Queen’s Speech

My Lords, I, too, congratulate the right reverend Prelate the Bishop of Lichfield on his excellent maiden speech, which mixed a certain charm with a definite edge. He is a major addition to your Lordships’ Chamber. I will comment on the Government’s programme to combat climate change. It was good to hear some significant additions to this programme in the gracious Speech and discussed by my noble friend Lord Adonis. It has also been good to hear the topic mentioned so substantially in the speeches given to date. We should recognise how important it is to keep the pressure on. The Climate Change Act and the Energy Act have deservedly won plaudits, but they are largely projects for the future. They do not reflect current reality, which is that in many respects in this country we lag way behind the avant-garde states, such as Sweden, Denmark and Germany. In terms of the proportion of energy delivered by renewables, for example, we are near the bottom of the league of European Union countries. A sharp and steep rise in the proportion of energy delivered from renewable sources is a prerequisite to meeting our targets for greenhouse gas reductions. However, I stress that there are quite serious mistakes made on this issue in a good deal of the literature on climate change. These mistakes are also contained in some government literature. It is often suggested that delivering a certain proportion of energy from renewable sources will, ipso facto, deliver a similar reduction in greenhouse gas emissions. This premise is false. Much depends on what happens in the rest of the economy. It is possible for a country to have a high or increasing proportion of energy come from renewables and, at the same time, for greenhouse gas emissions there to rise substantially. A good example of that is Spain, which gets a higher proportion of its energy from renewables than Germany does, but where, over the Kyoto period from 1990, greenhouse gas emissions rose by around 14 or 15 per cent. The reason for this is the significance of the building industry and of tourism in the make-up of the Spanish economy. From that, it follows that we must target not just production but consumption. It is not enough to concentrate on delivering a high proportion of renewable energy sources in the energy mix. In my eyes, the best recent publication to raise this issue—and to deal with it, if I might say so, very adventurously—is from the Sustainable Development Commission, which has produced a number of publications. The most important of those came out in the form of the book Prosperity Without Growth?, produced by Professor Tim Jackson. That came out just this year, although the reports that gave rise to it were produced some years before. The work of Tim Jackson and the Sustainable Development Commission makes it clear that we must target consumption. In other words, lifestyle change is an absolute prerequisite to reducing overall emissions within the economy. The work of Tim Jackson fits neatly with the report produced for President Sarkozy in France. A number of prominent economists, including Professor Joseph Stiglitz, worked on that commission, which provides a means of measuring welfare over and beyond GDP. A core contribution of the Sustainable Development Commission’s work is simply to pose the question—and to try to answer it in a fairly detailed way—of why simply measuring welfare in GDP terms will not do. What is the point of the endless piling up of GDP if it does not increase human welfare? We know that, in many circumstances, it actually reduces overall human welfare. Lifestyle change is therefore a prerequisite of climate change policy and I have some questions for all three political parties here about that. It is a myth to suppose that lifestyle change can be produced largely through persuasion. Many people use anti-smoking campaigns as a way of showing what could be done, in producing lifestyle change through persuasion, to persuade people to reduce their greenhouse gas emissions. Smoking is, however, not a good example; it took some 30 years to make significant changes and, even today, about 37 per cent of the population in this country still smoke. My recipe for lifestyle change is like the motto of the suffragettes, which, it might be remembered, was "Deeds, not words". Deeds are what will change public opinion. To me, taxation is the main means that has been demonstrated to change behaviour. If you compare, for example, average fuel consumption in the European Union countries with that of the United States, you see that fuel consumption in the EU is about half that of the US. Why? Well, it is simply because there is much higher fuel duty in Europe than in the United States. The work of the Green Fiscal Commission is important on this issue. Noble Lords will probably remember that the commission suggested that green taxes should rise from about 7 per cent, where they stand now, to 15 to 20 per cent by 2020. To me, that is not radical enough; we need much more fiscal innovation, too. I close by posing three questions to all three Front Benches. One must take seriously the fact that climate change is not a party political or a left/right issue. Therefore, we need to sustain important substantive political consensus on it. Will the Government and other major parties make a serious and committed response to the report of the Sustainable Development Commission? What would this response be like on a detailed policy level? Secondly, what strategy is envisaged for a serious move away from GDP as a measure of welfare? What strategies do the Government and the other two parties have to make a serious move away from GDP as a means of indexing the relationship between growth and welfare? Thirdly, in a speech that has been trailed, and I believe is being given, today by George Osborne MP at Imperial College, he says the following: ""I want a Conservative Treasury to be in the lead of developing the low carbon economy"." I commend him for that and for the other comments in the speech. My question to all three parties is: what prospects are there for a radical shift in taxation structures geared to reducing emissions in the relatively short term? I should like to hear a range of responses from the three Front Benches to these three questions.