical issues to be resolved and discussions are ongoing within Government. When we reach a conclusion, we will make an announcement.

Chris Williamson (Derby North) (Lab): This issue should transcend party politics, but I regret to say that some of the Secretary of State’s actions do not live up to his rhetoric. This morning, I met representatives from East Midlands airport whose ambition is to make its ground operations carbon-neutral. The plan was to provide 36% of the airport’s energy requirements through a major photovoltaic scheme that has now been made unviable as a result of the wholesale butchery of feed-in tariffs. Will the Secretary of State tell the House whether he has abandoned photovoltaic cells as a way of generating energy and what advice can he give to East Midlands airport about its ambition to deliver a carbon-neutral target?

Chris Huhne: The hon. Gentleman should perhaps be aware that the intention of the feed-in tariff scheme was to encourage microgeneration. Any proposal that involves less than two tennis courts-worth of solar photovoltaic cells will be completely unchanged by the review that we have announced, so he is clearly referring to a scheme that is very much bigger than that. All I would say is that we have to look at value for money. I am surprised that Opposition Members think that that is a revolutionary

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concept but it is important to consider value for money. If we had not announced the review, we would have found that a very large part of some of our finest shire counties would, instead of disappearing under oil seed rape or some more conventional crop, have been disappearing under solar photovoltaics. That was not, I am sure, the intention of the Opposition. It certainly is not our intention and that is why we have acted.

Mr William Bain (Glasgow North East) (Lab): Does the Secretary of State accept the commission’s finding about seeking a reduction of 44% in emissions from surface transport by 2030 in comparison with the figures for 2008? If he does, will he make representations to the Secretary of State for Transport to put right the cuts in the budgets for electric-powered and hybrid vehicles that were made in the spending review, which put the long-term viability of those industries at risk?

Chris Huhne: I do not think that the policies that my right hon. Friend the Secretary of State for Transport has introduced can be characterised in the way that the hon. Gentleman suggests. We recently did some calculations that suggested that, given the prices we have at the petrol pump today, it makes sense to buy an electric vehicle because of the subsidies that the Secretary of State for Transport has announced in co-operation with my right hon. Friend the Chancellor. I believe that the framework has been set for very rapid growth in this area and I am confident that that is what we will see.

Paul Flynn (Newport West) (Lab): As the continuing and intensifying nightmare of Fukushima has undermined the public’s confidence in nuclear, and because no nuclear power station, old or new, has ever been built on budget, on time or without public subsidy, does the Secretary of State still persist in his belief that nuclear power stations can be built here without public subsidy? If so, will he explain who will pay the billions in insurance and compensation if a major incident occurs? Will it be the industry or, as in Japan now, the taxpayer?

Chris Huhne: The hon. Gentleman has a long track record of concern on this subject, which I respect. Some of the answers to his questions will be there when we see the interim and then the final report from the chief nuclear inspector, Mike Weightman. I hope that we can bring that forward very rapidly and then the hon. Gentleman will be able to see for himself. He is right in one respect, on which I entirely agree with him: if there is to be, as the nuclear industry hopes, a nuclear renaissance, it is absolutely crucial that the nuclear industry shows that it can deliver on time and to budget. Investors will not come forward on a repeated basis if that is not the case.

I can certainly confirm that we will not be providing public subsidy to nuclear and that we see nuclear as part of the energy mix for the future provided that safety concerns are met—we have the Mike Weightman review to be announced shortly—and provided that investors are prepared to come forward. At the moment, the indications are that investors are prepared to come forward provided that we put in place, as I believe the House has already done with the regulatory justification, the necessary steps to facilitate the normal big infrastructure spending that it involves.

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Dangerous Driving (Maximum Sentence)

Motion for leave to bring in a Bill (Standing Order No. 23)

5.39 pm

Karl Turner (Kingston upon Hull East) (Lab): I beg to move,

That leave be given to bring in a Bill to increase the maximum sentence for a conviction of dangerous driving from two years to seven years; and for connected purposes.

Before my election to the House, I worked as a criminal barrister. One of the last cases that I was instructed in was defending a dangerous driver. I recall the grim expression on the face of the Crown Court judge when I got into the mitigation, not because I was wrong to ask for leniency, but because the law gave the judge insufficient discretion to mark the offence with an appropriate punishment. The driving was bad, but not the worst the judge had seen. Nevertheless, it was horrendous driving. I was keen to emphasise that it was not the worst of its kind. I finished my address by asking the judge to allow the defendant full credit for his guilty plea, and sat down knowing that I had done my best for my lay client.

Coincidently, one of the first cases that I dealt with as a Member of the House concerned the victim of dangerous driving, Katie Harper. Her case motivated me to push for a change in the law. Dangerous driving requires the prosecution to show that the driving falls far below what would be expected of a competent and careful driver, and that it would be obvious to a competent and careful driver that driving in that way would be dangerous. There is no definition of “far below”, but the danger must be either that of injury to any person or serious damage to property. The offence is not made out where the driving is less than truly dangerous.

The sentences handed down by judges leave victims feeling let down by the justice system when the offender is released from prison after just a few months, by which time the victims have not even started to come to terms with the damage that the offender has caused. Victims of dangerous driving are sometimes left brain damaged, paralysed or with amputations. The perpetrator will of course be punished, but the law does not currently allow the sentencing judge enough discretion to provide anything like the result that victims might expect. However, in the case of a serious assault, such as grievous bodily harm, the sentencing judge has at his disposal the discretion to mark the offence with a sentence that reflects the harm caused to the victim.

My constituency case helped me understand the real effect on victims of dangerous driving where injury results. In 2009, Katie Harper was a healthy 23-year-old English degree student until she was hit by another car overtaking a line of traffic at seriously excessive speed. Her passenger was her mother, Christine. Katie suffered multiple breaks to her pelvis, two broken arms, facial injury and serious nerve damage to her right leg. Her mother has also been left with permanent injuries after the near-fatal incident. The entire family have suffered. Katie’s father, Paul Harper, retired early from his job as a primary school teacher to provide the round-the-clock support that his wife and daughter need. My constituents’ case is by no means the worst.

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The House will remember the tragic case of Cerys Edwards, an 11-month-old toddler. The Edwards family were the victims of a dangerous driver in 2006. Cerys has needed round-the-clock care since the collision. The driver was doing 70 mph in a 30 mph zone. He lost control of his mother’s Range Rover while overtaking. Cerys was left severely paralysed, brain damaged and reliant on a ventilator to breathe. The dangerous driver was released from prison after just six months. Cerys’s father, Gareth Edwards, is reported to have said, “It just goes to show we don’t have a justice system in this country”, when he heard that the offender had been released.

Many judges have described in their sentencing remarks their frustration at the inadequacy of the law. In researching my Bill I took the time to seek advice from the Recorder of Hull and East Riding, His Honour Judge Mettyear. Judge Mettyear told me that every judge in the country would, in his view, want to support this proposal. There is a clear anomaly in the law. Dangerous driving carries a maximum sentence of two years, whereas causing death by dangerous driving is worth 14 years.

To highlight the disparity, let us imagine the following situation. Two young men who own powerful cars spend a Saturday afternoon with friends in a park. One suggests to the other that they should have a race. The friends warn them of the danger. One of them is not so keen, but he is heavily encouraged by his girlfriend, who offers to accompany him. He reluctantly takes up the offer and they race through the crowded streets, overtaking each other in the face of oncoming traffic, which has to swerve to avoid collision. They continue at great speed in order to escape the police. As they try to navigate a bend, they lose control. One of them ploughs into a bus stand, causing serious injury. The other manages to swerve to avoid the bus stand but hits a tree. His girlfriend, who is a passenger, is tragically killed. The other driver is lucky and does not cause death, but he leaves his victim paralysed and permanently brain damaged.

The one who causes the death will face up to 14 years’ imprisonment. The one who leaves the innocent victim paralysed and brain damaged will face a maximum of two years’ imprisonment. This sentence must then be reduced by one third, as credit for pleading guilty, and then further because it is not considered the worst such case that the judge has seen. The offender will serve a matter of a few months in prison, but what sentence does his innocent victim face? In this scenario, the culpability of the driver who caused death was in some

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ways less than the one who was lucky and did not. How is that justice? My motivation is compounded by the forthcoming justice Bill, which proposes to increase the discount for an early guilty plea from one third to 50%, which means that even the worst example of dangerous driving will attract a starting sentence of only 12 months.

I am grateful for the cross-party support I have received for my Bill. Over the past few weeks, I have spoken with right hon. and hon. Members from across the House, and their advice and encouragement has been gratefully received. I am grateful to Louise Casey, the Victims’ Commissioner, for her support and invaluable advice. I have also discussed my proposal with my area chief constable, Tim Hollis, who fully supports my efforts. The charity Brake welcomes the proposals and the AA, Aviva and the RAC have also committed their support.

I know that my proposal is unlikely to find its way on to the statute book in its current form, but I hope that those on the Government Front Bench will take on board the points that you, Mr Speaker, have allowed me to make. The Bill requires a simple amendment to paragraph 9 of schedule 2 to part 1 of the Road Traffic Offenders Act 1988. The effect, however, would be substantial. The Bill would allow judges the discretion to redress the balance in favour of the victim. The proposed legislation addresses an anomaly in the law and offers a proper deterrent. I respectfully invite the House to support it.

Question put and agreed to.


That Karl Turner, Anna Soubry, Mr Elfyn Llwyd, Mr John Leech, Julie Hilling, Chris Evans, John Mann and Andrea Leadsom present the Bill.

Karl Turner accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 9 September, and to be printed (Bill 190).

localism bill (ways and means)


That, for the purposes of any Act resulting from the Localism Bill, it is expedient to authorise—

(a) the making of provision in relation to income tax, corporation tax, capital gains tax, stamp duty, stamp duty land tax or stamp duty reserve tax in connection with a transfer of property, rights or liabilities by or under the Act; and

(b) the making of provision for a body not to be exempt from corporation tax, income tax or capital gains tax where in pursuance of the exercise of functions of the Greater London Authority the body carries on activities for a commercial purpose.—(Robert Neill.)

17 May 2011 : Column 195

Localism Bill (Programme) (No. 2)

5.49 pm

The Minister of State, Department for Communities and Local Government (Greg Clark): I beg to move,

That the Order of 17 January 2011 (Localism Bill (Programme)) be varied as follows:

1. Paragraphs 4 and 5 shall be omitted.

2. Proceedings on Consideration and Third Reading shall be completed in two days.

3. Proceedings on Consideration shall be taken on the days shown in the first column of the following Table and in the order so shown.

4. Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion at the times specified in the second column of the Table.



Time for conclusion of proceedings

First day


New Clauses relating to Part 1, new Schedules relating to Part 1, amendments to Clause 1, amendments to Schedule 1, amendments to Clauses 2 to 10, amendments to Schedule 2, amendments to Clause 11, amendments to Schedule 3, amendments to Clauses 12 to 14, amendments to Schedule 4, amendments to Clauses 15 to 29, new Clauses relating to Part 2, new Schedules relating to Part 2 and amendments to Clauses 30 to 34.

7.30 pm

New Clauses relating to Part 5, new Schedules relating to Part 5, amendments to Clause 89, amendments to Schedule 8, amendments to Clauses 90 to 96, amendments to Schedules 9 to 11, amendments to Clauses 97 to 101, amendments to Schedule 12, amendments to Clauses 102 to 107, amendments to Schedule 13, amendments to Clauses 108 to 120, new Clauses relating to Part 4, new Schedules relating to Part 4, amendments to Clauses 39 to 56, amendments to Schedules 5 and 6, amendments to Clauses 57 to 64, amendments to Schedule 7 and amendments to Clauses 65 to 88.

10.00 pm

Second day


New Clauses relating to Part 3, new Schedules relating to Part 3, amendments to Clauses 35 to 38, new Clauses relating to tax in connection with provisions of Parts 6 and 7, new Schedules relating to tax in connection with provisions of Parts 6 and 7, remaining new Clauses relating to Part 7, remaining new Schedules relating to Part 7, amendments to Clauses 157 to 166, amendments to Schedules 19 and 20, amendments to Clauses 167 to 169, amendments to Schedule 21, amendments to Clauses 170 to 193, amendments to Schedule 22, amendments to Clauses 194 and 195, amendments to Schedule 23 and amendments to Clauses 196 to 200.

4.00 pm

17 May 2011 : Column 196

Remaining new Clauses relating to Part 6, amendments to Clauses 121 to 133, amendments to Schedule 14,amendments to Clauses 134 to 140, amendments to Schedule 15, amendments to Clauses 141 to 150, amendments to Schedule 16, amendments to Clause 151, amendments to Schedule 17, amendments to Clauses 152 to 156, amendments to Schedule 18, remaining new Clauses, remaining new Schedules, amendments to Clauses 201 to 203, amendments to Schedule 24, amendments to Clauses 204 to 207 and remaining proceedings on Consideration.

6.00 pm

5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on the second day.

I will briefly introduce the motion. It is delightful to see that so many Committee members have come back for a second round. From the outset of our deliberations on the Bill, we said that we regarded the legislation as something that could benefit from the expertise that exists both within the House and outside.

We have been true to that statement, and we had a very interesting set of sessions in Committee: 24 sittings and 64 hours’ scrutiny. I probably spent more time during that period in the company of the hon. Member for Worsley and Eccles South (Barbara Keeley), at least during waking hours, than I did with my wife—although the hon. Member for Plymouth, Moor View (Alison Seabeck) sort of doubled up on that time. We considered every clause in the Bill and finished its scrutiny with a little time to spare, so we made good progress.

During the Bill’s passage, we established an atmosphere that was constructive, usually harmonious and often uproarious, even. I do not know whether the remaining stages will live up to the high benchmark that we set, but we should aim to take matters in the same spirit—I certainly intend to—today, tomorrow and, indeed, when the Bill goes to another place. This is a Bill in which there are invested the hopes and expectations of many people outside this place, and we owe it to them to reflect seriously on the matters that are before us and, where we can be constructive, to be so.

I hope Members will recognise that the large number of Government amendments is testimony to some of my commitments in Committee to reflect seriously on the points that were made and to come back to the House in a constructive way. There have been discussions across the House and with outside bodies in helping to shape that approach, and no doubt they will come out in our debates over the next two days.

It is comparatively unusual to have two days on Report, but the Bill’s significance and extent justify it. Nevertheless, I hope that the hon. Member for Worsley and Eccles South and her colleagues will accept that it is appropriate to insert a couple of knives into our proceedings so that we can get on to talk about planning and, in due course, housing. It would be remiss if we did not secure that outcome.

No doubt we will not agree on everything, and there may be cause for Divisions, but, as in Committee, constructive suggestions will have the opportunity to be reflected on and reflected in the Bill’s further progress in another place.

17 May 2011 : Column 197

5.53 pm

Barbara Keeley (Worsley and Eccles South) (Lab): I will be even more brief. As the Minister suggests, on Report the Government have tabled 234 new clauses and amendments, which is more than the number of clauses in the original Bill, so we have a lot to discuss. I would not say that we have two days. We have ended up with some concerns about the programming of these debates, but it would be more appropriate if we discussed them with the usual channels.

5.53 pm

Jonathan Edwards (Carmarthen East and Dinefwr) (PC): Looking at the proposed timetable, I note that parts 4 and 5 alone include 14 new clauses as well as Government and Opposition amendments, and there is no way in which considered debate can be held on all of them. As someone putting forward his own new clause, which is of huge importance to Wales, I am disappointed that insufficient time has been allocated on Report, and I call for extra time to ensure a considered debate about those vital issues.

Question put and agreed to.

17 May 2011 : Column 198

Localism Bill

[1st Allocated Day]

Consideration of Bill, as amended in the Public Bill Committee.

[ Relevant documents: The Second Report from the Communities and Local Government Committee, Abolition of Regional Spatial Strategies: a planning vacuum?, HC 517; Written evidence submitted to the Communities and Local Government Committee on the General Power of Competence, HC 931; The Third Report from the Environmental Audit Committee, Sustainable Development in the Localism Bill, HC 799. ]

New Clause 12

Limits on power under section 5(1)

‘(1) The Secretary of State may not make provision under section 5(1) unless the Secretary of State considers that the conditions in subsection (2), where relevant, are satisfied in relation to that provision.

(2) Those conditions are that—

(a) the effect of the provision is proportionate to the policy objective intended to be secured by the provision;

(b) the provision, taken as a whole, strikes a fair balance between the public interest and the interests of any person adversely affected by it;

(c) the provision does not remove any necessary protection;

(d) the provision does not prevent any person from continuing to exercise any right or freedom which that person might reasonably expect to continue to exercise;

(e) the provision is not of constitutional significance.

(3) An order under section 5(1) may not make provision for the delegation or transfer of any function of legislating.

(4) For the purposes of subsection (3) a “function of legislating” is a function of legislating by order, rules, regulations or other subordinate instrument.

(5) An order under section 5(1) may not make provision to abolish or vary any tax.’.—(Andrew Stunell.)

Brought up, and read the First time .

5.54 pm

The Parliamentary Under-Secretary of State for Communities and Local Government (Andrew Stunell): I beg to move, That the clause be read a Second time.

Mr Deputy Speaker (Mr Nigel Evans): With this it will be convenient to discuss the following:

New clause 8—Sunday trading hours - power to amend or repeal

‘Notwithstanding any existing statutory provisions, a local authority may, for its area, impose its own regulations on Sunday opening hours for retail outlets that currently have a restriction in place to either—

(a) reduce the existing hours, or

(b) extend the existing hours.’.

New clause 10—Recall elections

‘(1) If 25% or more of the registered voters in the constituency of an elected local government member sign a relevant recall petition then a recall election must be held on the same date as the next election (whether or not a local election) to be held in the constituency of the elected government member, provided that that election is not less than 12 weeks after the threshold has been reached.

(2) In order for a recall petition to be relevant the appropriate returning officer must be satisfied that—

17 May 2011 : Column 199

(a) the petition has been submitted in accordance with the rules provided for in subsection (3) and;

(b) there is evidence contained in the petition that the elected local government member has—

(i) acted in a way which is financially dishonest or disreputable,

(ii) intentionally misled the body to which he or she was elected,

(iii) broken any promises made by him or her in an election address,

(iv) behaved in a way that is likely to bring his or her office into disrepute, or

(v) lost the confidence of his or her electorate.

(3) The Secretary of State must lay regulations before Parliament within six months of the passing of this Act setting out—

(a) how notice of intent to petition for recall is to be given,

(b) how “registered voters” are to be defined for different types of constituency,

(c) the definition of “appropriate returning officer”,

(d) the ways in which registered voters can sign a recall petition,

(e) the ways in which signatures to such petitions will be verified,

(f) entitlement to vote in, and the conduct of, the recall election,

(g) rules on any other related matters as considered necessary by the Secretary of State, and

(h) consequential, saving, transitory or transitional provision (including amendments to existing statutory provision, whenever passed or made).

(4) The Secretary of State must issue guidance to returning officers on how to make assessments under subsection (2)(b) within six months of the passing of this Act.

(5) The question that is to appear on the ballot papers in a recall election is “Should [name of elected local government member] be recalled from [name of body or office]?”.

(6) If at a recall election more votes are cast in favour of the answer “Yes” than in favour of the answer “No”, then—

(a) if the elected representative has been elected under a first past the post or alternative vote electoral system, he or she is recalled and a by-election must be held within three months in which the recalled candidate may stand, or

(b) if the elected representative has been elected under a system of proportional representation, the next candidate on the relevant party list shall take the seat.

(7) In this section “elected local government member” means any person elected to the Greater London Authority, a county council in England, district council, or London borough council, including an elected mayor of the council; and the Mayor of London.

(8) Regulations under this section may not be made unless a draft of the statutory instrument containing the regulations has been laid before, and approved by a resolution of, each House of Parliament.

(9) Subsections (1) and (2) come into force six months after the day on which the regulations under subsection (3) are made.’.

New clause 27—Low pay policy statements

‘(1) The Secretary of State must by regulations made by statutory instrument require relevant authorities to prepare a pay policy statement for lower paid staff within six months of this Act coming into force.

(2) In this section “lower paid staff” means—

(a) the lowest paid member of staff, and

(b) any member of staff paid less than 20 per cent. above the amount paid to the lowest paid member of staff.’.

17 May 2011 : Column 200

New clause 28—Local authority contractor pay policy statements

‘(1) The Secretary of State must by regulations made by statutory instrument require relevant authorities to prepare a pay policy statement for the highest paid staff and the lower paid staff of local authority contractors within six months of this Act coming into force.

(2) In this section—

(a) “local authority contractors” means a company or organisation (a “contractor”) that supplies services or executes works for the relevant authorities to the value of more than £250,000 in any financial year;

(b) “lower paid staff” means—

(i) the lowest paid member of staff, and

(ii) any member of staff paid less than 20 per cent. above the amount paid to the lowest paid member of staff,

(c) “highest paid staff” means the highest paid member of staff by remuneration, which shall include payments made by the contractor to the member of staff in connection with that staff’s employment, any relevant bonuses and benefits in kind.’.

Amendment 37, page 4, line 22, clause 5, at end insert—

‘(6A) The power under subsection (1) or (2) may not be exercised to amend, repeal, revoke or disapply—

(a) this Part of this Act,

(b) Public Libraries and Museums Act 1964 section 7 or section 13,

(c) Small Holdings and Allotments Act 1908 section 23,

(d) Children Act 1989 Part 3 and Schedule 2,

(e) Childcare Act 2006, Parts 1 and 2,

(f) Child Poverty Act 2010 Part 2,

(g) Equality Act 2010, section 88,

(h) Equality Act 2010, section 149,

(i) Care Standards Act 2000,

(j) Chronically Sick and Disabled Persons Act 1970 section 21,

(k) Transport Act 2000 section 145A,

(l) Local Authorities’ Traffic Orders (Exemptions for Disabled Persons) (England) Regulations 2000,

(m) Disabled Persons (Badges for Motor Vehicles) (England) (Amendment) Regulations 2007,

(n) Disabled Persons (Badges for Motor Vehicles) (England) (Amendment No. 2) Regulations 2007,

(o) Carers and Disabled Children Act 2000,

(p) Carers (Recognition and Services) Act 1995,

(q) Disabled Persons (Services, Consultation and Representation) Act 1986,

(r) Mental Health Act 1983 Part 8,

(s) Community Care, Services for Carers and Children Services (Direct Payments) England Regulations 2009,

(t) Public Health Act 1875,

(u) Public Health Act 1936,

(v) Commons Act 2006,

(w) Countryside and Rights of Way Act 2000,

(x) Natural Environment and Rural Communities Act 2006 section 40,

(y) Wildlife and Countryside Act 1981 section 25 or section 28E,

(z) Environment Act 1995 Part 4,

(z1) Dangerous Wild Animals Act 1976,

(z2) Prevention of Damage by Pests Act 1949,

(z3) Hedgerow Regulations 1997,

(z4) Planning (Listed Building and Conservation Areas) Act 1990 section 66 or section 72,

17 May 2011 : Column 201

(z5) Ancient Monument and Archaeological Areas Act 1979 sections 12 and 13,

(z6) National Parks and Access to the Countryside Act 1949,

(z7) Animal Welfare Act 2006 section 30,

(z8) Zoo Licensing Act 1981,

(z9) Marine and Coastal Access Act 2009 Part 6,

(z10) Flood and Water Management Act 2010 Schedule 3,

(z11) Working Time Regulations 1998 Regulation 28,

(z12) Education Act 1996 section 15ZA,

(z13) Food Safety Act 1990 Parts 1, 2 and 3,

(z14) Freedom of Information Act 2000,

(z15) Housing Grants, Construction and Regeneration Act 1996 section 1,

(z16) Housing Act 1996 Part 7,

(z17) Homelessness Act 2002,

(z18) Housing Act 2004 Part 2,

(z19) Local Government Act 1972 Part VA, section 99 or section 148,

(z20) Local Government Act 2000 Part 3 section 21 or section 37,

(z21) Children and Young Persons Act 1969 Part 1, or

(z22) Adoption and Children Act 2002.’.

Government amendments 44 to 50.

Amendment 36, page 5, line 32, clause 7, at end insert—

‘subject to the exceptions specified in section 5 (6A)’.

Government amendments 51 to 98.

Amendment 42, page 193, line 27, schedule 2, leave out from beginning to end of line 39 on page 195.

Amendment 43, page 198, leave out lines 4 to 25.

Amendment 2, page 199, leave out lines 30 to 43 and insert—

‘The elected mayor is to be returned under the simple majority system.’.

Amendment 3, page 200, line 6, leave out from ‘one’ to second ‘vote’ in line 7.

Amendment 38, page 205, leave out lines 29 to 31.

Amendment 1, page 208, line 48, leave out ‘5’ and insert ‘2.5’.

Amendment 39, page 209, leave out lines 3 to 25.

Amendment 40, page 209, leave out lines 26 to 47.

Amendment 41, page 211, line 18, leave out from beginning to end of line 31 on page 213.

Amendment 15, page 213, line 40, at end insert—

‘9OZA Elected Mayors and Reduction of Councillors

(1) Where a local authority has an elected mayor, that local authority must reduce within four years of the election of the Mayor the number of local councillors to one-third of pre-mayoral levels.

(2) These provisions will apply retrospectively to local authorities which already have an elected mayor and the reduction in councillors must take place within four years of this legislation taking effect.’.

Amendment 4, page 215, leave out line 17.

Amendment 5, page 215, leave out lines 34 and 35.

Government amendments 99 to 129.

Amendment 365, page 15, line 44, clause 16, leave out ‘may’ and insert ‘must’.

Amendment 366, page 16, line 4, leave out paragraph (c).

Government amendments 130 and 131.

17 May 2011 : Column 202

Amendment 367, page 16, line 31, clause 17, leave out ‘may’ and insert ‘must’.

Amendment 302, page 18, line 28, clause 21, leave out ‘senior’.

Amendment 303, page 18, line 30, leave out ‘A senior’ and insert ‘Subject to subsection (2)(b), a,’.

Amendment 304, page 18, line 31, leave out ‘its chief officers’ and insert—

‘(a) its chief officers and its lower paid staff; and

(b) the chief officers and the lower paid staff for each employer of indirectly employed staff, subject to paragraph (c);

(c) nothing in this Chapter shall be taken as requiring the publication of a pay policy statement where:

(i) it relates to indirectly employed staff; and

(ii) the aggregate value of all funding received by the indirect employer of the staff from a relevant authority does not exceed £250,00 in any financial year.’.

Amendment 305, page 18, line 41, at end insert

‘and the lower paid staff

(h) the total level of remuneration of the highest paid chief officer (A);

(i) the total level of remuneration of the lowest paid member of staff (B);

(j) the total number of staff being paid the amount set out in paragraph (3)(i);

(k) the number of staff paid less than 10 per cent. above the amount set out in paragraph (3)(i);

(l) the number of staff paid less than 20 per cent. above the amount set out in paragraph (3)(i);

(m) the highest paid chief officer’s remuneration as a multiple of the lowest paid member of staff’s remuneration using the formulation A/B;

(n) the pay multiple to be maintained as set out in paragraph (3)(m).’.

Amendment 306, page 19, line 1, leave out ‘senior’.

Amendment 307, page 19, line 3, at end insert ‘and lower paid staff’.

Amendment 308, page 19, line 5, leave out ‘senior’.

Amendment 309, page 19, line 11, leave out ‘senior’.

Amendment 310, page 19, line 13, leave out ‘senior’.

Amendment 311, page 19, line 16, at end insert—

‘(6) Where any of the posts to be included in the pay policy statement are not full-time, the information given in the pay policy statement must be expressed as a full-time equivalent.’.

Amendment 312, page 19, line 29, clause 24, at end insert—

‘or its lower paid staff.’.

Amendment 313, page 19, line 30, leave out ‘senior’.

Amendment 373, page 19, line 39, leave out ‘senior’.

Amendment 314, page 20, line 35, clause 26, at end insert—

‘(g) any employee of the relevant authority whose remuneration exceeds that of any chief officer as defined in this section.’.

Amendment 315, page 20, line 35, at end insert—

‘(2A) In this Chapter “lower paid staff’, means each of the following—

(a) the lowest paid member of staff,

(b) staff paid less than 20 per cent. above the amount paid to the lowest paid member of staff.

17 May 2011 : Column 203

(2B) In this Chapter “staff” means any staff whether directly or indirectly employed by a relevant authority and who are not chief officers.

(2C) In this Chapter “indirectly employed” means staff employed other than by a relevant authority to undertake work for a relevant authority and which is funded by that authority. Any reference to indirect employment, indirect employer or indirectly employed staff, shall be construed accordingly.

(2D) In this Chapter the provisions of section 231 (associated employers) of the Employment Rights Act 1996 shall apply to indirect employment arrangements.’.

Amendment 316, page 20, line 36, after ‘officer’, insert—

‘, or lowest paid member of staff’.

Amendment 317, page 20, line 38, after ‘officer’s’, insert—

‘, or lowest paid member of staff’s’.

Amendment 318, page 20, line 40, after ‘officer’, insert—

‘, or lowest paid member of staff’.

Amendment 319, page 20, line 41, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 320, page 20, line 43, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 283, page 20, line 44, leave out ‘is’ and insert—

‘or lowest paid member of staff is’.

Amendment 284, page 20, line 45, after ‘officer’s’, insert—

‘or lowest paid member of staff’s’.

Amendment 285, page 21, line 1, after ‘officer’s’, insert—

‘or lowest paid member of staff’s’.

Amendment 286, page 21, line 4, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 287, page 21, line 5, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 288, page 21, line 7, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 289, page 21, line 8, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 290, page 21, line 11, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 291, page 21, line 13, after ‘officer’, insert—

‘or lowest paid member of staff’.

Amendment 292, page 21, line 15, after ‘officers’, insert—

‘or lowest paid members of staff’.

Government new clause 13—Further warning notices.

Government new clause 14—Further EU financial sanction notices.

Amendment 353, page 22, line 1, leave out clause 30.

Government amendments 132 and 133.

Amendment 354, page 22, line 28, leave out clause 31.

Government amendments 134 and 135.

Amendment 355, page 23, line 41, leave out clause 32.

17 May 2011 : Column 204

Government amendments 136 to 138.

Amendment 356, page 24, line 23, leave out clause 33.

Government amendments 139 and 140.

Amendment 357, page 24, line 38, leave out clause 34.

Government amendments 141 to 143, 183, 211, 216 and 217.

Government new clause 22—Pre-commencement consultation.

Government amendment 266.

Andrew Stunell: New clause 12 refines one of the central elements of the Bill—the general power of competence. I shall say more about that shortly and also address the other new clauses and amendments in this excessively long group.

The Government are committed to the radical decentralisation of power and control from Whitehall and Westminster to local government, local communities and individuals. We are pushing power back down to the lowest possible level, and this Bill is about shaking up the balance of power and revitalising democracy. It will give power to councils, communities, voluntary groups and the people, giving local authorities the power to take decisions that are right for their areas, and giving to local people the power to influence those decisions.

This Government trust local authorities to know what is best for their areas, we trust local councillors to know what they are doing and we are freeing up local government from the shackles of central Government. The Localism Bill does just what it says on the label.

Philip Davies (Shipley) (Con): I welcome the Minister’s opening remarks and wonder whether he is, therefore, just about to get on to the fact that he supports my new clause 8, which would give local authorities the opportunity to vary Sunday trading laws. If what he says is true and he wants to pass all such decisions down to the lowest possible level, that is surely what he is about to announce.

Andrew Stunell: I look forward to hearing my hon. Friend’s case deployed in the debate.

I am pleased to report that there is a very broad measure of agreement, both inside and outside the House, on the Bill’s principles and, indeed, on many of its specific provisions.

Local authorities will need to ensure the delivery of more responsive services in a more transparent way, so that their citizens can see what is going on. To do so, local councils will need to innovate, to work across traditional boundaries and to ensure clear lines of accountability to their residents. That will be characterised, above all, by the way in which local democracy is renewed.

Within this very large group of proposed changes, there are a number of new clauses and amendments that hon. Members from all parts of the House have tabled, including the one to which my hon. Friend just referred. We shall debate them, I will consider carefully the points that hon. Members raise and I hope to have the opportunity to respond to them before the close of this debate.

17 May 2011 : Column 205

We had a consensual time on the whole in Committee, and I hope that we can carry that forward in our discussion on this group of proposed changes.

Barbara Keeley (Worsley and Eccles South) (Lab): Not wanting to become non-consensual at this early stage, I note that the Minister talks about limits on power, and we are still concerned about the Bill’s 142 extra powers for the Secretary of State. I am puzzled why new clause 12 specifies only the powers in clause 5(1), because they are exactly the same as those in clause 5(2). If there is a concern about limiting the powers of the Secretary of State, it should apply to both subsections. I wonder whether the Minister might cover that point.

Andrew Stunell: I hope to have satisfied the hon. Lady by the time I have completed my remarks. If not, I am sure that she will let me know.

All the Government amendments and new clauses, one way or another, are designed to improve the effectiveness of the Bill, given the range of issues that were raised in Committee, as the Minister of State said, and given outside events, including in particular the passage of the Welsh referendum, which means that some of the provisions that were in prospect earlier on can now be made a reality. To that extent, I hope I can reassure the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) that we are not inserting a whole lot of totally new provisions; we are simply making available to the Welsh Executive the same powers that are being made available in England. I hope he finds that somewhat reassuring.

We have, where appropriate, taken into account feedback from the consultations that have been carried out on elements of the Bill and representations that we have received from a wide range of organisations that have been interested in—and, in some cases, very excited about—the prospect of the Bill coming into force.

6 pm

There was a broad consensus about the general power of competence, with the concerns that were expressed being about the scope of the powers and the role of the Secretary of State. New clause 12 and the related amendments address those points. Equally, there were debates and discussions about the position of fire and rescue authorities, because they will have similar powers. We have reflected on the concerns raised in Committee and the feedback that we received from industry partners, and we have tabled an amendment on that point. Several amendments make the fire and rescue authority powers applicable in Wales.

There was much agreement in the Committee’s debate on the Standards Board for England, and we listened carefully and have tabled an amendment. On European Union fines, there was a lot of discussion about the practicalities, but we reached a position whereby people agreed that the intentions behind our proposals on EU infractions were broadly reasonable—I think those were the words of the right hon. Member for Greenwich and Woolwich (Mr Raynsford)—and the debate was more about how this would work in practice.

Barbara Keeley: This is the point where we have to become non-consensual, because Labour Members are still totally opposed to EU fines, and amendments have been tabled on that.

17 May 2011 : Column 206

Andrew Stunell: I take note of that, and I will return to it in two or three minutes’ time, if I may.

The hon. Lady is of course right that there was not agreement on everything. I recognise, in particular, that there were different views on mayors, not only between Government and Opposition Front-Bench teams but among some of my hon. Friends. I will listen carefully to the points made today on the mayoral proposals in the Bill, particularly on such issues as shadow mayors and mayoral management arrangements. Overall, however, I was struck by how much we had in common and how much consensus there is about the need to change the power balance in this country in line with the direction that the Bill takes. I hope that the House will recognise that, through the range of new clauses and amendments that we have tabled, we have tried genuinely and thoroughly to address the points that have been raised.

Let me turn in more detail to new clause 12 and some of the other Government amendments. I appreciate that I have to strike a difficult balance between using up the available time for debate and giving the House a reasonable explanation of the measures before it. I will steer as good a course as I can, Mr Deputy Speaker, but I am sure you will let me know if I go astray. New clause 12 and its related amendments impose conditions on the use of the delegated powers in clause 5(1) in relation to the general power of competence. Clause 5(1) sets out a power for the Secretary of State to remove or to change statutory provisions that prevent or restrict the use of the general power of competence. We have termed this the barrier-buster power.

Amendment 64 is the equivalent provision for the general power of competence for fire and rescue authorities in England and Wales. The amendment imposes conditions on the use of the delegated powers in new section 5C(1) of the Fire and Rescue Services Act 2004, which is inserted by clause 8. New section 5C(1) sets out a power for the appropriate national authority—Welsh Ministers for the devolved matters relating to Wales, but otherwise the Secretary of State—to remove or to change statutory provisions that prevent or restrict the use of the general power for fire and rescue authorities.

Concerns were expressed about the scope of the delegated power at clause 5(1)—the barrier buster—and the equivalent powers in relation to fire and rescue authorities. The Government reflected on those concerns and decided to introduce specific preconditions as to the use of the barrier-buster power and the limitations on its scope. These include a proportionality test and a requirement to achieve a fair balance between the public interest and the interests of any person adversely affected by an order. In addition to the current requirements that the Secretary of State has to satisfy—in particular, that he must think that a provision prevents or restricts the use of the general power and must consult on his proposals—subsection (1) now provides that he must also consider the conditions set out in subsection (2), in relation to the general power, and in section 5C(1) in relation to the fire provision to have been satisfied in relation to the proposals.

The new conditions that the clause introduces ensure that the use of the provision is proportionate to the policy objective intended, that there is a fair balance between the public interest and the interests of any person adversely affected, that there is no removal of any necessary protection, that no person will be prevented

17 May 2011 : Column 207

from continuing to exercise any right or freedom that they might reasonably expect to exercise, and that any provision is not of constitutional significance. In the light of Opposition amendments 36 and 37, it is perhaps worth explaining the effect of these conditions in a little more detail. The first condition is that the effect of the provision made by the order is proportionate to its policy objective. It might be possible to achieve a policy objective in several different ways, some of which might be more onerous than others and could represent a disproportionate means of securing the desired outcome, so the Secretary of State must satisfy himself that that is not the case and that there is an appropriate relationship between the policy aim and the means chosen to deliver it.

The second condition is that the provision made by the order, taken as a whole, strikes a fair balance between the public interest, on the one hand, and the interests of the person adversely affected by the order, on the other. While it may be possible to make an order that will have an adverse effect on the interests of one or more persons, the Secretary of State must first be satisfied that this is outweighed by beneficial effects in the public interest. The third condition is that the provision made by the order does not remove any necessary protection. The notion of necessary protection can extend to economic protection, to health and safety protection, and to the protection of civil liberties, the environment and national heritage.

The fourth condition is that the provision made by the order will not prevent any person from continuing to exercise any right or freedom that he might reasonably expect to continue to exercise. To take a leading example, any right conferred or protected by the European convention on human rights is a right that a person might reasonably expect to keep. The fifth and final condition is that the provision made by the order is not constitutionally significant. That condition will allow orders to amend enactments that are themselves constitutionally significant, but only if the amendments are not constitutionally significant. The condition puts it beyond doubt that repeal of legislation such as the Human Rights Act 1998 or the European Communities Act 1972 is outside this power.

In addition to these preconditions, we are seeking to amend the Bill so that an order under clause 5(1) or section 5C(1) of the 2004 Act may not make provision in relation to certain specified limitation. Subsection (3) prevents orders from being used to delegate or transfer a function of legislating, ensuring that a power to make legislation given by Parliament to the Secretary of State or to another body cannot be transferred to a local authority in the interests of barrier busting. It is right that those decisions should remain with Parliament. Subsection (4) gives a definition of the function of legislating—that is, legislating by order, by rules, by regulation or by subordinate instruments. Subsection (5) prohibits an order from abolishing or varying any tax. It could be argued that removing a tax payable by a local authority would be the removal of a barrier, but it is not our intention that clause 5(1) should be used in that way, so the new clause will prevent an order to vary tax from being made.

Taken as a whole, the Government’s proposals will provide the protections that the Opposition seek in amendments 36 and 37, but without the inflexible and heavy-handed mechanism that they propose.

17 May 2011 : Column 208

Amendment 36 would amend the definition of a statutory provision by excluding from that definition a long list of statutes, which is set out in amendment 37. That appears to have been prompted by various strands of work that are being undertaken to gather information about local authority duties. This appears to be an attempt to make a point about front-line duties and the desirability of many things that local authorities have to do. Indeed, that is what the hon. Member for Worsley and Eccles South (Barbara Keeley) set out on her website as being her intention. She has fairly given me notice that she

“will be pressing ministers in the Commons debate…to be clear about which other vital council services can be protected.”

I am happy to tell the hon. Lady that the general power is not designed as a means to do away with duties that Parliament has imposed on local authorities. The general power does not oblige local authorities to act in a particular way; it is not the same thing as a duty imposed by legislation. It will give local authorities real freedom to innovate and act in the interests of their communities. The Opposition seem to have developed a misunderstanding about the scope of clause 5(1). It provides the Secretary of State with powers to remove or change statutory provisions that prevent or restrict the use of the general power. That restriction or limitation is one that bites on the general power by virtue of clause 2. The provision is about removing barriers to the legal capacity of authorities to act innovatively and in the best interests of their communities. It is not aimed at removing duties, nor is it, nor could it be, a general-purpose tool to remove any legislation that places a burden on local authorities.

New clause 12 and the connected Government amendments will increase the safeguards on the use of the power in clause 5(1). In addition, the Secretary of State must consult before exercising the power and the appropriate parliamentary procedure for scrutinising any proposed order will be determined by Parliament.

Heidi Alexander (Lewisham East) (Lab): Does the Minister accept that clause 5, when taken in conjunction with the review that his Department is carrying out into burdensome regulations, might lead to the fear, which many of my constituents have expressed to me, that important protections and duties that exist within local authorities might disappear?

Andrew Stunell: The review of statutory duties is a separate exercise. We have made it clear several times that the review of statutory duties will not remove duties to provide vital services, and that any changes to statutory duties that come about as a result of that review will subsequently be properly considered and consulted on. There is no connection between the two processes.

I urge the House, when the time comes, to support new clause 12 and to reject amendments 36 and 37.

I will turn to the other proposals in this group, on which I hope I can be helpful. When the Committee discussed the standards of behaviour required of councillors, we discussed whether a local authority should have to publicise that it has a code of conduct. My hon. Friend the Member for Bradford East (Mr Ward) made a powerful speech on the difference between may and must. I think that was one of the Committee’s high spots. Although we consider it right that a local authority

17 May 2011 : Column 209

can choose whether to adopt a code of conduct for its members, it must be under a duty to disclose whether it has done so and whether it has revised or abolished its code. That duty will ensure that local people are made aware when their local authority adopts, changes or withdraws its code, while leaving it for authorities to decide how best to publicise and deal with these matters.

6.15 pm

Mr Nick Raynsford (Greenwich and Woolwich) (Lab): The Minister is putting the completely absurd proposition to the House that the local authority will be under a duty to publicise a code of conduct that it may decide not to have. Will he please recognise that that is nonsense? Abolishing the requirement for a code of conduct in every local authority in the country is a serious, retrograde step, of which the Government should be profoundly ashamed.

Andrew Stunell: The right hon. Gentleman asked me a question and the answer is no, I do not accept that at all. When we exchanged words in Committee, I thought that this was an outrage, so I am glad that it has been downgraded a little. The important point is that the decision a local authority takes should be transparent, so that the local electorate are aware of it and the local authority are accountable to them. We have accepted the point that my hon. Friend the Member for Bradford East put to the Committee, and Government amendments 130 and 131 deal with that.

Oliver Heald (North East Hertfordshire) (Con): Does the Minister expect to give any guidance under the powers in the Bill on what a code of conduct might contain, or will it simply be left to the local authority to do its best?

Andrew Stunell: The Local Government Association has given notice that it sees itself as—I do not want to put words into its mouth and say the custodian—the focal point for ensuring that a standard code of practice is available. I would have thought that the huge majority of local authorities will continue to have a published and open code of conduct. Indeed, I should have thought that it would reflect adversely on the reputation of a local authority if it chose not to do so. However, the right place for that decision to be taken is in that local authority in the light of the views of its electorate; it is not something that should be imposed from above.

Jim Shannon (Strangford) (DUP): In Northern Ireland, we have a stringent code of conduct for local authorities. Has the Minister had any discussions with local authorities in Northern Ireland on using that blueprint for a code of conduct under these proposals?

Andrew Stunell: I am sure that the hon. Gentleman is aware that the Bill is not applicable in Northern Ireland. Currently, every local authority in England has to have a statutory code of conduct, so we are not for want of an example. We are saying that there should be flexibility about the shape and nature of the code, and that that flexibility should be exercised by the local authority.

17 May 2011 : Column 210

On EU fines and infractions, I assure the House and the hon. Member for Worsley and Eccles South that we will ensure that any process to pass on an EU fine is fair, reasonable and proportionate, and we will consult on that. We will pass on a fine only if an authority has clearly caused or contributed to causing it, and has the power to remedy the situation and can afford to pay. That is set out in new clauses 13 and 14 and in Government amendments 132 to 143. The measure is not about Ministers reclaiming every penny; it is about giving a strong encouragement not to incur fines in the first place. Local authorities must not be able to assume that if they make a mistake and are in the wrong, the UK taxpayer will pay their bill for them.

It is perhaps worth rehearsing what the process is. EU grants are given with conditions attached. At present, the monitoring, and therefore the risk, falls to central Government and their agencies. In the new, devolved world, that will not always be the case, and with the transfer of control has to come a transfer of risk. The Government do not seek to offload risks that are beyond a local authority’s control—mention has been made of air pollution targets and so on.

That will all be set out in a policy statement, and I can say today that we are making good progress on that. I am placing in the Library a paper from the Greater London authority that has emerged from some of our earlier discussions, and I would very much welcome comments on it. We do not necessarily agree with every single part of it, but it will provide a strong basis for discussion over the next few weeks and we are committed to taking that discussion forward. We have also engaged with the Local Government Association and will continue to do so.

We debated fire and rescue authorities in Committee, and our amendments 92 and 93 are a response to the concerns that the Opposition raised and feedback that we have received from industry partners. They relate to authorities’ powers to charge for attending persistently malfunctioning or wrongly installed automatic fire alarms. It is not in dispute that there should be such a provision for non-domestic premises, but the point was made that domestic premises would also be caught by that power, and probably wrongly so. The amendments simply remove that option from fire and rescue authorities.

We also discussed pay accountability in Committee, and we undertook to return to the House on the matter of greater accountability on low pay in light of Will Hutton’s report on fair pay in the public sector. His report made some clear recommendations, particularly about the benefit of setting decisions on senior pay in the context of the pay of the rest of a body’s work force. Some of the Opposition’s amendments are in the same tone. We are sympathetic to that idea, particularly the potential for linking lower pay with senior pay, and we will consider the best way to take that forward. If necessary, we will return to it in the other place. As we do so, we will remain mindful of the level of burden placed on authorities and ensure that pay decisions remain ones for the appropriate local employer to take and are not dictated by us.

On the other hand, we do not think it would be helpful to use the Bill to address the pay of contracting bodies. Councils, the voluntary sector and businesses, especially small firms, have called on the Government to remove unnecessary burdens and break down barriers

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in local authority contracting, not increase them. That does not prevent a local authority from developing a local policy to ensure that bodies with which it contracts are open about their rates of pay as a matter of contract. That should remain an issue for local decision making, not central determination.

We have a very large group of amendments, and you no doubt have a large group of Members wishing to speak, Mr Deputy Speaker. I apologise to the House on the one hand for taking so long and on the other for dealing with some very important topics only in skeleton form. I am pleased to move new clause 12, and in due time I will wish to move the other Government new clauses and amendments in the group. I undertake to listen carefully to Members’ contributions as the debate proceeds.

Barbara Keeley: I am glad that Ministers are still so interested in my website—it makes it worth all the effort of keeping it up to date.

I shall speak first to amendments 36 and 37, which are related to new clause 12. They are intended to protect a list of the most important duties of local councils from the powers that the Secretary of State wants to take in clause 5(1) and (2). I should remind the Minister that he did not answer my question about new clause 12 not applying to clause 5(2). I see that Ministers are looking at the Box and seeing if they can find some inspiration over there.

As I said on Second Reading, the Secretary of State’s power under clause 5(1) and (2) is chilling, because it would allow him to

“amend, repeal, revoke or disapply”

any statutory provision. The Government can keep calling that barrier-busting, but it will still end up being the same swingeing power. The difficulty for those who are opposed to it is that it would leave local councils and the people who use their services at the mercy of the ideology of the current Government and Secretary of State. I know from the debates that we had in Committee that some of the Ministers were opposed to giving Secretaries of State such a level of power in previous local government Bills, and spoke against it. Perhaps they would like to think about why they have had such a change of heart.

Since our debates on the Bill started, the Department has launched its review of the statutory duties of local councils. That means that the nature of the power in question, and how it will be used to sweep away what councils are starting to see as burdens, is now much more under the spotlight. The Government’s focus on duties as “burdens” has caused alarm and great concern to people who rely on the services of their local council. Their concern about the extent of the Secretary of State’s powers to sweep away councils’ duties is greater because of the language that the Government are using to describe the vital duties on which people depend. In the review, councils and the public were asked to specify the bureaucratic burdens that they wished to throw away. In fact, Ministers have allowed all the duties of councils to be listed, and voted on, as “burdens”, “red tape” or “bureaucratic barriers”. In using that language, they do not appear to have considered the importance of many of the statutory duties of local councils.

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Strangely, we now find ourselves bartering to try to find out which particular duties might be safe and protected from the Secretary of State. The Department’s website states that the only duties that might be protected are those on libraries and child protection, but the Under-Secretary of State, the hon. Member for Bromley and Chislehurst (Robert Neill), ventured in a recent letter to The Guardian that allotments were also safe. It is not reasonable to have only vague reassurances on three out of all the duties of local councils. We have therefore tabled amendments 36 and 37, and I say to Ministers that they must be clearer about protecting the vital duties of local councils—duties that legislation has created, which provide important protections and services on which people rely—from the power that the Secretary of State wants to

“amend, repeal, revoke or disapply”

any statutory provision.

Members should make no mistake about it: there are real concerns about that power. Professor Luke Clements is a leading expert on community care law, and in an article about the statutory provisions that could be swept away by the new power, he stated:

“The list includes large swathes of the Mental Health Act 1983, the Children Act 1989 as well as virtually every community care and carers statute. The suggestion that protecting children or frail elderly people from abuse could be…‘burdensome’ is further evidence of the coalition government’s disdain for the very notion of a welfare state.”

He said of the Government’s approach:

“It is a contempt that has already created a largely lawless regime where fundamental rights, such as the right to a face-to-face assessment”


“the right to have assessed needs met regardless of resources…are openly flouted. It is a regime that fuels the daily news stories of disabled, elderly and ill people being failed by public bodies, and experiencing neglect and extreme indignity. In the face of this, the response of the coalition government is not to strengthen the law, but to suggest that it be trashed.”

Andrew Stunell: I have really been disappointed by the hon. Lady’s remarks, which are a travesty of what is in prospect. I spent perhaps a little too long in my speech explaining precisely what new clause 12 will do and making it absolutely clear what it will not do. I am sorry to say that she is making it up, which is not good.

Incidentally, I can answer the hon. Lady’s question about clause 5(2)—as she suggested, inspiration has arrived. It relates only to overlapping powers, so by definition it will not change local authority powers or duties because it will take away only one of the overlapping powers.

6.30 pm

Barbara Keeley: I am afraid that I am not convinced by that, and I am not making this up. I know Professor Clements, because he helped to draft much of the carers legislation that went through the House as private Members’ Bills. He, among others, is very concerned.

To respond to the Minister’s point, part of the difficulty is that the conditions set out in Government new clause 12(2) are subjective. It is another lawyers’ charter, because they will have to settle the question of whether or not legislation fits those conditions. The key point is that all the decisions lie completely within the judgment of the Secretary of State. That is what is making people

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uncomfortable. There is great concern about sweeping away the laws, rights and protections for those who need care. Yesterday in the Palace, I attended a gathering of five all-party groups on disability—I attended as the chair of the all-party group on social care. Two questions were asked of the Bill and the review, and there was a chorus of concern in the room. Ministers can attack me if they want to, but I am representing concern from outside the House.

Citizens Advice has told MPs that it is worried about the broad-ranging powers that clause 5 confers on the Secretary of State. It is worried that the power will be used to revoke or repeal a number of statutory provisions, such as the public sector equalities duty.

Yasmin Qureshi (Bolton South East) (Lab): The Prime Minister says that he wants power to be given back to local people. Does my hon. Friend agree that giving the Secretary of State 126 new powers contradicts that?

Barbara Keeley: That is a contradiction. In fact, the 126 or 142 new powers—we can count them in different ways—are of great concern.

The list of legislation that we propose in amendment 37 for protection from those new powers may not be perfect—I am sure people can find fault with it—but it is vital to get a clear steer from Ministers that they do not intend to continue to see important council duties as burdens. Does the Secretary of State agree that the Homelessness Act 2002, which is on our proposed list, creates a vital duty for councils to have a strategy for tackling homelessness, or does he agree with Hammersmith and Fulham council, which has asked for that duty to be scrapped? Hammersmith and Fulham also wants to scrap the rough sleeper strategy, and wants not to assess the sufficiency of locally available child care. It wants no requirements on its youth service. Do Ministers believe that Hammersmith and Fulham should be able to shed those duties? That is the key question.

Councils such as Hammersmith and Fulham want to shake off what they view as burdensome duties, but the Opposition’s view is that those council services are vital and should be protected. A list of what is vital and to be protected is the key to that. In Committee, the Minister said:

“Every local authority will retain duties enshrined in other legislation to provide services and not to charge for them, if charging is not allowed at present.”––[Official Report, Localism Public Bill Committee, 1 February 2011; c. 184.]

However, Hammersmith and Fulham wants not to have plans for homeless people, and Wandsworth council plans to charge children £2.50 to use a playground. That is where we are. It is time for Ministers to end the uncertainty that they have generated with their sloppy plans for revising legislation on council duties. It is time for them to reintroduce certainty, so that people know that councils must provide land for allotments and an efficient library service, assess carers’ needs, and have plans for tackling homelessness.

I welcome the Minister’s partial sympathy on proposed new clauses 27 and 28 and the proposed amendments on pay transparency and very much look forward to developments. Much has been said in recent months on top pay in local government. I am sure that Ministers

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would agree that a great deal of that talk has been stoked by the Secretary of State for Communities and Local Government. However, he has tended not to show the same concern for the lowest paid staff, or for levels of pay among consultants and contractors, who provide £38 billion-worth of goods and services to local government, which is paid for out of the public purse.

Our proposals aim to introduce pay transparency much more fully than the Government plan. We want to shine a light on top pay and low pay, and I welcome the Minister’s sympathy for that. However, the Opposition also want to develop the recommendations in the Hutton review on pay. Ministers said that they would reflect on that review, and I hope they take that seriously. All hon. Members agree that there has been some excessive growth in senior roles in the public sector, but there are also myths about public sector pay. The Local Government Association estimates that of 1.7 million employees in mainstream local government jobs, 60% earn less than £18,000 a year. According to the LGA, more than 400,000 council workers earn less than the living wage, including more than 250,000 who earn less than £6.50 an hour.

Kelvin Hopkins (Luton North) (Lab): My hon. Friend makes a strong point. As a former Unison trade union officer, I know that a high proportion of those low-paid workers—a big majority—are women.

Barbara Keeley: Indeed, a quarter of those who experience in-work poverty are employed by the public sector. In addition, the average public sector pension, at £4,200, is very far from the gold-plated pension that people talk about. Our proposals would introduce greater transparency and help the objective of curbing excessive pay at the top of the scale, because it will be harder for a highly paid council chief executive to defend his or her pay if the public can see what that council pays its lowest-paid members of staff.

The Opposition believe that as well as an approach on top and low pay, we need a fair and consistent approach to transparency in local authority pay. As my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) said in Committee, Will Hutton’s report puts paid to the myths. Public sector employees earn only £1 of every £100 earned by the top 1%, or to put it another way, out of every £100 that is earned by the top 1%, only £1 is earned in the public sector. Therefore, the perception that the public sector is awash with fat cats is a myth, and it does not help when DCLG Ministers spend their time building that myth as a way of dealing with top pay.

The Hutton report confirms that increases in executive pay have been a private sector phenomenon. That is why tackling excess pay should happen not just in the public sector. We should also focus on pay in the private sector when money is paid from the public purse—that is the test. Staff on outsourced local government contracts tend to be concentrated in low-wage sectors such as cleaning, catering, low-skilled manual work and care work. One key question for hon. Members is this: do we want cleaners, care workers and teaching assistants to earn a living wage? The Opposition believe that they should earn such a wage. We therefore hope that Ministers and Government Members agree that the implementation of a senior pay policy in local government would be a double standard if the same logic is not applied to contractors, not least because the local government procurement market is valued at £38 billion.