Climate Change Bill

In welcoming moves to include aviation and shipping in carbon budget calculations, Nick Hurd calls on the Government to send a "powerful signal" by reversing the decision on Heathrow.

Mr. Hurd: I rise to give a cautious welcome to the movement by the Government on this important issue, but we must recognise the scale of the journey. We have moved from a situation, in summer 2007, when those of us on the Joint Committee on the draft Bill were listening to a Government who were saying, “We are filing the inclusion of aviation in the ‘too difficult’ box. We don’t need to do it because we aren’t required to by our international agreements.” The message from the Government in the Bill is now, “We’ll tell you if we’re going to include aviation and shipping in our international targets by the end of 2012, and if we do it, we’ll tell you then how we’re going to do it. On the way we’ll get some advice from the Committee on Climate Change and publish some projections.” The hon. Member for Northavon (Steve Webb) was right: there is no absolute obligation for the Government to include aviation and shipping in the carbon budgets or the targets, and we should be quite clear about that.

It has been a modest journey, but a welcome one. That is why the Bill needs toughening, and I extend a cautious welcome to amendment No. 72, tabled by the right hon. Member for Scunthorpe (Mr. Morley), who, sadly, is no longer in his place. It adds value by requiring the Government and the Committee on Climate Change to take into account aviation and shipping in their public deliberations. I am concerned that the phrase “take into account” is too vague, because it can mean anything to any Government—but there has been an improvement.

We recognise that there are tremendous difficulties in calculation—we have to respect that, and we must not get too far ahead of ourselves in the international process. But this Climate Change Bill is very important. It is a landmark Bill, which sets an international lead as a framework Bill. That is its value. It is a new method of setting targets and monitoring progress against targets. The key innovation in the Bill is not the long-term targets, but the carbon budgets. The rolling carbon budgets will allow us to get a grip on the problem of cumulative carbon emissions—a point forcibly made by my hon. Friend the Member for Beverley and Holderness (Mr. Stuart). It is the cumulative carbon emissions that count, not the absolute carbon emissions at the distant date of 2050.

The carbon budgets are the key innovation, and we simply cannot undermine them by leaving completely to one side the fastest growing source of emissions, however difficult it is to calculate them. We should take the opportunity to place on record the fact that aviation emissions in the UK have grown by 90 per cent. between 1990 and 2004. The Under-Secretary was unable to answer the question posed by my hon. Friend the Member for Beverley and Holderness about the proportion of future emissions in the carbon budget that the Government think will come from aviation, but she will be aware that there are various estimates from serious people such as the Tyndall Centre and WWF, and the range of projections is between 50 per cent. and 100 per cent. of our carbon budget in 2050. We have to address a serious engine of growth in carbon emissions, and we cannot afford the “out of sight, out of mind” message that we received from the Government 18 months ago.

As the Under-Secretary well knows, transport, and aviation in particular, is the most difficult in policy terms, partly because there is no obvious short-term technology solution. It does not take much for us to imagine that our children or grandchildren will be driving around in cars that are different from the ones that we drive in, and powered in a different way. We can almost feel the technology—it is out there. But in aviation that is not the case. The best-case scenarios for aviation are for technology products leading to improvements of about 1.5 per cent. a year, which is not enough, given the demand. We are left in very difficult political territory when making policy—having to decide whether we want to manage demand through price mechanisms, taxes or the management of airport capacity.

The Government are placing all their bets on the European emissions trading scheme—the cap-and-trade scheme. That makes me nervous, because in the Environmental Audit Committee we spend a lot of time looking at the emissions trading scheme. It works as a testing mechanism, but it has comprehensively failed to reduce emissions, because a cap-and-trade scheme is only as good as the cap, which is a function of political will. The great concern is whether there will be the political will in 2011, in the face of the mother of all lobbies from the aviation industry, to set a cap that bites. We know that such a cap will have significant implications for the price that consumers will pay for aviation. There will be significant consequences for the price of carbon credits in the system for other industries. This is an extremely difficult policy area.

Barry Gardiner: Would the hon. Gentleman agree that it would be possible to allow an expansion of the aviation industry, and shipping as well, as long as that was taken into account in the carbon budget, as he rightly stressed, with accommodations and increased cuts in those areas? That would, critically, demand that it be possible to quantify exactly what the amount of the contribution was; that was the central point made by the hon. Member for Beverley and Holderness (Mr. Stuart) earlier.

Mr. Hurd: Absolutely—we need to know what we are dealing with. The hon. Gentleman has painted a gentle and attractive scenario, but it places a lot of faith in the emissions trading system, which is attractive in theory but has not worked in practice, because too much political risk is tied up in it.
I was making the point that we cannot afford an “out of sight, out of mind” attitude to aviation and shipping, because the policy challenge is too great. It requires the Government of the day to get a grip on it, and the harsh reality is that this Government have been extremely clumsy in the signals that they have sent through their policies on aviation. We have had a clumsy increase in air passenger duty, which has given green taxes a bad name because it was closely associated with the concept of stealth taxes. We seem to be slow-marching towards the wrong decision on Heathrow. It was desperately disappointing that one of the first signals from a new Secretary of State in a new Department was simply to confirm that existing position on Heathrow. The Under-Secretary will be aware that it is hard to persuade those in this country, let alone any other, that we are serious about controlling emissions from aviation if we give the green light to the expansion of the fastest-growing source of emissions. The negative value of that decision far outweighs the relatively small value of the signals being sent in the Bill.

Mr. Graham Stuart: This is a question not only of aviation but of shipping. We are a major maritime nation, but little effort has been put in here, or globally, into finding out what the emissions from shipping are, let alone into the investment and leadership that Ministers like to talk about that is needed to transform the efficiency of shipping in terms of emissions. That is a very challenging process in aviation, but probably a lot less so in shipping. However, precious little effort or political will has been applied to that area so far.

Mr. Hurd: I accept that point completely. It is coming through in all the evidence received by the Environmental Audit Committee at the moment. The value of the debates on the amendments is to ensure that such matters are included in the Bill, so that the Government cannot ignore the issue.

John Hemming: Will the hon. Gentleman give way?

Mr. Hurd: If it is about oil, the answer is no.

John Hemming: It is about shipping.

Mr. Hurd: All right.

John Hemming: Does the hon. Gentleman accept that shipping is one of the modes of transport that, historically, operated without any carbon emissions?

Mr. Hurd: I congratulate the Government on moving from an unsustainable position on the inclusion of aviation and shipping in our consideration of budgets and targets—but I say to the Under-Secretary that the most powerful signal they could send would be to review and reverse the decision on Heathrow.

6 pm

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NICK'S OTHER CONTIBUTIONS TO THE DEBATE

Mr. Nick Hurd (Ruislip-Northwood) (Con) : I congratulate the right hon. Gentleman on his amendment, which I support in principle. I note that the Government are minded to accept it, so I press him to define a little more tightly or expand a little on what he understands by “taken into account”?

Mr. Morley: There must be provision and planning, as there are for the 2012 time limit, to ensure that aviation and shipping are taken into account and included in carbon budgets. Lord Turner’s committee acknowledged that, although he recognised the current difficulties with agreeing international methodology and getting international agreements. It is imperative to achieve those and I hope that that will happen by 2009, when the all-important forum of the United Nations climate change convention at Copenhagen takes place. To fail to secure international agreement would be a global disaster. However, including such elements in the Bill demonstrates that the Government are serious about the matter. They are giving a clear lead to the rest of the world that those elements must be included if we are to move to a low-carbon future.

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Mr. Hurd: The hon. Gentleman started his speech with the premise that the Bill places no absolute requirement on the Government to include aviation and shipping in the budgets or the targets. That is correct, but I have struggled to follow how his new clause 14 would change that. I can see that it might improve the transparency of some of the information going into the mix, but it does not change the basic premise of his argument, does it?
Steve Webb: As the hon. Gentleman rightly says, our new clause 14 would require projections on aviation and shipping that would otherwise not be made, which would deliver an impact assessment on the rest of the economy. As he knows, our concern is about the actions of future Governments. The consequence of our proposal would be for other sectors of the economy to exert more pressure to include aviation and shipping, because it would be much more transparent that they would take the hit. That would be an indirect way of bringing pressure on future Governments not to neglect the other sectors of the economy.