House of Commons - A 2010-15 progress report

A 2010-15 progress report - Environmental Audit Contents

Annex: Summary of key inquiry findings

International sustainable development

1) Poverty and environmental degradation are urgent global challenges. One in five people in developing regions live in extreme poverty, one-third of urban residents in developing regions live in slums, 13 million hectares of forest were lost worldwide each year in the 2000-2010 decade and global carbon emissions in 2011 were 50% above their 1990 level.[131] Tackling these issues requires a new understanding of the connections between people and planet and global commitment to pursuing sustainable development.

2) The Government's ambition has been "internationally, to achieve environmentally and socially sustainable economic growth, together with food, water, climate and energy security".[132] In September 2015, the UN will agree a new set of development goals—Sustainable Development Goals (SDGs)—to be achieved by 2030. In December 2015, the UN Climate Conference in Paris, will seek a legally binding universal agreement to reduce greenhouse gas emissions. The 2012 UN Rio+20 Earth Summit, and the current development agreement on the Sustainable Development Goals and action on climate change have provided a test of that ambition.

The Rio +20 Summit

3) The United Nations Conference on Sustainable Development—the 'Rio +20' Summit—in June 2012 marked the 20th anniversary of the original Earth Summit. In the interval between the two Summits, despite notable environmental successes through international action, the global environment had further degraded.

4) In October 2011, we published Preparations for the UN Rio+20 Earth Summit,[133] which emphasised the urgency of action as we approach environmental 'planetary boundaries' to halt the unsustainable use of natural resources. There were two main themes for Rio+20: a green economy and the international institutional framework for sustainable development.

5) In 2000, states made an international development commitment—the UN Millennium Development Goals—to be delivered by 2015. Despite improvements on poverty reduction, health and education,[134] there had been less progress on sustainability and environmental protection.[135] The Millennium Development Goals helped shape aid programmes over the previous decade, although globally some of their targets appeared likely to be missed by their 2015 end-date. They focused attention only on what needed to change in the developing world. We urged the Government to support work aimed at launching new Sustainable Development Goals to shift the effort towards the sustainable development and sustainable consumption contributions that the UK and other developed countries would need to make.

6) With no common definition of the 'green economy', we urged the Government to support one at the Summit that would be comprehensive, guaranteeing a 'fair' as well as 'green' economy. At a time of continuing financial recession, we were concerned that countries would aim for a 'slightly greened business as usual', driven by an imperative for economic growth. We pressed the Government to resist such moves. We also prompted the Government to endorse incentives for companies to act sustainably and to integrate businesses in shaping the objectives of a green economy.

7) Rio+20 was a chance for civil society groups, business and individuals to discuss the necessity for renewed commitment to sustainable development, but the engagement with these groups needed to be a process, rather than a one-off discussion. There was an underlying need for a new generation to be enthused about the need for action. We recommended that the Prime Minister attend the Summit to demonstrate the Government's commitment to the aims of Rio+20, within the UK and beyond.

8) In June 2013, we published Outcomes of the UN Rio+20 Earth Summit which considered the UK Government's contribution of the Summit and the commitments it made.[136] The Prime Minister did not attend the Summit, which we considered undermined the Government's demonstration of its commitment to the sustainable development agenda.

9) Despite the promising build-up, many were not content with the Summit's conclusions. There was a lack of concrete agreement on some areas, particularly the green economy. The Summit required the UK, like all countries, to do more on the green economy, but ultimately it left it to individual countries to decide how to take that forward. We advised the Government to prove its commitment to a green economy by producing an overarching delivery strategy.

10) Nonetheless, the commitment from the Summit to develop new Sustainable Development Goals allowed work to begin on a new Post-2015 Development Agenda to integrate sustainable development targets with poverty eradication and climate change targets. We emphasised that the SDGs needed to ensure that development did not jeopardise 'planetary boundaries'.

11) We pressed the Government to continue to facilitate engagement with NGOs, businesses, civil society, and the youth on discussing how to take forward the SDGs and other Rio+20 commitments. The Summit included commitments to build an understanding of sustainable development at all stages of education and to provide the skills needed for the transition to a green economy. We urged that schools address sustainable development in their learning plans.

12) In its response to our inquiries, the Government emphasised that its seat on the UN Open Working Group meant that the UK was well-placed to influence the Post-2015 Development agenda and the SDGs, which would be developed in tandem. It would be left to schools, the Government told us, to make their own judgements on how sustainable development would be reflected in their ethos.[137]

Sustainable Development Goals

13) As we noted in our Outcomes of Rio+20 report, one of the most significant outcomes of the event was the international agreement on the need for SDGs. In December 2014 we published Connected world: Agreeing ambitious Sustainable Development Goals in 2015 in which we reviewed the UK's aims for the SDGs, and the co-ordination across Government and consultation with stakeholders, but also how the Goals will influence domestic policy-making and aid programmes.[138]

14) The similar timing of the SDGs and climate change negotiations, each leading to UN agreements late in 2015, presented an important opportunity to embed climate change thinking throughout the SDGs. We recommended that the Government support a separate climate change Goal given the importance of reaching an ambitious agreement in Paris.

15) International trade has played an important role in reducing extreme poverty, but such gains often come at the expense of the environment. The Government, we said, must demand the highest standards of environmental protection in trade deals. In our Transatlantic Trade Investment Partnership report we emphasised the importance of any agreement not reducing existing EU environmental regulations or being allowed to bring a chilling effect on future policy-making and regulation setting.[139]

16) Our SDGs report reiterated the importance of resource efficiency and the 'circular economy'—a separate Committee report[140]—which should also be embedded in the SDGs. We described how inequality can be a barrier to sustainable development, by undermining social cohesion and excluding some sections of societies from the benefits of development and prosperity. We advocated the inclusion in the SDGs of inequality indicators to help tackle both extreme poverty and inequality simultaneously.

17) The Government will need to co-ordinate all departments to consider the domestic implications of the Goals and pursue policies consistent with sustainable development. Agreeing the right domestic indicators for the SDGs is a vital step in ensuring that they have traction; it is essential that the UK is accountable for its progress in delivering the SDGs, which in turn will require effective data and systems to monitor and report on the UK's delivery of SDG targets. Furthermore, given the global significance of the SDGs and their powerful vision for the next 15 years, we continued to stress the criticality of engaging young people in the UK with the new goals and the concepts of sustainable development.

18) We concluded that the current wide consensus on the components of sustainable development, as set out in the proposed 17 Goals listed in the Open Working Group's report, is historic and powerful. The Government agreed on the need for the SDGs to cover the breadth of the 17 goals in the UN 'Open Working Group' draft, but wanted these to be fewer than 17 SDGs in the final version. The Government rejected our call for the SDGs to specifically address inequality. Instead, it preferred that the SDGs focus on tackling extreme poverty—'leaving no one behind' in all groups of people—and underlined what is saw as a need "to address the shortcoming of the previous Millennium Development Goals by moving beyond measurement by averages".[141] The Government favoured what it termed a "visible integration" of climate across the SDGs, but did not unequivocally support or reject having a separate climate change goal.[142]

Climate Change

19) The bulk of greenhouse gas emissions responsible for our changing climate derive from our use of fossil fuels to meet our demand. Across the world, if we make no efforts to cut use of fossil fuels, global warming could reach up to 7°C this century, which would significantly threaten human welfare and ecological systems.[143] The December 2015 Climate Change Conference in Paris will be vital to averting this by limiting the global temperature increase to a less dangerous margin.

20) The UK is obligated under the Climate Change Act 2008 to reduce its emissions by 80% by 2050 from 1990 levels. The Act established a system of five-yearly carbon budgets, to serve as stepping stones on the way to achieving that aim. The first four carbon budgets, extending to 2027, have been set and we are currently in the second carbon budget period (2013-17). Meeting the fourth carbon budget (2023-27) will require emissions to be reduced by 50% on 1990, requiring significantly strengthened policies to be developed and implemented.

21) In February 2015, David Cameron MP, Nick Clegg MP and Ed Miliband MP signed a joint pledge to tackle climate change to protect the UK's national security and economic prosperity. Those party leaders agreed to seek a strong, legally binding, global climate deal limiting temperature rises to below 2°C; to work together, across party lines, to agree carbon budgets under the Climate Change Act and to accelerate the transition to an efficient low-carbon economy which ends the use of unabated coal for power generation.[144]

Carbon budgets

22) In October 2011, in our report on Carbon budgets,[145] we commended the Government for setting the fourth carbon budget at a level recommended by the Committee on Climate Change. We criticised, however, the Government's announcement to undertake a carbon budgets review in 2014, which might have resulted in easing the budget if the UK's emissions reduction trajectory had been inconsistent with the EU Emissions Trading System (EU ETS). Loosening the fourth carbon budget would have jeopardised reaching the 2050 target and undercut the benefit of having longer-term certainty about Government policy that investors in low-carbon needed.

23) We also looked ahead to the December 2011 publication of the Government's Carbon Plan in the hope that it would have provided a convincing plan of action for delivering the carbon budgets.[146] We recommended that the Carbon Plan be improved by including a quantification of the emissions reductions expected from the policies listed in the Plan, introducing accountability arrangements for government departments and setting out a role for local authorities in delivering emissions reductions.

24) In October 2013, we published our Progress on Carbon Budgets report.[147] Compared with our previous inquiry in 2011, the case for strong action to avoid dangerous climate change had only strengthened. The world was on track to warm by 4°C and the Committee on Climate Change had noted that UK emissions had risen by 3.5% in 2012.[148] On a consumption basis, the UK's carbon footprint had increased over the previous two decades so that the UK had one of the largest in the world.[149]

25) We emphasised that an already evident lax EU ETS emissions limit would put pressure on the 'non-traded' sector to produce further emissions reductions to cover the gap left by the 'traded' sector. However, there were too many uncertainties to warrant changes to the fourth carbon budget. Instead we urged the Government, to identify further policies to bridge the required emissions cuts in the non-traded sector and to explain how it would strengthen the EU ETS. In preparation for a 2015 global climate deal, we also recommended that the Government re-examined introducing a supplementary target focused on emissions 'consumption' embedded in imports.

26) We warned that the Carbon Plan, then recently published, was already outdated: arrangements for managing and reporting progress were not working as intended and required urgent revision to enhance transparency. We reiterated our call for local authorities to be encouraged more directly to play an important role in driving down emissions. There was a serious risk of inaction because of authorities' constrained fiscal position and the Government's decision to not place statutory duties on them to produce low-carbon plans.

27) Despite our advice, in July 2014 the Government went through with the fourth carbon budget review, although as a result it did not amend the budget.[150] This would bring long overdue confidence about the UK's future emissions reduction performance, but only if the Government would identify and employ the additional emissions reduction policies needed to deliver that budget. In the meantime, the EU ETS is still not providing an effective policy lever for emissions reductions of the scale needed, despite efforts to secure reforms in the European Commission. A climate deal in Paris, and an effective EU response to it, will be needed to allow the Government to set an effective fifth carbon budget in 2016. The Government will need to make long-overdue revision to the Carbon Plan which has still not been updated since 2011, and give local authorities emissions reduction targets.[151] Despite the Government earlier concluding that it would continue to account for carbon budgets on the basis of 'production' emissions, it did accept that 'consumption' emissions should be monitored to ensure they were falling in line with the global action required to achieve the climate objective.[152]

28) In their 2014 progress report, the Committee on Climate Change advocated that, whilst the first carbon budget had been met, strengthening of policies would be needed to meet future budgets and that policy decisions would need to be made immediately.[153] This has been a recurring recommendation of the Committee on Climate Change, as we have noted in successive reports on the carbon budgets regime. The Government stated in October 2014 that policy decisions with a financial impact beyond 2015 would need to be considered in the spending plans for the next Parliament.[154]

29) The EU previously had a target to cut emissions by 20% in 2020, relative to 1990, but as we identified in 2008, this would not have been enough to put the EU on a trajectory to deliver its objective of cutting emissions by 80-95% by 2050.[155] The EU agreed in 2010 to raise its 2020 emissions reduction target to 30% if other developed countries pledged comparable emission reductions.[156] The Government wanted the EU to adopt a 50% emissions reduction target for 2030, but did not support proposals for a separate EU renewable energy target, believing that it would compromise member states' flexibility over how they secured a least-cost decarbonisation.[157] We explained in 2013 that renewable energy had an important part to play in delivering the UK's reduction targets, and urged the Government to rethink its hostility to a separate continued target for the deployment of renewables.[158] Nevertheless, in October 2014, EU leaders reached a deal to cut greenhouse emissions by 40% by 2030, with a non-nationally binding renewables target of 27% and increased energy efficiency targets.[159] The UK had continued to oppose nationally binding targets for renewables.

Energy subsidies

30) In our December 2013, Energy subsidies report we calculated that subsidies in the UK were running at about £12bn a year.[160] There is no single internationally agreed definition of what constitutes an energy subsidy, and the Government persistently denied that in non-renewables areas it provided subsidies.

31) The Government's policy of 'no public subsidy for new nuclear' required it to provide only 'similar' support to that provided to other types of energy, but even on that basis we considered that the Hinkley Point C deal was 'dissimilar', notably on support for decommissioning and waste costs. We stressed that new nuclear was being subsidised by what the Government preferred to call 'support mechanisms' and 'insurance policies'. We concluded that Government subsidies for fossil fuels, and their different treatment for nuclear and renewable energy, could undermine the UK's international role in the build up to the Paris Summit and the development of the SDGs.

32) Subsidies for renewables, on the other hand, are a crucial lever to provide certainty to industry and drive investment in those technologies. We recommended that the Government demonstrate leadership in increasing the deployment of renewables and in promoting energy efficiency through targeted use of subsidies. Compared to nuclear energy, the Government was being less helpful towards onshore wind energy. DECC might want to bolster wind renewables but the DCLG Secretary of State had intervened in 52 onshore wind farm planning applications since June 2013,[161] with 310 out of 746 rejected in 2013.[162] These two departments appeared not to be following a consistent policy on the need for renewable energy.[163]

33) In the meantime, Government's subsidies comprise of field allowances for North Sea oil and gas despite the Government's assertion otherwise, and its capacity payments regime for gas-fired electricity generation because in practice it will be the only eligible technology.[164]

34) The Government has continued to reject our assertion that fossil fuels, new nuclear and fracked gas are subsidised in the UK.[165] That attitude appears to have also been reflected in the Government's approach to providing overseas aid, which has often been directed at countries having fossil fuel subsidies, and the UK's continuing export support to fossil fuel projects.[166]

Fracking

35) Exploratory drilling for shale gas having begun, the Government sought through its Infrastructure Act to ease the process for fracking operations. In our January 2015 report on the Environmental Risks of Fracking, we recommended a moratorium on this type of energy.[167]

36) We raised concerns about potential environmental protection issues, but we stressed that fracking was also inconsistent with UK obligations under the Climate Change Act and its carbon budgets regime. The Government needed to reduce the carbon intensity of our energy. Shale gas could not be regarded as low carbon. Any large scale extraction of shale gas in the UK was likely to be at least 10-15 years away, and therefore would have no role in driving out dirtier coal from the energy system because by then unabated coal-fired power-generation should have been phased out to meet EU emissions directives. It could not therefore be regarded as a 'transitional' or 'bridging' fuel. It is also unlikely to be commercially viable unless developed at a significant scale, but large-scale fracking will not be able to be accommodated within still tightening carbon budgets.

37) We called for a moratorium on fracking to avoid the inconsistency with our climate change obligations and to allow the uncertainty surrounding environmental risks to be resolved. We recommended an amendment to the Infrastructure Bill to explicitly bar the fracking of shale gas. Following our inquiry and other's concerns, the Infrastructure Bill was amended to add environmental safeguards and to require the Committee on Climate Change to monitor the compatibility of shale gas production with the carbon budgets regime.

Climate change adaptation

38) In addition to the statutory requirements placed upon the Government to mitigate climate change and remain within a series of carbon budgets, the Climate Change Act 2008 also put in place a policy framework to promote Climate Change adaptation in the UK. It required the Government to produce an assessment of the risks for the UK of the current and predicted impact of climate change. Accordingly, the Government published a UK Climate Change Risk Assessment in 2012,[168] which informed the first National Adaptation Programme (NAP), in 2013, setting out what government, businesses and society were doing to adapt better to the changing climate.[169] The Risk Assessment and the NAP have to be updated every 5 years—the next Risk Assessment in January 2017 and the next NAP in 2018. The Act charges the Adaptation Sub-Committee (ASC), to advise the Government on the preparation of each of those documents—the first advisory report being due in July 2015.

39) In our March 2015 Climate change adaptation report[170], we found that the first NAP had created buy-in through its bottom-up contributions from many organisations. It had however, not identified proactive adaptation policies or driven action in a coordinated way and it had lacked a spatial focus to help develop landscape-scale or regional strategies. We recommended that the Government ensure that the next NAP provided a more top-down strategic direction, with a spatial focus, and create a set of measures and targets against which progress can be measured.

40) We also recommended that the Government should enforce the powers it already has to require 'Sustainable drainage systems' in developments, particularly on floodplains, and to remove the developers' right to connect homes to the public sewer. The Government should undertake a review of the physical resources, capacity and skills available for emergency response. It should also consider making adaptation reporting mandatory for organisations managing critical infrastructure and services, and introducing universal water-metering in water-stressed areas.

Environmental protection

41) During this Parliament the Government published a Natural Environment White Paper and established the Natural Capital Committee. The 2011 document set out an ambition that this be "the first generation to leave the natural environment of England in a better state than it inherited".[171] It has not been possible to measure precisely whether overall such an ambition has been achieved, but it was possible to identify the state of progress in particular environmental areas in our Environmental Scorecard and other inquiries.

Environmental Scorecard

42) Our Environmental Scorecard report in September 2014 assessed biodiversity, air pollution and flooding as 'red' risks, and thus areas of particular concern.[172] The remainder were assessed as 'amber' because in none of the other seven environmental areas we examined was satisfactory progress being made. We advocated that new processes and structures were needed to embed environmental protection into policy-making to ensure ecosystem services remain available to the next generation. That entailed natural assets being measured and valued, and for decision-making to be founded on a clear understanding of how policies might help or harm all aspects of the environment. We also emphasised that regulation was the essential underpinning of environmental protection.

43) We criticised the failure to identify the approaches and policy-levers needed to protect different areas of the environment, and the lack of systems to hold the Government to account for its overall performance on the environment. An overarching Government Environment Strategy was needed. We recommended that the Government set up an independent body—an 'office for environmental responsibility'—to review such a Strategy, advise Government on policies needed and monitor performance against the Strategy and its targets.

44) The Natural Capital Committee (NCC) was established to help Government understand how the state of the natural environment affects the economy and individual well-being, and to advise Government on how to manage our natural wealth sustainably.[173] The NCC concluded that we were not on a trajectory to meet the Government's long-term vision of being the first generation to leave the natural environment in a better state than that inherited, so identified a need for a 25 year plan to improve our natural capital "within this generation".[174] In June 2014, we urged the Government to signal its commitment to the NCC by responding formally to its annual reports, by putting the NCC on a long-term statutory footing and accepting the NCC's key recommendation for a 25-year plan.[175]

45) Instead, the Government has extended the NCC's remit by six months (to September 2015) so that the next Government can consider the NCC's fate.[176] The NCC's most recent report in January 2015 urged the Government to "assign institutional responsibility for monitoring the state of natural capital",[177] similar to our earlier recommendation for an 'office for environmental responsibility'. Without the NCC, or another similar body, there are inadequate systems in place to advise Government departments on the sustainable use of natural resources.

Air quality

46) Our December 2014 report on Action on Air Quality was the third in five years on this subject.[178] Air pollution continues to be an invisible killer, causing 29,000 early deaths every year. The European Commission launched infraction proceedings against the Government in 2014 because 34 of 43 zones failed to meet EU Ambient Air Quality Directive targets for nitrogen dioxide pollution. Some zones will not meet the required limits until 2030.

47) It is clearly unacceptable that people could have their health impaired over decades before this problem is brought under control. We recommended that the Government updated the 2007 Air Quality Strategy with clear demarcation of responsibilities between departments and between central and local government; work with local authorities to establish best practice in tackling air pollution; introduce a national framework for low emission zones; examine fiscal measures to encourage a move away from diesel vehicles; and strengthen planning guidance.[179]

48) The European Commission issued new draft proposals on clean air in December 2013, but in December 2014, withdrew them from its 2015 work programme.[180] The delay in putting into operation the measures contained in the now withdrawn legislation will undermine the essential improvements our report endorsed. The Government response to our report identified a number of areas where work is in progress over the remainder of 2015—notably in preparing the next Air Quality Strategy.[181]

Biodiversity

49) In our October 2012 report on Wildlife Crime,[182] we criticised the Governments fragmented wildlife protection laws, which were being inconsistently applied by the courts. We were concerned that birds of prey were being poisoned with substances that had no legal use, and urged the Government to make possession of such poisons an offence. We also examined how the rhino, tiger and elephant were being driven to extinction by growing demand for illegal wildlife products in south-east Asia and China, and called on the Government to exert robust diplomatic pressure for greater enforcement of wildlife law. At the heart of the wildlife crime problem, however, was a lack of long-term funding for the Wildlife Crime Unit charged with setting priorities and co-ordinating action within the UK.

50) The Government rejected our calls to ban possession of the poison used to kill birds of prey but they did accept that legislation relating to wildlife crime needed to be simplified.[183] It eventually provided an additional year of funding for the Wildlife Crime Unit, but this is now again an area of uncertainty beyond the Election.

51) In April 2014, in our Invasive non-native species report we highlighted the detrimental effects that invasive species can have on the native species they supplant.[184] This is a difficult policy challenge because continuing climate change is driving species' ranges to higher latitudes, so action against regionally displaced species may exacerbate their plight. We called for better prevention, surveillance, and long-term control measures, but tailored to such climate change induced migrations. We criticised the current system of listing species to be monitored in England and Wales for being too slow, and recommended the introduction of species control orders similar to Scotland's. These were being examined by the Law Commission, and were subsequently introduced through the Infrastructure Act.

52) We criticised the Government's proposals for 'biodiversity offsetting', which would have allowed damage to the environment and ecosystems arising from a development to be compensated for by providing biodiversity resources elsewhere. The Government set out its proposals in a Green Paper in September 2013, including a prospective metric for calculating biodiversity gains and losses.[185] At the same time, Defra, Natural England and local councils were continuing with six offsetting pilots which had begun in 2012. In our Biodiversity Offsetting report we cautioned that offsetting should follow the 'mitigation hierarchy' so that it would only arise after alternative development sites or means of mitigating any environmental loss from development had been considered.[186] The Government's proposed metric was also too simplistic.

53) We recommended that the Government allowed the offsetting pilots to run their course and then be evaluated independently, which it accepted.[187] The pilots were completed some time ago, but the policy does not appear to have been developed further.

High Speed 2

54) In our April 2014 HS2 and the Environment report we examined a specific proposed application of biodiversity offsetting.[188] We advised the Government to aim higher than their 'no net biodiversity loss objective', which did not match the generational improvement objective of the Natural Environment White Paper. Significant work would be needed to show that the 'mitigation hierarchy' was at the core of the Government's approach, given the damage that would be expected to ancient woodlands, SSSIs and local wildlife sites. Whilst Defra evaluated its offsetting trials, the HS2 Environmental Statement proposed a metric for assessing biodiversity offsetting which did provide some additional protections, though not enough to protect ancient woodlands. The Government accepted our recommendation for an independent body to oversee the monitoring of HS2's newly created offset habitats.[189]

Pollinators and pesticides

55) Pollinators are essential to both agriculture and our biodiversity. In recent years, two thirds of species of wild insect pollinators have experienced population decline in the UK. Potential contributing factors included climate change, habitat loss, parasites and the use of pesticides, particularly neonicotinoids which our April 2013 Pollinators and pesticides report explored in detail.[190]

56) There was insufficient data to produce an accurate view of the extent of declining populations of particular pollinators, and contradictory scientific evidence on the effect of neonicotinoids. We recommended, following the precautionary principle, that the Government ban the use of three neonicotinoid pesticides. The Government rejected our recommendation, disputing the conclusions from the evidence and applying an economic factor to the precautionary principle. The European Food Safety Authority's risk assessment of the three neonicotinoids resulted in the European Commission introducing a two-year moratorium on their use on crops attractive to bees in December 2013.

57) Subsequently, our National Pollinator Strategy report in July 2014 examined a draft National Pollinator Strategy under consultation.[191] This introduced many welcome features, including a national pollinator monitoring framework and a programme of research. Less welcome was Defra's reliance on industry to fund further research on neonicotinoids. This was symptomatic of Defra's loss of capacity to deliver environmental protection, which we warned might result in commercial, rather than scientific, research priorities being followed.

Marine environment

58) In November 2013, the Government designated 27 Marine Conservation Zones (MCZs)—falling short of the 127 sites previously recommended. In our May 2014 Marine Protected Areas report we criticised this slow pace of progress and called on the Government to bring forward the schedule of the MCZ programme.[192]

59) A separate problem was that budget reductions in the Marine Management Organisation—the body charged with managing the zones—made it difficult to demonstrate that it had the resources needed to manage and enforce the MCZs. Subsequently, the Government announced a second tranche of 23 MCZ's in February 2014, still some way short of the potential. In our inquiry on Sustainability in the UK Overseas Territories we also explored the scope of Marine Protected Areas further afield.

Sustainability in the UK Overseas Territories

60) Our 2014 Sustainability in the UK Overseas Territories[193] report also examined the Government's first White Paper to address the UK's relationship with the Overseas Territories since 1999.[194] We criticised the Government's unwillingness to address its responsibilities under UN treaties for the environmental performance of the Territories. The Government was prepared to exercise its hard and soft powers on financial matters, but was not prepared to exercise those powers to protect biodiversity and to promote environmental sustainability. In environmental terms, the 2012 Overseas Territories White Paper was a missed opportunity. The Government maintained that environmental protection in the Territories was their devolved responsibility.

The green economy

61) Current patterns of economic growth are unsustainable because they reduce the availability of natural resources and the ecosystem services they provide. In 2010, the Government announced an ambition to "build a new economy that supported sustainable growth and enterprise, balanced across all regions and all industries, and promoted the green industries essential for the future."[195] The transition to a green economy requires investors to take account of a carbon constrained world. The scale of investment needed is unprecedented—£200 billion or more over this and the next decade.[196] Subsidies and incentives for low-carbon energy are part of the solution, but a green economy also needs wider Government support, targeted environmental taxes and attentive sources of finance. Traditional sources of capital for investment in green infrastructure are expected to provide £50 to £80 billion up to 2025, leaving a funding gap running into hundreds of billions of pounds.[197]

62) Our May 2012 Green Economy report[198] concluded that the Government's Enabling the Transition to a Green Economy[199] was a missed opportunity to show global leadership on this area at a crucial time in the run-up to the Rio Summit. It did not set out a new, comprehensive or strategic approach for a green economy with targets to assess progress, but rather listed existing policies. It lacked a long-term vision of a green economy, and was not the 'roadmap' to get us there that had previously been promised. The definition of a green economy adopted by Government did not address all three pillars of sustainable development. The approach placed no new requirements on businesses and was too focused on voluntary action. We emphasised that reliance on consumer demand to stimulate the green economy would not work. Enabling the Transition suggested things that businesses could, rather than should do, which would not provide the platform to deliver the magnitude of green investment needed.

63) We recommended that the Government set key milestones for businesses to achieve reduced emissions, waste and resource use. We advocated a strategy which was also framed in terms of sustainable development and which quantified 'environmental limits' that were most affected by economic activity. The Green Economy Council, we concluded, should be strengthened by broadening its representation to include civil society, its actions made transparent to provide public confidence that a green economy was being pursued in a fair and inclusive way, and be given a role in monitoring and reporting progress towards a green economy.

64) Despite hopes that the green economy would be a big theme at the 2012 Rio+20 Summit, in the end it was not. In the UK, similarly, the Government's approach to the green economy has lacked a sustainable development grounding, as our review of the subsequent Industrial Strategies initiative demonstrated. The Green Economy Council has not met since January 2013.[200]

Environmental taxes

65) Taxation is an important policy lever for environmental protection by ensuring at least some costs are borne by those responsible for environmentally damaging behaviour. Our July 2011 Budget 2011 and Environmental Taxes report highlighted the importance of environmental taxes being seen as fair so that political momentum could be gained for higher environmental taxation.[201] The Government had undermined public trust in green taxes by being seen to use them mainly as a revenue raising tool rather than an attempt to change environmentally damaging behaviour. Hypothecating some of the revenues for investment in green alternatives would help build trust and support for environmental taxes. We recommended that the Government took a more coherent approach to environmental taxation by adopting a clear strategy, setting out their rationale and the basis on which rates would be set. No such environmental taxation strategy was produced by the Government.

Circular economy

66) A 'circular economy' maximises the use and value of resources, and reduces waste. It offers an alternative to the current approach where resources are typically used for one purpose and then discarded, which we concluded in our July 2014 Growing a Circular economy report was not sustainable.[202]

67) Our report on Plastic Bags presented an example of this wasteful approach.[203] With over 8 billion plastic carrier bags used each year in England, reducing bag use would have significant environmental benefits in terms of lower carbon emissions, resource use and litter. We welcomed the Government proposed 5p charge for carrier bags from October 2015, but not its proposals to include all retailers in the charge scheme, and for an exemption for 'biodegradable' bags. The Government's legislation subsequently excluded, however, the biodegradable bag exemption.[204]

68) We recommended that the Government embrace the EU's targets for improving resource efficiency by 30%, and that it take more direct action to facilitate a circular economy.[205] The Government could have introduced differential tax based on life-cycle analysis of the environmental impact or recycled content of products, and reformed taxation and producer responsibility regulations to reward companies that design products with lower environmental impacts and ensure that resources are re-used. We advised the Government to introduce a greater standardisation of local waste collection services, including separate food waste collections and a ban on food waste to landfill. The Government needed to work with the EU to develop eco-design standards across a range of products and set out steps that would lead towards a ban on products made from unrecyclable materials.

69) The Government rejected our proposals, including for greater standardisation in collection systems, and would not compel councils to adopt household food waste collections.[206] Furthermore, the European Commission has dropped its proposals for new targets on resource efficiency and waste recycling from its 2015 Work Programme.[207]

The Green Investment Bank

70) We have monitored the development, launch and early operation of the Green Investment Bank since it was initially proposed in 2010.[208] The bank was a key strand in efforts to close the green investment gap by making finance available for renewable energy and waste projects that found it difficult to get funding. An important issue from our March 2011 report on the Green Investment Bank onwards was its inability to borrow to boost the scale of its investments beyond the £3bn provided by the Government, in order to make significant inroads into the green finance gap.

71) We followed up progress in our March 2014 Green Finance report and again criticised the Bank's inability to borrow.[209] The Government maintained its stance of only considering the scope for borrowing once Government debt was falling, which would not happen until the next Parliament. On the positive side, the Bank has backed over 44 green infrastructure projects, committing £2bn the UK's green economy[210] and secured State Aid Rules approval to invest in community energy schemes.[211]

Green finance

72) In our March 2014, Green Finance report,[212] we highlighted how stock markets were inflating a 'carbon bubble' by over-valuing companies that held fossil fuel reserves that would be unburnable if a global climate deal were agreed. A readjustment of company values might be sudden and produce market instability. In response to our inquiry, the Bank of England told us that it would monitor the status of such 'stranded assets'.[213]

73) The UK, as a world leader in finance, had untapped opportunities to lead on low-carbon investment, including in community energy schemes. We urged the Government to play a central role in international efforts to ensure markets price-in the cost of carbon. A green finance strategy was needed to create greater market certainty and a more favourable investment outlook by clearly setting out Government policies on the linkages between the green economy, climate change action and Industrial Strategies.

Embedding sustainable development across Government

74) Embedding sustainable development across Government involves providing decision-makers with the skills and resources to consider the consequences of policies on the environment, the economy and wider society, now and in the future. Throughout this Parliament we monitored the performance of Government against sustainable development targets—'Greening Government Commitments'—to identify actions that the Government should take to make its policies and operations more sustainable.

75) Our inquiries followed the Government's July 2010 announcement to abolish the Sustainable Development Commission and embed sustainable development in Government departments. In our January 2011 Embedding Sustainable Development Across Government report[214] we concluded that this provided an opportunity to reassess the architecture for delivering sustainable development. We advocated that sustainability needed to be driven from the centre of Government, with a dedicated minister based in the Cabinet Office.

76) Two years on, in our Update report[215] we concluded that guidance for Government departments on policy appraisal and impact assessments had improved, but that Defra needed to develop guidance further and challenge departments where they were non-compliant. We found that the Cabinet Office's Business Plan review process had a significant weakness in not seeking to address potential policy gaps, where new initiatives could be identified to tackle unsustainable development. A delay in issuing the 2013-14 Greening Government Commitments (GGC) results until February 2015, with no indication of performance expectations for the imminent end of the GGC period is regrettable. Despite this, progress towards meeting the targets appears to have been made in 2013-14, although not consistently across departments.[216]

77) We announced in Update report that we would examine more directly how individual departments were engaging with the new sustainability systems. BIS was our first departmental inquiry.[217] Overall, we found that the Department was delivering on its sustainable operations targets and had established a 'Sustainability Champion.' We encouraged other departments to follow suit. On policy-making, however our analysis found that environmental and social aspects of sustainability were not getting the same attention as economic factors. The Regional Growth Fund's process for assessing applications for grants did not quantify any environmental or social harms associated with projects put forward. The Department's 'Industrial Strategies' for 11 sectors, including several with particular environmental sensitivity—offshore wind, oil and gas, nuclear, aerospace, automatic and construction—aimed to maximise industrial output without considering the environmental impacts.

78) As we requested, the Green Economy Council undertook a review of the Industrial Strategies in December 2014.[218] They concluded that both Government and industry needed to look beyond the immediate needs of the economy and broaden their vision to include a strong and unequivocal commitment to environmental and social sustainability. The Green Economy Council reinforced our earlier view that the environmental and social aspects of sustainability were not getting the same attention as economic factors.

79) Subsequently we undertook similar inquiries in the Home Office[219] and the NHS.

Well-being

80) Recent development of measures of sustainable development in the UK has been progressing on two fronts: a 'Measuring National Well-being' initiative, set up by the Prime Minister in 2010 and being run by the Office for National Statistics (ONS), and a Defra-managed revision to the Sustainable Development Indicators (SDIs). In our Sustainable Development Indicators report[220] we examined the proposed SDIs under consultation. We highlighted that the distinction between the ONS focus on 'current well-being' and the SDIs on 'inter-generational' well-being was likely to be unclear for the public and policy-makers, and the frameworks' separate development risked undermining a coherent view of well-being.

81) In 2014, in our Well-being report, we concluded that three years after the Prime Minister's declaration that we should be "measuring our progress as a country not just by our standard of living but by our quality of life",[221] well-being measures were not receiving the same consideration as economic ones.[222] The ONS' work on 'subjective well-being' produced valuable insights into people's satisfaction with society, our environment and our economy. Producing a single headline indicator of well-being, which might be considered alongside GDP, could prompt worthwhile debate about what matters most to people, but risked not being accepted by those who disagree with the weightings given to particular components of well-being. We recommended that well-being considerations should increasingly drive policy-making, and that the Government used the already available data to 'well-being proof' existing policy proposals, and set out a clear plan for how and in what circumstances the data should start to be used to identify new policies.

131 United Nations, The Millennium Development Goals Report 2014, (2014) Back

132 H M Government, The Natural Choice, Securing the value of Nature, (June 2011), p58 Back

133 Environmental Audit Committee, Eighth Report of Session 2010-12,Preparations for the Rio +20 Summit, HC 1026 Back

134 United Nations, The Millennium Development Goals Report 2014, (2014) Back

135 Environmental Audit Committee, Seventh Report of Session 2014-15, Connected world: Agreeing ambitious Sustainable Development Goals in 2015, HC 452 Back

136 Environmental Audit Committee, Second Report of Session 2013-14, Outcomes of the UN Rio+20 Earth Summit,
HC 200 Back

137 Government Response to Environmental Audit Committee's First and Second Report of Session 2013-14, Embedding sustainable development and the outcomes of the UN Rio+20 Earth Summit, HC 633 Back

138 Environmental Audit Committee, Seventh Report of Session 2014-15, Connected world: Agreeing ambitious Sustainable Development Goals in 2015, HC 452 Back

139 Environmental Audit Committee, Ninth Report of Session 2014-15, Environmental Risks of the Trans-Atlantic Trade & Investment Partnership, HC 857 Back

140 Environmental Audit Committee, Third Report of Session 2014-15, Growing a circular economy: Ending the throwaway society, HC214 Back

141 Government Response to Environmental Audit Committee, Seventh Report of Session 2014-15, Connected world: Agreeing ambitious Sustainable Development Goals in 2015, HC 1067 Back

142 Government Response to Environmental Audit Committee, Seventh Report of Session 2014-15, Connected world: Agreeing ambitious Sustainable Development Goals in 2015, HC 1067 Back