Climate Change Bill [HL]

My Lords, what came into my vision was the inability at one general election of the Liberal Democrats to explain their policy on local income tax; the idea of them trying to explain their policy on this at an election before the Liberal Government come in almost borders on preposterousness; but there we are. I am grateful to my noble friend for returning to this matter. It is not straightforward. My view is that it would be a rash and brave Minister who sought to introduce personal carbon allowances through this Bill at any time. I can imagine the debates and difficulties of doing so through secondary legislation; that is a complete non-starter. I say that as a parliamentarian rather than as a Minister. My noble friend asked a key question: if we are not going to do this through the Bill, why do we not use specific exclusion? There is an answer to that. When we dealt with this in Committee, my noble friend Lady Morgan of Drefelin set out the Government’s position: that we do not envisage using the powers in this Bill to introduce a personal carbon trading scheme, but we are, as is known, in the process of gathering evidence better to inform us on the whole issue of personal carbon trading. One can see how complex that would be if one wants to go down that road; all the issues raised by my noble friend and others would have to be covered. We would prefer not explicitly to rule out personal carbon trading for now—in relation to this Bill—for two main reasons. The first is that the initial pre-feasibility work has not yet reported; and the long-term framework of the Bill means that personal carbon trading in future may represent a useful tool. That involves the Bill’s long-term framework. In no way do I imply that the Bill will be used to do that but that long-term framework may give birth to other bits of primary legislation; there is no question about that. The second concern with this amendment—or any other amendment that is intended to rule out personal carbon trading—is that it might inadvertently have a broader effect. Personal carbon trading is a difficult concept to pin down, as we discovered in our short debate, and doing so in legislative terms would be incredibly complicated. If we tried in the Bill explicitly to exclude it we might in addition mistakenly exclude something else that we would not want to exclude. For example, the focus on individuals in this amendment may result in a business, which happened to be trading as a sole trader, being excluded from a trading scheme that was not in fact a personal carbon trading scheme. In the proposed carbon reduction commitment, participants will be identified on the basis of their electricity consumption. If this amendment were accepted, there is a risk that a sole trader could be exempted from the carbon reduction commitment. We also understand the concern in many quarters about the potential for personal carbon trading to be introduced through secondary legislation. It is a major concern but, as far as I am concerned, it will not happen. As I said, it would be a brave and also a rash Minister who sought to do that. That is not to say, because of the long-term nature of this Bill, that there cannot be a connection. The framework of the Bill goes to 2050 and therefore these issues will have to be debated. However, we have stated consistently that we do not intend to use the powers in the Bill to introduce personal carbon trading. I make it absolutely clear that personal carbon trading will not be introduced through the Bill. In addition, the Bill contains significant checks before a new trading scheme can be introduced—obviously the provision is there for trading schemes. These include the thorough parliamentary scrutiny and the affirmative procedure required for every new scheme, as well as consideration of the advice from the Committee on Climate Change. The pre-feasibility study is a concern for some noble Lords. This study aims to answer some key questions surrounding personal carbon trading and is expected by Ministers in the spring. Decisions will be taken then on the next steps. At any time, if this became a question to be seriously addressed, the Government would not envisage the introduction of such a scheme without a comprehensive period of public engagement, debate and consultation. As we have heard in the debate, in the examples given by noble Lords, this goes beyond anything that is actually in this Bill. That is why we do not want to exclude it, particularly in the way it is drafted. I am not nit-picking about the technicalities of the amendment. If you are going to do anything about personal carbon trading in the context of this Bill, it may have consequential side effects that would be unfortunate and that we do not envisage. I have given a clear commitment that personal carbon trading, in the sense understood by my noble friend, will not be introduced as a result of this Bill.