Embedding sustainable development across Government, after the Secretary of State’s announcement on the future of the Sustainable Development Commission

Further written evidence submitted by the Sustainable Development Commission (ESD 23b)

Preparation for Secretary of State for Environment session

This note covers four topics:

1. The policy risks due to the cuts

2. Statutory obligations for SD

3. Performance Management Frameworks

4. Bureaucratic vs. democratic accountability

Section 1 – Policy Risks

EAC Question: What evidence is there that new policy decisions and government cuts are being made with consideration given to sustainable development?

In its announcement of its Comprehensive Spending Review [1] the Government states it has been "guided by the principles of freedom, fairness and responsibility" and has "prioritised:

· spending that promotes long-term growth, and creating the conditions for a private sector-led recovery and

· fairness, with all sections of society contributing to tacking the deficit, whilst protecting the most vulnerable and providing opportunity for the poorest.

This is underpinned by a radical programme of public service reform, improving transparency and accountability, giving more power and responsibility to citizens and enabling sustainable long term improvements in services".

In the Spending Review Framework [2] the Treasury states that it will" look beyond near-term pressures to support reforms that better position the UK for meeting long-term demographic, economic, environmental and social challenges, any of which could imperil long-term fiscal stability if left unaddressed".

The Government has said in developing the CSR it has consulted widely with experts and the wider public, to get their ideas and has been supported by an Independent Challenge Group of Civil Service leaders and external experts, to bring independent challenge to the Spending Review process. Their remit was to "think innovatively about the options for reducing public expenditure and balancing priorities to minimise the impact on public services". There is one member with sustainable procurement expertise.

With a focus on the long-term and on fairness and with an approach that looks at economic, environmental and social challenges, the Government has appears to have taken some SD principles into account in its overall approach to the CSR. However, we have not seen any evidence that the new policy decisions or proposals or the overall package set out in the Comprehensive Spending Review have taken a systematic approach respecting all five principles of SD, in particular environmental limits.

Similarly whilst many, if not all, of the Government’s policy aims might contribute to sustainable development, these aims need to be tackled with respect to each other, as a package of measures, to ensure there is not conflict between goals. Furthermore, it is how they are to be implemented and how they are monitored to ensure effectiveness which also requires an SD approach. It is not clear if all of the policy and CSR announcements have undergone a Sustainability Impact Test for example.

For the first time, the CSR sets out an analysis of the distributional impact on households of its tax, welfare and spending proposals. The methodology it uses is new and looks at understanding the impact of spending decisions on households, combined with existing and long standing analysis of the impacts of taxes, benefits and tax credits on households together with forecasting and combining impacts across the entire four year period of the Spending Review. However it caveats the analysis saying it is a "static analysis" that "can paint an incomplete picture of the actual outcomes of spending allocations on people’s lives". [3]

The CSR does set out broad environmental impacts but states that "the Spending Review sets spending totals, the exact environmental impact will depend on the decisions of individual departments". [4] However, these individual impact analyses do not help clarify where there are wider effects and the tensions and conflicts between policies. Nor does it help to identify where trade-offs have been made and why. With an SD approach some policies, whilst underpinned by all five principles, will place more emphasis on certain principles than others. Trade-offs should be explicit and transparent.

All new proposals with significant public or private sector impacts must publish an Impact Assessments which should set out environmental, social and economic costs and benefits. It is the role of the NAO to report annually on the quality of the economic analysis of IAs. There is currently no body that reports on how well sustainability has been integrated into IAs. In the past, the SDC undertook a review of eight IAs to help inform its thinking on how well IAs seek to deliver SD.

Finally, in previous CSRs under the previous Government, the CSR announcements would have included agreed Public Service Agreements (PSA) setting out key outcomes and related SD indicators to be achieved. This enabled progress against key objectives to be monitored. While Government has now put into place Structural Reform Plans for each department, for this CSR there is no equivalent, over-arching performance management system to PSAs which gives a systemic view of performance, and it is unclear how the Government intends progress to be measured.

EAC Question: Are there particular policies or cuts that worry you from a sustainability perspective?

· Lack of clarity on what the Government means by "Greenest Government ever"? How does Government intend to measure its success when the only stated commitment has been to reduce carbon on the government estate by 10% by 2010.

· Reforms to the NHS. The reforms will give GPs power to commission patient care and will abolish Primary Care Trusts and Strategic Health Authorities by 2013. Much good work has been done to promote SD within the NHS at trust level. For example, there is a very high uptake of its Good Corporate Citizenship (GCC) tool (over 83% of trusts registered) but it is not clear whether DH will commit to continue investing in GCC from April next year. This is additionally important now that GCC has been mandated in Scotland.

· Given the importance of a sustainable future to young people, and the DfE’s stated intention not to have a separate Sustainable Schools strategy, how will efforts of the hundreds of charities and community organisations across the country wanting to support sustainable schools be directed towards consistent long-term aims? Government is committing in the CSR to providing "capital funding for new schools, rebuilding or refurbishing over 600 schools through the Building Schools for the Future programme and investing in new school provision in areas of demographic pressure". Compared to the ambitions in the previous Government’s BSF programme and given the importance of cutting energy waste and saving money in public services, how will the difference in emissions reduction be met?

· The abolition of the regional tier of governance means there is a lack of strategic planning at a "larger than local level" which would take an SD view. Leaders Boards (and their previous structure as Regional Assemblies) had SD embedded within their strategic planning function and the Regional Development Agencies have a statutory duty on sustainable development. However, the emerging Local Enterprise Partnerships will focus on driving private sector job growth which could be prioritised over environmental and social issues. How will Government ensure that any cross border / cumulative impacts of decision making, especially on respecting environmental limits, be addressed?

· Local Governance and SD -The CSR "provides a settlement for local government that radically increases local authorities’ freedom to manage their budgets, but will require tough choices on how services are delivered within reduced allocations". There is also a proposal to give councils a general power of competence. How will Government ensure local government plays its part in contributing to SD at a time when resources are under pressure? And given that a key regulator which helped drive local government improve SD performance, the Audit Commission, is to be abolished how does Government intend to assure itself that SD improvements will occur? One way could be to require local authorities to contribute to the delivery of SD (as the Greater London Authority is required to do and RDAs did do) or to adopt SD as an organising principle (as the Welsh Assembly Government has).

· Reforms to environment regulators such as Natural England, Forestry Commission and Environment Agency. How will their role continue given their importance to delivery of SD and how will policies such as the mooted proposal to sell off forests include safeguards to ensure sustainable development continues under new ownership?

· The fairness of the proposed welfare policies. Government differ from independent commentators such as the Institute for Fiscal Studies on whether the proposals in the CSR affect those on low incomes or not.

· Social policy reforms such as the abolition of the Warm Front grants with respect to fuel poverty; social housing programme changes with respect to social cohesion and ensuring a strong, healthy and just society; or the social care proposals

· Energy and Climate Change . The work by DECC in the 2050 Pathway Analysis is optimistic that the 80% cut in emissions by 2050 is "ambitious but achievable" and the Annual Energy Statement sets out actions to accelerate the transformation of the energy system and wider economy. As we switch away from fossil fuel sources, even maximising energy efficiency, the demands on the decarbonised electricity grid from energy use will be enormous. There is a recognition by DECC that even if overall demand for energy is reduced we face a "near doubling in demand for electricity, as we shift industry, transport and heating onto the grid". Consideration must be given to moving beyond energy efficiency measure s to fundamentally reducing the demand for energy.

· Green Economy. Despite Government’s initial statement that there was a need for a more "responsible economy" the announcements have all focus ed more on greening our economy. Increasingly, across the world, there is recognition, including by many business leaders, that there is a need for fundamental change to the way business is done and the way the world consumes, requiring rethinking of business models, supply chains and how society values goods and services. This is a key issue for the forthcoming G20 and Rio+20 Earth Summit meetings.

· Transport. Recent announcements such as the abolition of Cycling England and the go ahead for a new high speed rail line appear to be contradictory in SD terms let alone in terms of V f M . It is unclear what analysis has Government made on overall transport policy in the CSR process .

Section 2 – Statutory obligations for SD

EAC Question: Would putting targets for sustainable development on a statutory footing (as under the Climate Change Act for example) make any useful difference to Government performance on sustainable development?

Targets should not be the focus of any statutory obligation for sustainable development. It is unlikely that any set of targets could capture the breadth of sustainable development well enough to make such a statute meaningful. Instead the focus should be on outlining what a government’s duty to sustainable development is, define roles and responsibility, provide a method of enforcement and a framework for developing a future SD strategy which aims to make government decision-making more transparent and accountable to Parliament, private sector and civil society.

Underpinning any SD statute or act and a refreshed SD Strategy should be a performance management framework for understanding the impacts of public policy. This framework could be comprised of key indicators and targets. For further details on performance management frameworks, please see Section 3.

Any organisation or structure that is charged with delivering policy that has environmental and social impacts needs to operate within a single overarching statutory sustainable development duty. Evidence suggests that where organisations are given a general sustainable development duty in addition to other duties (e.g. a duty to contribute to the achievement of sustainable development and to economic growth) they struggle to interpret the additional requirements of the sustainable development duty. [5]

The SDC believes it is important that this duty is not broken down into the separate elements of SD, as has been the case with the Local Government power i.e. to promote economic, social and environmental wellbeing. These elements need to be integrated rather than progressed independently as interpretation of the Local Government duty allows, without this environmental issues will always be the poor relation.

The Welsh Example

A statutory duty to contribute to or to promote SD does have the potential to make a meaningful difference to Government performance. The Welsh Assembly Government has a duty with regard to sustainability. Section 79 of the Government of Wales Act (2006) requires ministers to publish a scheme "setting out how they propose, in the exercise of their functions, to promote sustainable development." The most recent scheme, One Wales, One Planet, was published by the Cabinet in May 2009. This establishes Welsh ministers’ commitment to the centrality of sustainable development in Wales: "Sustainable development will be the central organising principle of the Welsh Assembly Government".

SDC Wales has produced a commentary on the Assembly Government’s progress on sustainable development for 2009-10. It concludes that there are clear signs that the Assembly Government is beginning to back up its commitment to sustainable development with some real action. It has made some improvements to the machinery of government and that there have been ‘tangible improvements in policy’.

The Canadian Example

Canada’s Federal Sustainable Development Act (FSDA) received royal assent on June 26, 2008. The FSDA requires the development of a Federal Sustainable Development Strategy (FSDS), which aims to make environmental decision-making more transparent and accountable to Parliament. Environment Canada is implementing the FSDA and has published the FSDS in Autumn 2010.

However, the Canadian FSDA does not fully embrace sustainable development as it considers only environmental issues. Specifically, the FSDS will focuses on key existing environmental initiatives/priorities:

· climate change and air quality

· biodiversity

· water quality

· greening government operations

This limitation is a serious risk to sustainable development and must be avoided in the UK.

Section 3 – Performance Management Frameworks

An announcement made on ministerial government arrangements for SD (e.g. the Home Affairs Committee) is welcome. However, the follow-up question to such an announcement would be how will the body understand trends and enact change? Specifically, what mechanisms, levers and resources could be used for oversight and change by any cabinet committee?

The current set of SD Indicators is under revision and the revised set will be much more robust, more able to measure progress and deliver wellbeing for individuals and society within environmental limits.

To convert the SD Indicator set into a proper performance management framework, ownership for actual performance describe by each indicator should be given to a discrete part of government which the Cabinet Committee could then work with, and put pressure on, to improve performance in a particular policy area. Ownership for the indicator set itself and for monitoring performance across all policy areas should still sit with the Cabinet Committee.

Such a performance management framework for policy provides a systems approach that considers all aspects of Government business and reflects the interplay of different impacts so as to effectively manage performance and achieve goals. In designing a Performance Management Framework the indicators and measures of progress should:

· Add up to the high level goal/statement/priority

· Be agreed with the relevant scrutineers

· Be meaningful to the public

Government should seek to develop performance management frameworks for policy, operations and people as a package of measures that when combined drive improvements in Government’s sustainability performance.

Lastly, any framework must be designed to improve and effectiveness the level of both democratic accountability and bureaucratic accountability. The differences between these types of accountability and how they relate to transparency is discussed further in Section 4 below.

Section 4 – Bureaucratic vs. democratic accountability

The drive by Government to improve democratic accountability and transparency is laudable. This is key to improving performance and delivering more sustainable outcomes. However, Government’s approach to increasing transparency through increasing the amount of information and data available to the public is not the solution in itself. Generally speaking, government and SD-specific information is fairly esoteric and inaccessible to the layperson.

Real transparency necessitates understanding the context of government performance, as well as the potential for driving performance improvements. The current focus on publishing so-called performance data will satisfy neither criteria, and in any case policy performance cannot be adequately summarised with data. Further, once data is published it is already too late to address performance deficiencies. It is surely far better to get things right first time. Therefore, Government needs a system which:

· Helps departments understand and develop the context for performance, and makes this accessible to the public

· Develops this context to provide an honest understanding of the real potential for improvement (the ‘Greenest Government’ – against what standard and aspiration?)

· Provides honest advice and rigorous challenge to the formation of individual policy and operational delivery plans

All three feed off each other, and necessitate close working with departments and, where possible, a ‘no surprises’ approach to advice, challenge and performance assessment.

One of the SDC’s informal remits has been an interpreter of this information by providing analysis, reports and recommendations in an easily understood and accessible format. The SDC’s reports have given academics, NGOs, individuals and other government bodies (particularly the EAC itself) an effective and efficient way of accessing this information, and in turn accessing independant expertise. The SDC has effectively been acting as an interlocutor between Government and other parts of society on SD issues.

Governmental bodies can provide some interpretation and analysis of SD-specific information, for example Defra’s SD Indicators in your Pocket or CESPs reporting on the SDiG data. However, it is important that there is independent analysis and commentary from an expert body that the public can fully trust.

The SDC does not feel that adequate arrangements have been considered by Government to date on scrutiny and accountability after the 31 March, 2010. The EAC is not resourced to offer the type of accountability formally provided by the SDC. This point is clearly made in the University of East Anglia’s research on the effectiveness of the EAC.

Therefore, the abolition of what Government perceives as an unnecessary and bureaucratic part of this scrutiny model is likely to provide less transparency to the public unless suitable alternative arrangements are put in place. For example, it is unlikely and impractical to assume that a private citizen will examine operational data or look at how well an Impact Assessment incorporates principles of sustainable development into policy and then hold Government to account. A certain degree of bureaucratic accountability is necessary to enable effective democratic accountability.

Indeed, one person’s bureaucracy may be another’s good governance.

8 November 2010