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6.49 pm

The Earl of Selborne: My Lords, I shall follow the theme introduced by the noble Lord, Lord Soley, and the right reverend Prelate the Bishop of Chester, by discussing some of the environmental issues that national policy has to address. I shall set them, however, in a global context, because all the environmental issues that we are likely to address are after all shared around the world. I should declare an interest in the sense that I chair a government programme called Living with Environmental Change—it is a government programme in that it is publicly funded. It is supported by all the research councils and a number of government departments and agencies. It takes an interdisciplinary approach to looking at the contribution that research and development in this country can make to some of these overarching environmental issues.

I need not repeat—because we have heard then already very eloquently described—some of the climate change issues with which we are anyway familiar. But looking at environmental change more widely, one has to recognise the exploitation of our natural resources. Some would say that we have reached a point where we are in danger of tipping some of our life systems. We know that depletion of aquifers and other water sources is one of the greatest threats to humanity not very far into the future. Looking at the depletion of global fish stocks, we know that very few if any fish stocks can really be described as sustainable.

One of the consequences of this environmental change is that with increasing urbanisation we are reducing the amount of land available for food production at the very time when our demand for food is rightly increasing. It is not just that the population is increasing: affluence is also increasing and with affluence comes the laudable objective of trying to achieve a standard of nutrition that we take for granted in the developed world.

With these concerns comes the recognition that we have been profligate in felling forests, with great consequences for climate change and loss of diversity. The World Wide Fund for Nature deserves some credit for having put forward so eloquently the concept of one-planet living, which aims to achieve a global

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society in which we live within the regenerative capacity of the planet's ecosystems and with an equitable distribution of resources. That puts it very well. In other words, we are urged to measure our ecological footprint and then find ways to reduce our adverse impact. There will always be some adverse impact: I am not suggesting that you can live without such an impact.

The challenge is to plot a way of returning to economic growth, to which we all aspire, while using less of the planet’s resources and reducing our waste and emissions into soil, air and water. Clearly, we cannot use fossil fuel as prodigiously as in the past 100 years. Therefore, we need to move from using ancient sunlight captured millions of years ago and now fossilised or turned into oil. We need to move to a sun-based economy using today's sunlight. I do not mean solar panels: I mean using plants, which after all are biorefineries themselves, and using them much more efficiently. If we develop biorefineries rather than oil refineries we will go some way towards a sustainable energy source.

We have debated in recent months what we mean by the second generation of biofuels, and this is when we look at innovation and hope. I remain na├»vely optimistic that innovation can and will deliver some real opportunities. There is an opportunity to turn the second generation of biofuels—any biodegradable waste, whether lawn mowings, crop residues and much else—into fuel sources. Indeed, pilot schemes are already in existence. That removes the conflict that currently exists between food production and energy production. That is the agenda which I have tried to sketch out. We want to maintain our standard of living and others to match it. We want to turn to new energy sources which are less polluting, but we need above all to feed, house, and provide employment for an increasing world population, and we do so as water supplies are already overstretched. I agree so much with my noble friend Lady Shephard when she points out just how critical it will be to ensure that our agricultural resources are used to try to match that particular aim.

I feel very strongly that we need not only to protect and conserve but to restore all our damaged habitats. We are only beginning to realise the scale of the danger in degrading biodiversity and losing opportunities that we do not yet understand might exist in the natural world. We have already tried some of the instruments that can achieve those overarching aims in the field of climate change, such as trading schemes, financial instruments and, of course, regulation. However, I come back to innovation not as the sole solution but clearly an important and more positive aspect of regulation in trying to achieve these objectives. I suspect that those countries that move into the green economy faster than others will be doing themselves a great service. They will be exporting green technologies to others and producing clean power, clean water, clean air and healthy and abundant food. They will get the economic benefits. These green technologies will be as critical as information technology was when last we had a recession in the early 1990s when some say that the web and other such developments pulled us out of the recession.

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I recognise that the gracious Speech was a bit thin to say the least on the environmental measures that will help to achieve these overarching aims, but the Marine and Coastal Access Bill is certainly an important contribution. It is part of a much wider national and international agenda. At this very moment, the United Nations Climate Change Conference is going on in Poland and the United Kingdom has to ask what we can realistically contribute from our own perspective towards these issues which I have addressed and which are entirely global.

I return to innovation. We have a very strong research base. Perhaps it is not as strong in the field of agricultural and environmental research as it was, but it should still be recognised. Agricultural and environmental research is only one aspect. Many of the problems will be dealt with by political economy and the social sciences. It is a multidisciplinary approach—a new approach to how one makes effective development. Research and development is the key to addressing many of these issues. It will not in itself be sufficient, but we need to ensure that our own management of research is spread inevitably and perfectly correctly between government departments, and government agencies and new organisations such as the Technology Strategy Board, which will have an enormous influence in promoting the new and old technologies that are appropriate for so many of these causes. We need to ensure that we have an integrated approach to rolling out all these research and development opportunities.

6.57 pm

Lord Smith of Leigh: My Lords, I intend to concentrate on two aspects of the gracious Speech—on the snappily titled Bill we discussed earlier and on the overriding theme of the gracious Speech; namely, dealing with the economic downturn, particularly the role of local government in that. I have resisted any attempt to speak on transport. One of my roles is chair of the Association of Greater Manchester Authorities. We conducted a referendum campaign on a transport package and I have spoken far too much about transport. The results will be out at lunchtime on Friday, when I will see whether I will be depressed all weekend. I also declare an interest as Leader of Wigan Council and chair of 4NW, which I will come to in a moment.

My noble friend will be relieved that she has only one major Bill to deal with this time because she certainly had a lot to do in previous years. But it is an important Bill and I particularly welcome the way that it will bring in aspects of the national review, which was first published in July 2007. It is important to recognise that there is a regional dimension. Although I was interested in the comments of the noble Baroness, Lady Warsi, I do not think she quite understands that the regional assemblies and the new forum will provide opportunities for local authorities to talk about problems that stray beyond their original boundaries. Economic matters are not confined within the boundary of one local authority but spread over a number of local authorities. I know that my Conservative colleagues in the north-west welcome the fact that they have an opportunity to talk and to try to find a way forward for the north-west.

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The Bill will allow local government a much stronger role in shaping the economic strategy of the regions, which in the past has been imposed on them. However, I have to confess to my noble friend that we jumped the gun somewhat in the north-west. Last July, we abolished the regional assembly and created a body called 4NW, which is effectively the regional leaders forum in the legislation. It is building on our past record. We have a good record with the RDA and with government offices and have already discussed the policy direction of the single regional strategy. In Greater Manchester last August we reviewed our constitution to help to deliver the strategies of our multi-area agreement. We set up seven commissions, one of which will be called—again, snappily—Economic Development, Employment and Skills. This is doing, effectively, what the economic prosperity board in the Bill will be doing. Perhaps we will be slightly different because the majority of our members are not from local authorities and the chairman is from the private sector. It will be interesting to see how others do it. Clearly, local government should be at the heart of local democracy, so I welcome those parts of the Bill and look forward to discussing the detail of that in Committee.

Daily we see the severity of the economic slowdown in the country becoming more apparent. Local authorities need to be well placed to respond to this. The power of well-being, which I remember being fully debated in the first local government Bill that I was involved in back in 1999-2000, gives us the power and responsibility to get involved in these areas, to look at the impact on our communities and to respond in a way that, perhaps, we had not in the past. As the noble Baroness, Lady Hamwee, mentioned, the economic downturn will clearly have a negative impact on local authority finances. Deloitte has estimated that, with the increased costs and the reduction in income, there will be around a 6 per cent cut in local authority budgets. Clearly, it is not a time when we can think of passing any of that on to council tax payers. Unlike the noble Baroness, Lady Hamwee, I believe that this is a time when local authorities should, can and want to be innovative about moving resources to front-line services, and working in partnership with other authorities to make sure that it can be done effectively.

The Government recognise the role that local authorities can play in tackling the downturn as they involve local authorities, both regionally and nationally, in the regional economic councils. In response, many local authorities have already agreed to the 10-day payment requirement and have set up advice centres to deal with people with debts, particularly those with housing issues. It is well known that people who seek advice on housing matters before going to court regarding repossession orders fare much better than those who do not. We want to work with local small businesses, but there is a small issue that the Minister may want to think about. While we can be sympathetic in accepting late payments from local small businesses to ease their financial burdens, the Audit Commission judges local authorities by the efficiency with which they collect their debts. There may well be a contradiction between our being helpful and considerate to small businesses and being downgraded by the Audit Commission.

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It is also important for local authorities to participate in apprenticeship schemes. I remember the 1980s, when children leaving school were unable to find employment. Many of those cohorts of kids are still the core of the workless today. They have not been in employment for the past 20 or so years. We do not want any more Thatcher’s children in this country. We are also willing to participate in the capital projects but, again, I remind the Minister that capital projects can take a while to get off the starting blocks. We need to protect those PFI schemes which are in danger because of the financial problems in the City. Those schemes can be delivered if they continue to get funding. In the north-west, the scheme for the Carlisle northern bypass has been struggling with its PFI. The Greater Manchester waste project is probably the biggest waste project in Europe but, again, if it does not get its PFI, jobs will be lost and valuable activities will not take place. One of the short-term issues should be to make homes more energy-efficient. If we can do that, we can create good jobs that will upskill people and get them to save money on their energy costs and be green at the same time. It is a good kind of project.

My noble friend Lady Jones mentioned housing. I do not want to go into the whole subject but I do want to raise one issue. There is something of a conflict with what CLG is trying to do over the policy on housing subsidies in the public sector. It has a policy of trying to redistribute housing subsidy. That may have been the right policy in the past but I do not think that it is in the current climate. There is a great inconsistency. If I, as a leader, was to recommend a council tax rise of above 5 per cent, I would be capped, but the CLG recommends that we raise our council rents by 6.35 per cent. That will affect some of the poorest members of my community. I hope the Minister will think about that. At this time, do we want to tax the poorest in our communities? I know some of them will be on benefits, but many, with small savings and job-related pensions, will not. We should be able to demonstrate that, within the current economic downturn, there are many local solutions to issues that occur locally. Local authorities are well placed to deliver those.

7.05 pm

Lord Tope: My Lords, I begin by declaring some interests. For over 34 years I have been a councillor in the London borough of Sutton. I am pleased to say that for the past 22 years the residents of that borough have enjoyed a continuously Liberal Democrat administration. Indeed, this year the Audit Commission, in its corporate assessment, awarded the administration the highest possible rating of four stars and judged it to be “improving strongly”, even after all those years.

The other interest that I want to declare is even more relevant. I have been a member of the Committee of the Regions, the EU body set up under the Maastricht treaty 15 years ago to be, in simple terms, the voice of local and regional government in the European Union’s decision-making process. That has not only taught me a lot about how sub-state government works in the rest of Europe, but shown me forcefully the importance of a strong and healthy local democracy in those parts

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of Europe that did not enjoy democratic government for most of the last century. I want to concentrate on local democracy today.

When I was a new, young councillor a long time ago, the Conservative leader of the then Association of Metropolitan Authorities—who happened also to be a Sutton councillor—told me that there were only two parties. I thought immediately that this was yet another go at the Liberal party. In fact it was not; he meant the central government party and the local government party. Thirty years on not a great deal has changed. In spite of all the fine words about central-local partnership, the signing of concordats, and so on, central government still has a remarkable unifying effect on all parties in local government. That is because actions speak louder than fine words. The reality, so often, is that central government still sees local government as little more than its delivery arm. Local democracy really means not much more than local administration. This is very well illustrated by at least the first part of what I call the “local democracy and a few other things” Bill. We are all struggling to find a title for it. Maybe we will have solved that problem by the end of the process that will begin next week.

Back in the 1980s some Labour councils adopted their own foreign policy. Indeed, there were times during the past eight years as a Member of the Greater London Authority when I thought I was back in the 1980s. Of course, councillors are politicians; they will have political views about foreign policy and many other national issues, and they have the right to express those views. However, nobody would now argue that the councils that they run should have policies on international issues and their own foreign policy. Those are clearly outside the scope of those councils’ responsibilities. Now it seems that the situation is almost exactly reversed. Of course national politicians have views about community empowerment local democracy and the right to express those views, but it is not the role of central government to legislate on local councils’ approach to community empowerment.

Just as local councils should not get involved in issues outside their jurisdiction, central government should concentrate on the things that only national Governments can do. I have learned over my 30 years in local government that Governments always legislate for the small minority of worst-case councils. I judge legislation not by what it will do for the worst, where almost anything will be an improvement, but what it will do for the best councils. Like most local government legislation of the past 30 years, that proposed for this coming Session will do little or nothing to make the best councils even better.

There is no greater believer than me in the devolution of power, but that is a top-down process. It is necessary because we live in one of the most centralised states in the democratic world. My greater passion is for subsidiarity, a word which my spellchecker does not recognise. It is sometimes a word that I do not think central government recognises either. It means that decisions are taken nearest to the people they affect: a truly bottom-up approach. Of course, it is a dream.

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Last year, I had a view of what that dream might be like in reality. I was talking with a Minister in the Basque Government. He told me that, as an autonomous region in Spain, they collect 100 per cent of the taxes payable in their region. They then make a grant to the Spanish Government for the services that only a national Government can provide. For a few moments I had a vision. I had a vision of government Ministers clamouring every December for a meeting with me to explain that my council’s generous grant to them was simply not enough. Of course it was a dream, but if the Government are serious about local democracy and community empowerment, they need to apply the subsidiarity principle beyond just the EU and its member states.

Community empowerment does not need legislation; it needs political will and understanding. Above all, it needs central government to let go—to trust people and their elected representatives, and to let them do it in their own way. It is a dream, but 40 years ago, another man had a far more famous dream. I live in hope, but not in expectation.

7.12 pm

Lord Whitty: My Lords, the Minister made a pretty good fist of imposing a degree of coherence on this debate, but the reality is that we have a rag-bag of Bills being discussed today and a rag-bag of departments represented; therefore, we can all choose what we want to talk about.

I will not cause the Government too many problems tonight. I could have talked about local government, in which case I would have found myself largely in agreement with the noble Lord, Lord Tope, or I could have talked about agriculture, in which case I would have approved of most of what the noble Baroness, Lady Shephard, said. Even on transport, I would have to agree with the noble Baroness, Lady Warsi, on the third runway, rather than my noble friend Lord Soley. However, I will focus on climate change, and maybe a bit about housing.

Even in those capacities, I must declare a few interests: my chairmanship of Consumer Focus, my interest in the energy field, and as a board member of the Environment Agency. In that capacity I also welcome the long-awaited marine Bill. I may not agree with every aspect, but I support it. I think that I will also probably be able to support the floods and water Bill, although parts will need clarifying.

On the role of energy in climate change, I have welcomed the creation of the new department that the noble Lord, Lord Hunt, represents, among other departments that he represents in this House. I welcome the initial statements, including the speech yesterday by the Secretary of State, Ed Miliband. I also welcome the recent Ofgem probe, in which it recognises for the first time that there are a few problems in the market, particularly for the less well-off and more exposed portion of consumers. At this stage, energy prices should be coming down. They went up very rapidly last year, and have come down quite rapidly in the wholesale market. In the retail market, however, “coming down” seems to be lagging a lot more than “going up”.

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I am equally concerned about the structure of the tariffs that people pay for their energy. The tariff structure should not mean that the poor pay more, but they do. It should not mean that you pay less for every additional unit that you consume rather than more. The present structure is both environmentally daft and socially regressive. It behoves the Government and the regulator to take more seriously a root-and-branch review of the tariff structure. I hope that the new Secretary of State has that in his sights.

Despite the current fall in wholesale prices, it is also almost certainly true that the medium to long-term trend of energy prices will be upwards. Incidentally, the same is probably also true of food prices, which went up and down over the past 12 months, partly for the reasons indicated by the noble Baroness, Lady Shephard. It is also true that carbon-based energy prices going up should be a government policy objective, in order to drive behavioural change in businesses and individuals. However, we must reconcile a better deal for consumers with the environmental imperatives of reducing the carbon content of our energy and the use of energy as a whole. None of the present government interventions, whether through the trading scheme, where the actual price of carbon has gone down from €30 to about €16, or through the interventions in ROCs and CERTs and other incentives for renewable energy that give different implied prices of carbon, is high enough or sustained enough to drive serious change in the use of energy.

If we accept that the average price of carbon-based energy should go up as part of the climate change policy, we must also ensure that the cost does not fall unduly on the poorest. Currently, as the Ofgem study indicated, people who use pre-payment meters, who are off the gas network, who operate on standard credit—as most pensioners do—or who are small users of energy pay significantly more per unit than larger users.

We must offset a medium-term trend of a rise in energy prices through a robust commitment to a proper social tariff, so that the social tariff really is the lowest price that each company offers. We must enhance our energy efficiency measures and ensure that we have a coherent move to a lower-carbon energy base. In this context, unlike some in the environmental movement, I support the reinstatement of a commitment to nuclear power and welcome the imminent renewable energy strategy, which we will no doubt debate in this House. I also support some of the concessions that the Minister made during the passage of the Energy Bill on the feed-in tariff for distributed energy. I hope that the concession on heat strategy also bears fruit for low-carbon and low-cost energy.

We must redouble our efforts to improve the energy efficiency of buildings—all buildings, including the government estate—and particularly housing. This is true of both retrofitting existing housing and ensuring that building standards are of the highest quality for future energy efficiency, and any refurbishment in the successor to the decent homes programme in social housing.

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