Climate Change Bill [HL]

I make it clear at the outset that we are not afraid of being held accountable for each year of progress that we seek to make. Furthermore, the Government have absolutely no control over about 50 per cent of emissions from the UK economy, yet nobody seems to take any account of that in how we are to measure these things and to be accountable. In reply to the noble Earl, Lord Caithness, the point that my noble friend referred to on 11th December was that references to binding annual targets were not suitable. I am not arguing about what any of the scrutiny committees have said, but none of them came forward to require such targets. However, they looked at other aspects of this important issue, and we do not seek to run away from it. We think that the Bill has strong mechanisms—we will come to them in Clauses 28 and 29—to make sure that the government of the day are, importantly, annually held accountable to Parliament, on the basis of the expert and independent assessment of the Committee on Climate Change. The independent scrutiny that that will provide, on an annual basis, will strengthen the accountability for achieving emission reductions each year in every five-year budget. Therefore, we are not seeking to have the issue swept away for five years with no scrutiny and nothing done about it. If the Committee on Climate Change reports that, in its expert view, the UK is not on track to meet the budget, we would expect the Government to do everything possible to get back on track so as to satisfy the committee—and, moreover, to be under intense pressure in Parliament and in the court of public opinion. That is absolutely crucial. Annual scrutiny will help raise expectations that concerted action will be taken throughout each budget and, it is hoped, increase the confidence that the budgets will be met. We remain opposed to annual milestones or targets because we do not think that they would work in practice. I want to give four reasons and some detail as to why that is the case, because it is important for the next stage. First, there are annual natural fluctuations. Emissions go up or down by a small amount each year, depending on the weather. The noble Lord, Lord Redesdale, recognised that point in moving the amendment. During a five-year budget period, the fluctuations will, or are expected to, average out. We also have to ask ourselves whether proposals for annual milestones or targets will help the credibility of the system that we are setting up under the Bill. Would it help to have a debate each year on why the UK was, say, 0.2 per cent above or below its annual milestones and whether this was because the Government were doing well or because the weather was abnormally warm or cold that year? Such a debate would be irrelevant. Secondly, annual milestones and the political pressure to meet them could lead to huge pressures to rush through costly policies in a year, or particularly late in a year, with the aim of achieving short-term emissions reductions to ensure that targets were met. However, those policies might not be sensible from the economic, social or environmental points of view and could prove to be a distraction from the long-term decisions that need to be taken to put us on a trajectory to the 2020 targets and beyond. For example, would the Government of the day be expected to put up the cost of heating fuel in October to help to meet our annual targets? If not, what alternative measures could be taken late in a year to try to meet the milestones? One has to look at this from the practical point of view of the sequence of when information on which to judge performance becomes available. This would be the case even if there were no obligations on the Government to meet annual targets—in other words, if the targets were merely indicative. The same argument would apply regardless of whether the targets were set milestones or were legally binding. Thirdly, even if the Government of the day wanted to set annual milestones, they would simply not have enough information on which to base a decision. Even with the best will in the world, definitive information on emissions in a given year is not available until well after the year ends, as I think noble Lords will accept. The Government of the day would learn that they were off track for a given year only when it was already too late to do anything about it, unless it were the Government’s intention to buy credits each year. I am sure that such an issue would be controversial, bearing in mind the reference to it during our first day in Committee. Finally, as I pointed out, proposals for annual milestones do not recognise that the Government have no control of the annual emissions from 50 per cent of the UK economy. The European Union Emissions Trading Scheme covers half the UK’s CO2 emissions, including sectors that are more responsive to price signals. However, within the European trading system, companies are completely free to phase their emissions however they like during the five-year period. It is simply not possible for the Government to influence this and decisions will be based more on the carbon price across Europe. Again, how would that be taken into account in assessing our progress against the milestones? These are not intellectually stunning arguments against the principle; each one is a practical concern if we are to legislate for scrutiny. Those who are scrutinising the Government, here or elsewhere, will want something that they can genuinely measure the Government’s performance against. These are practical issues that I bring to the Committee. Perhaps I may make a couple of points about other amendments in the group. Amendment No. 76 would require the Government to ““have regard to”” their annual statement of emissions, provided for in Clause 12, when setting the indicative annual targets. There would be a serious practical difficulty with that. Final emissions figures are available on 15 January—one year and 15 days after the end of the year in question. Final detailed figures are available on 15 March. The information required would simply not be available in time. I realise that that is not an argument for doing nothing or for not having annual scrutiny, but I am making a practical point about how you change what has happened in one year and how you account for it. I have a couple of paragraphs on the amendment tabled by the noble Lord, Lord May, which I think are worth using, even though the noble Lord is not here. Obviously colleagues will take this away and have a look at it for Report. Amendment No. 31 would help by providing additional information on the causes of any fluctuations in annual emissions. We sympathise with the noble Lord in his efforts to address a problem that is not addressed in the Liberal Democrat proposals or in the group of Conservative ones to which we shall come shortly. However, we are not convinced that the proposals of the noble Lord, Lord May, would entirely address the problems. They would help but they would not entirely address them. There might simply be a new debate about the accuracy of the methodology used in adjusting emissions to take account of temperature fluctuations. The amendment would also not address the other, practical problems of the annual milestones that I have set out. As I said, we are not at all afraid of being held accountable for each year of progress, but that has to be done in a practical way. Those who are checking on the Government need a target or a figure or a means of scrutinising, so that it is not just a case of them saying each year, ““We wish you had done better””, and the Government saying, ““Haven’t we done really well?””. They have to be measured against something. That cannot be done in the way proposed by this group of amendments.