Select Committee on European Union Minutes of Evidence

Examination of Witnesses (Questions 620 - 630)



  620. And always will.
  (Mr Tutcher) That is something we would not want to stop. Just as we may all frown on smoking and smoking rooms and all those things, there is actually a lot of good communication which happens in some smoking rooms, so we would not want to cut down on people coming into the office, we would not want to see that interaction reduced by virtue of being able to work virtually.


  621. Can I move on to another area now? Looking at the work you are undertaking, is there similar work being undertaken in other countries? In particular, in the most successful, the furthest advanced with e-commerce—the States, Scandinavia, maybe Sweden and Finland—has work been done there? How are they dealing with these issues? They are further advanced in some respects than we are.
  (Mr Wilsdon) When we were setting up this project, we did do quite a comprehensive search for similar initiatives both within Europe and further afield. There are studies which have been done, there has been a lot more work done on the social side than there has been on the environmental side. Some very interesting work has gone on in the States, sponsored by the US Government and done by NGOs and community organisations. On the environmental side, there is more interest now and we have seen quite a lot of work appearing in the last six months or so. There was quite an interesting report published in the States in December by an academic called Joseph Romm which looked at the impact of the digital economy and particularly of e-commerce on global warming in the context of what the new economy is doing in the States. He came up with some very optimistic conclusions as to the percentage of CO 2 emission reductions which are going to be achieved through this route. Some have criticised him for perhaps under-estimating the rebound effect in all of this, in that yes, people save energy in some ways but then they obviously use more energy in other ways—they go and buy more new products or they travel further to do other things apart from going to Tesco or whatever. I think that is true. Within Europe, the Commission has for a couple of years now sponsored a project called ASIS, the Alliance for a Sustainable Information Society, which is looking more widely than just e-commerce, it is looking at all information communication technologies but is very much looking at them through the prism of sustainable development and trying to weigh up the economic, social and environmental consequences. ASIS has produced some interesting pieces of work from all sorts of European countries. There was a conference in February which I attended on our behalf and we made some useful links with people there and will be pursuing those over the coming months.

  622. That was going to be my next question. How are you going to link up with initiatives elsewhere?
  (Mr Wilsdon) We will be talking to quite a few of these organisations. There is another big initiative going on in the States at the moment run by a body called the World Resources Institute. They have a big programme called the Digital Dividend which is about the social and environmental dividend which IT and e-commerce will bring. So we will be talking to all these people and hopefully forging links. Our focus in terms of our outputs is primarily the UK in that we are making recommendations to the UK Government, to local authorities, regional development agencies and UK business. Obviously, though, e-commerce is global and you cannot put a ring around it in that sense. That is a challenge for us, I am sure it is a challenge for you in your enquiry as well. It is hard from a government perspective to grapple with something which by its very nature is global.

  623. I am conscious this afternoon we have concentrated primarily on the social issues rather than the environmental ones, I was wondering if there is anything you feel in particular we might be saying about what Europe might be able to do further on the environmental aspects?
  (Mr Wilsdon) I think it would be a very valuable thing if the Commission were to be carrying out research similar to what we are doing here in the UK but looking more widely across Europe. There is a great need, as we have said, for more analysis of these issues and I do not think we are yet at a stage where we can make firm predictions or firm recommendations. As I say, the Commission has been funding some work but nothing which has looked as comprehensively as we are hoping to do in the UK.
  (Mr MacGillivray) I certainly take on board the interest in the question about jobs at the macro-level. We have been thinking rather more about particular impacts in deprived neighbourhoods which we certainly do not intend to ignore, but in terms of the more macro-picture and, if you like, the middle men and women and the impact which came up from Lord Cavendish, that is something which would be very suitable for the Commission to do some research on at the European level, as they have done quite a lot with other sectoral studies.

  Lord Skelmersdale: Many years ago I did an economics course and the one thing which I have retained from it is that economics is an historical science—

  Baroness O'Cathain: Really!

Lord Skelmersdale

  624.—in that you cannot predict the future from it with any degree of accuracy. Would you not say the same is true of your research?
  (Mr MacGillivray) Personally, I think I probably agree with you, but in terms of the metaphor of us being the jury which is deliberating, the important thing to emphasise about this is that the e-commerce revolution has not happened yet and is not inevitable yet. It is not one of these mysterious forces of globalisation which will steamroller over this country. There are a huge number of policy interventions which can be made to steer it one way or the other. So as well as being the jury, it would be nice to somehow shape the outcome of this, because it is not something people are powerless to change. Economics is not the tool to do that but there are ways that the future can be shaped, maybe not predicted entirely but certainly shaped and nudged in a certain direction. I think it is fairly clear from what we have said that we are not completely dispassionate about what we are going to find over the next year and what we will be recommending.
  (Mr Wilsdon) Absolutely. I agree with you, it is going to be very hard to predict in any firm way, but I do not think that removes the obligation on Government, on business, on the policy-making community of which we as Think Tanks are a part, to grapple with these issues in a serious way.

Baroness O'Cathain

  625. Absolutely right.
  (Mr Wilsdon) We are using in methodological terms a scenario-based approach which does enable us to have a bit of flexibility in the way we think about the future. We are not saying, "This is what it is going to look like", we will map out three or four possible worlds if you like and then use those as the under-pinning basis for the research we are doing on specific themes, and the purpose of that is precisely to try and overcome this problem of not knowing.

Lord Skelmersdale

  626. The other problem we have, of course, is that the whole ball game is moving so fast it is likely to be out of date before you get round to publishing it.
  (Mr Wilsdon) Absolutely. We must not forget however many internet years there are to a calendar year.

  627. You are clearly conscious of that fact?
  (Mr Wilsdon) We are, very.

  Lord Skelmersdale: Although I might have done, I did not set out to annoy Lady O'Cathain. It was a serious question. I am glad you are treating it seriously.


  628. Do you think it is inevitable, or if it is not inevitable, what can you do or others do to derail it? I hear of some quite outlandish things being done in the States in the form of campaigning using the internet.
  (Mr MacGillivray) There are definitely some anti-technology movements. My personal view from the Economics Foundation is that some of the most exciting innovations in social policy are coming from a judicious use of new technologies rather than an escape from them. It seems to me that as people come back from their Y2K exile and re-engage with the 21st century, there is a lot of social problems where the new technologies can actually play an active part in alleviating them rather than just being a negative factor which has to be guarded against as best as possible. Some of the work we are promoting at the community level is directly intended to produce benefit rather than being in some way a fire-fighting exercise against the dark forces of globalisation. I think it is inevitable but there is potentially more benefit than harm to be had out of it.
  (Mr Tutcher) Can I add a slightly different view? One that says that I think there is a real opportunity to create economic wealth and we have to be very careful about the environmental implications of that because we are very aware of the consumerism which could result. I think one of the numbers which is produced out of the US is that e-commerce or trading electronically, however you may like to define that, has already contributed something like 0.7 per cent off the inflation rate. Whilst I have not done an economics course, something inside me says there is probably something which is pretty good about driving down inflation through using technology in that way. I think the issue becomes one of how does Government ensure that the extra wealth which potentially can be created is distributed fairly to those who need it most, and yet still give an incentive to those people who are doing most of the creation to actually retain some of it. I think there is a balance to be drawn there, that Government probably does have a role to play through whatever levers it has to make those decisions.

  629. Mr Wilsdon, would you like the last word?
  (Mr Wilsdon) Picking up on John's comment about distributing the wealth, as I say, our study is focused on the UK, there is a lot of good stuff being said by the UK Government about closing the digital divide in this country. From the sustainable development movement, obviously we like to think global, as the phrase goes, and I think there the real challenge lies in the fact that 40 per cent of the people on this planet still have not made a telephone call. That sometimes puts into perspective the hype and the over-enthusiastic way in which governments, businesses and others talk about this stuff, and that makes the real challenges we have in the UK pale into insignificance to some extent.

  630. On that sobering thought I think we will draw the proceedings to a conclusion. Thank you very much indeed for your evidence, it has been very helpful.
  (Mr Wilsdon) Thank you.

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