HC Deb 08 July 1997 vol 297 cc798-806

"After section 55(3) of the Local Government and Housing Act 1989 there shall be inserted— (3A) In determining the amount of a supplementary credit approval the Secretary of State shall have regard to the strategy of the authority to implement a programme of investment in energy efficiency measures.".'.—[Mr. Yeo.]

Brought up, and read the First time.

Mr. Tim Yeo (South Suffolk)

I beg to move, That the clause be read a Second time.

I shall follow the precedent established by my hon. Friend the Member for Christchurch (Mr. Chope) in moving new clause 2 and show the House that I wish to be helpful. I believe that the inclusion of a reference to energy efficiency in the Bill will strengthen it greatly.

Energy efficiency is widely, perhaps universally, recognised as a desirable goal. It is one of the few areas where environmental and economic aims coincide. Greater attention to energy efficiency improves the environment, saves money and can, under certain circumstances, create jobs—at least on a temporary basis. Partly because of the lack of controversy surrounding the subject, the issue has become rather unglamorous. It does not attract as much political attention as is justified.

Against that background, I am surprised that the Government did not include something like this new clause in the original draft of the Bill. Their failure to do so is part of a consistent and regrettable pattern. As with so many other environmental goals, the Government claim to support energy efficiency. Labour Members have referred to the subject many times in speeches and have used line phrases at home and sometimes abroad. However, there has not been much action—and there was no action at all in the Budget last week. A Treasury press release promised to examine options to help people on low incomes to insulate their homes and save energy. A promise to examine options does not add up to much—particularly when it is set alongside other Budget measures, which include a powerful incentive to increase energy consumption in the form of a cut in value added tax on domestic fuel prices. On 4 December 1996, the then Labour spokesman on environmental issues, the hon. Member for Lewisham, Deptford (Ms Ruddock), said: each year we will publish a 'green book' alongside the Chancellor's Red Book, setting out the environmental implications of Government policy."—[Official Report, 4 December 1996; Vol. 286, c. 991.] No such green book appeared, because Ministers knew that it would expose the Government's gross failure to honour any of their environmental obligations. They knew also that it would expose the fact that the net impact of the Budget measures might well be to increase carbon dioxide emissions.

Such an impact is in unhappy and stark contrast to the fine phrases used by the Prime Minister when he addressed the Earth summit in New York a couple of weeks ago. Perhaps the hon. Lady's commitment was the reason why she was not appointed as Minister of State, Department of the Environment. Perhaps she was shuffled off to the sidelines as a warning to other Labour Members not to make commitments of that sort.

When the Minister for London and Construction replies to the debate, will he make it clear that the Government intend to make amends by publishing the "green book" that the hon. Member for Deptford promised last December? If he does not, should the House take it as a sign that new Labour, like old Labour, does not give a stuff about the environment—that this is just another pre-election promise that can now be junked, like the promises on pensions, the national health service and on tax? Every one of those promises is now worthless. They were given merely to win votes and are now forgotten.

We are left with the Chancellor's promise that the Treasury will report to Parliament in October about the effect of a reduced rate of VAT on energy efficiency materials. However, we do not need to wait until October to know that cutting VAT on energy efficiency materials will encourage investment in energy efficiency. In that context, I draw much encouragement from the comments of the Minister for the Environment—I am sorry to see that he is not in his place for a debate that touches directly on his responsibilities. The right hon. Gentleman succeeded the hon. Member for Deptford, and is now the Minister with responsibility for environmental matters.

As recently as last week—unfortunately for the right hon. Gentleman, it was the day before the Budget—he answered a parliamentary question about the need to levy VAT on energy-saving materials at the same rate as VAT on fuel prices. The right hon. Gentleman said: I am certainly on record as supporting that argument. Such a policy is desirable".—[Official Report, 1 July 1997; Vol. 297, c. 90.] When the Minister replies to the debate, will he confirm that he shares the view expressed by his ministerial colleague? Will he confirm that he and his right hon. Friend will resign from the Government in October if the Treasury report does not support their view or will he merely confirm that his views on this issue, as on all other issues, are of no consequence whatever to the Treasury? [Interruption.] That seems to cause great mirth on the Government Front Bench. Will the Minister confirm that, in this Government, the Chancellor and the Treasury are all-powerful, and that the Treasury does not care about either his views or the environment?

Last week, the Deputy Prime Minister pronounced on the purpose of the Bill in the context of a press release that was issued with the Budget papers. He set out in two paragraphs the purposes to which the resources that he claims will be released by the Bill will be applied. In that press release, the Deputy Prime Minister did not see fit to mention energy efficiency in a single phrase.

That was yet another missed opportunity for the Government to pay even lip service to environmental goals and another sign of their priorities. There are no public spending implications in mentioning energy efficiency in a press release. I am forced to conclude that Ministers mention energy efficiency only when they are attending events such as the Earth summit. As soon as there is a chance to do something, they quickly forget their commitment to green objectives.

5.30 pm

I have come to the rescue with the new clause tabled by my right hon. Friends. It gives the Government a chance to rectify their omission and reward those local authorities that show that they, unlike the Government, take energy efficiency seriously—local authorities that run their estates with energy efficiency as a priority; local authorities that provide buyers of council properties with information about energy ratings; local authorities that encourage private sector owners and tenants to invest in energy efficiency improvements. The new clause offers the Government a chance to reward authorities that are enthusiastic in implementing the Home Energy Conservation Act 1995, to which many are responding well. The laggards should be encouraged to catch up. Why are Scottish local authorities being given an extension in the timetable within which they must report under that Act?

The new clause would benefit all local authorities that are willing to do what the Government will not do—act to promote energy efficiency. It would give local authorities with less good records on energy efficiency an incentive to improve. If the Minister is unable to welcome the new clause whole-heartedly and accept it, will he say whether energy efficiency considerations will play any part in determining the way in which supplementary credit approvals are allocated? What specific steps do the Government propose to encourage local authorities to invest in energy efficiency measures? Do the Government agree with the recommendations of the 1993 Environment Select Committee report on energy efficiency?

Mr. Raynsford

I was on the Committee.

Mr. Yeo

The hon. Gentleman has remembered. I remind him of recommendation 53, which said: We also recommend that the Government revise the system of capital controls to provide an incentive for energy efficiency by extending the current capital receipts spending 'holiday' to enable local authorities to fund approved energy efficiency and CHP projects. Does the Minister still agree with that unanimous report? If he is unable to accept the new clause or finds it difficult in any way, he would cause himself much less embarrassment by recommending that his hon. Friends vote for it.

Mr. John Gummer (Suffolk, Coastal)

The Government must think seriously about the problem resulting from the arguments in New York. The United States does not believe that Britain is serious in its determination to reduce our carbon dioxide emissions by 20 per cent. by 2010. It is using that as an excuse for taking no action.

I have asked the Government several questions about what they intend to do. The answers have been somewhat confusing. When I asked how much of the reduction industry would be expected to bear, the Department of Trade and Industry said that it did not know, but that it was thinking about it and was hoping to estimate the figure, which it would no doubt tell us.

In the Budget, the Chancellor of the Exchequer appeared not to have worked out how much more had to be done because of his changes to VAT. He did not have a figure in his mind of the extra emissions that might occur because of the cheapening of fuel. That is a worry. When the Government make such decisions without the facts and suggest that the House should wait until October before we have the facts, it is hard to believe that the Chancellor and the Treasury are taking global warming as seriously as I had hoped they would or as seriously as I believe the Prime Minister suggested they would.

The Minister for Local Government and Housing has smiled at every suggestion that has been made today. I hope that she will listen carefully to me now.

If the Government do not support the new clause, what are they saying? They are saying that they will not take into account the strategy of any authority to implement a programme of investment in energy efficiency measures. They will ask the House to vote against taking that into account. That does not seem to sit squarely with what the Prime Minister said in New York or what the Government have been saying.

The hon. Lady is still smiling. She spends the whole time smiling. That is very happy for her, no doubt, but it suggests that she does not take such matters with the seriousness that they deserve—or that she does not understand them. I have begun to believe that she giggles because she does not understand and does not want to listen to the facts.

The Conservatives have agreed to support a bipartisan environment policy because we want to achieve the ends that the Government have said that they accept. In opposition, they did not help much. The two Ministers present today were not well known for coming to the aid of the Green party, but we have forgotten about that and we shall support them. However, we shall keep them to their promises. The Minister and those who flank her should remember this simple fact: if they say that they are going to reduce emissions, they must also say how. If they do not, nobody will believe them. Nobody believes the Government yet. I want to give them the chance to be believed about this—if about nothing else. It is the most important subject for them, because, if they get it wrong, the damage to future generations will be very severe.

Does the Minister for London and Construction recommend that the House should vote that the Government should not take into account the energy efficiency strategy of a local authority? If he suggests that we should not vote for the new clause, he will be asking the House to ask the Department to ignore that essential issue. The Minister for Local Government and Housing should take the issue much more seriously if the nation and, more importantly, the international community, are to take the Government more seriously. I despair of them taking her more seriously, but they would take the Government more seriously if they showed how they will deliver what we believe they want to deliver.

Mr. Andrew Robathan (Blaby)

I support the new clause. My right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) spoke lucidly about the need to deliver gains in energy efficiency rather than just talking about them. We have heard fine words from the Prime Minister. In general terms, I applaud most of what he said in New York, as does the whole House, but we need to see some action. My right hon. Friend the Member for Suffolk, Coastal said that the Government's answers were confusing. We all understand that putting VAT on domestic fuel was not a particularly astute move politically by the last Government, but it was a good stick with which to encourage people to use less energy.

If we are to reduce the effectiveness of the stick, we need to use a little more carrot to encourage energy efficiency. VAT on domestic fuel is now down to 5 per cent. What is the message from the Government? They cannot decide whether, at minimum cost, to reduce the rate of VAT on energy-saving measures and insulation. It is extraordinarily confusing. The new clause gives the Government the opportunity to benefit the environment by taking account of energy efficiency. It is a serious matter that does not deserve giggles from Ministers.

I am not making special pleading for my constituency, but for many years Blaby district council has had a fine record of encouraging energy efficiency in its own housing stock and elsewhere. Harborough district council has a similar excellent record. However, some councils need to be encouraged with a stick and a carrot. The new clause provides a marvellous carrot for local authorities to take seriously energy efficiency and implement previous legislation.

I am also involved with the all-party renewable and sustainable energy group, which takes a close interest in these matters. Hon. Members will have received today a communication from Greenpeace, an organisation with which I do not always agree. It is about solar energy being used in Silvertown in docklands. It is an extremely sensible piece of information. Under the new clause, the Government could further the use of solar energy in new housing stock and make an appreciable difference to the energy we use—and, indeed, the energy that we waste—and the carbon that we release into the atmosphere.

Although the previous Government were attacked endlessly by the Labour party, they had a proud record in those matters. The home energy efficiency scheme and the neighbourhood energy action scheme resulted in better insulation in the homes of 2 million old people. That makes a profound difference to their lives and to the energy used.

It is an absolutely vital issue. I applaud the new clause and support it whole-heartedly. The Government should consider it seriously and not just dismiss it with a giggle as being entirely irrelevant. It is a big issue that matters to a huge number of people. The Government have a chance to do something concrete about it and put their fine words into action.

Mr. Raynsford

New clause 4 would place a duty on the Secretary of State to take into account each authority's strategy for investment in energy efficiency measures when determining its supplementary credit approval. As I hope that we have already established in debating earlier amendments, the drafting of the new clause would extend its impact well beyond the distribution of additional resources under the Government's capital receipts initiative. It would apply to all supplementary credit approvals.

I welcome the hon. Member for South Suffolk (Mr. Yeo) back to the Front Bench, but I can see no compelling case for making a local authority's energy efficiency strategy a pivotal factor when a supplementary credit approval is issued for road safety purposes, firefighting, harbour improvements, flood defences or composting—possibly a subject of concern to some hon. Members.

Mr. Clappison

It is a serious subject.

Mr. Raynsford

Indeed, but it is totally irrelevant to energy efficiency in housing.

Mr. Gummer

Will the Minister give way?

Mr. Raynsford

I hope that the former Secretary of State will bear with me for a moment. He has jumped to his feet rather rapidly.

We are debating measures to give effect to the Government's commitment to release capital receipts for housing purposes, including energy efficiency measures. Had the Opposition prepared the new clause more carefully, it might have achieved their intended effect. However, they have produced a completely unworkable new clause that would produce absurd consequences, as I have illustrated. The former Secretary of State knows only too well that it would be ridiculous to try to take into account energy efficiency in the home when issuing supplementary credit approvals for other purposes.

Mr. Gummer

For 17 years, civil servants handed me precisely such answers. For 17 years I told them, "Take it away. I shall tell people that this is not the way to achieve what they want, but I shall tell them at the beginning that I want to achieve what they want and I shall make sure that we table an amendment to that effect." I have always told civil servants, "Don't tell me to make a cheap point across the Floor of the House. Let's deliver what we can do together."

Our new clause may not be properly worded. The Minister knows from a long time in opposition—he will soon learn again in the same circumstances—that these matters are not so easy in opposition, so will he please give an undertaking that he will ensure that the purpose of the amendment is achieved in a sensible way? If he does, we can all go home quite happy and leave the composting to composters.

5.45 pm
Mr. Raynsford

I shall give the right hon. Gentleman exactly the assurance that he seeks. Had he taken care to read our consultation paper, he would know that the Government intend to do exactly what he has requested. Perhaps, in the intervals of jetting in and out of New York and other places, the right hon. Gentleman might have taken the time to look at our proposals in more detail. Had he done so, he would have been better informed for tonight's debate.

Let me assure the right hon. Gentleman and other Opposition Members that energy efficiency is a central concern for the Government. It is a clear commitment. As the hon. Member for South Suffolk acknowledged, under the Home Energy Conservation Act 1995, local authorities have a duty to have strategies to make significant energy efficiency improvements in the domestic sector. Energy efficiency is already taken into account in the annual housing investment programme through which the Government distribute capital resources for housing to local authorities. The effectiveness or otherwise of those strategies will have a bearing on the resources allocated to authorities through the process that we are debating tonight.

Let me remind Opposition Members what is in the consultation paper that we have issued to local authorities. We make it quite clear that Expenditure under the capital receipts initiative should be directed at meeting local priorities consistent with the local strategy. Such works might include"— and there follow six headings, including improving the energy efficiency of local authority and private sector housing and reducing CO2 emissions". That is a clear commitment to energy efficiency that should at least have been acknowledged by the right hon. Member for Suffolk, Coastal who spoke about a bipartisan approach, but never misses the opportunity to make a cheap point.

Mr. Gummer

The Minister well knows that it is always easy for Ministers to read out their speeches, although I would have been pretty angry had any of my junior Ministers read out such a speech, which is clearly unamended. At least I hope that it is unamended. If the Minister has amended it, he clearly does not get the point.

We want the provision on the face of the Bill. Only then can we be sure that local authorities comply with it, If the Bill says "might" or "may" or "could" or "we might have purposes to see" in the same way as the consultation document that I have before me, it does not have the effect of law. I am asking the hon. Gentleman to promise that the provision will be on the face of the Bill. If he answers that simple question, we need not hear the rest of his speech.

Mr. Raynsford

Once again, the right hon. Gentleman reveals that he has not read the consultation paper. Paragraph 24 contains a clear statement of the mechanism that will be adopted to allocate resources under the initiative. Local authorities will be asked for detailed spending plans showing how they are taking account of the objectives that have been specified, including achieving greater energy efficiency. It states: The Government Office will advise Ministers on the merits of the proposed spending plans … Having given due consideration to this advice, Ministers may wish to vary the final allocations to individual authorities. There is a very clear mechanism for doing something about energy efficiency rather than talking about it.

The right hon. Member for Suffolk, Coastal may have heard the hon. Member for South Suffolk referring to the Environment Committee report of 1993. That report recommended—indeed, the hon. Gentleman referred specifically to the recommendation—that the Government of the day should extend the capital receipts holiday to enable local authorities to do more in the way of energy efficiency. Did the Government of the day, whom Conservative Members supported, follow that advice? No, they did not. They did not continue the capital receipts holiday; they ended it. They ignored the advice of the Environment Committee, which they now have the cheek to quote at this Government.

The Government are acting on the advice of the Environment Committee. We are releasing receipts under a capital receipts initiative which is designed to achieve precisely the energy efficiency objective among others.

Mr. Yeo

The hon. Gentleman, and not any Opposition Member present, was a member of that Committee, signed that report and made the recommendation—it was a unanimous recommendation of the Committee—which he now appears to want to reject.

Mr. Raynsford

On the contrary, as I have just pointed out to the hon. Gentleman, we are acting in accord with that recommendation. We are bringing forward the capital receipts initiative, we are making additional resources available to local authorities and we are saying clearly that energy efficiency is one of the objectives.

Of course, there are other objectives. We know of the problems of homelessness that the previous Government ignored. Action is necessary to deal with that. We know about the number of people living in rotten, miserable, poor conditions due to the failure of the previous Government to invest adequately in improving the condition of the housing stock. That is a priority as well. We are clear that energy efficiency is one of our objectives, and we are acting under the initiative to give effect to it.

Mr. Pickles

I am sorry that the Minister seems to be quite rattled on this subject. Perhaps I can bring him back to the central point. Will he explain why it is stronger and tougher on ensuring that energy efficiency is brought about to give discretion to Ministers rather then putting a provision in the Bill?

Mr. Raynsford

Sadly, the hon. Gentleman, along with all his hon. Friends, appears to have ignored entirely the fact that the new clause as drafted would be totally defective, as I have said. If he wishes us to put into effect ineffective legislation that requires the Secretary of State or Ministers to have regard to entirely irrelevant considerations when allocating supplementary credit approvals for other purposes, all I can say is that his party has learned very little over 17 years.

Mr. Pickles

rose—

Mr. Raynsford

No, I shall not give way. I have given way already.

In 17 years in government, Conservative Members entirely failed to learn one very simple lesson: to be effective one needs to have clear objectives, to state them and to have mechanisms for implementing them. The Government have clear objectives and a commitment to implementing them. We shall ensure increased investment, which will contribute towards increased energy efficiency: action, not words.

Mr. Yeo

I must, with regret, refer to—since Hansard will not report—the frivolity with which the Minister for Local Government and Housing greeted nearly all the comments made by Opposition Members during a debate about a very serious issue, to which the Government and the Prime Minister pretend consistently to pay lip service. When faced with it in the House, all the hon. Lady was able to do was giggle and make cheap points from a sedentary position.

As my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) pointed out, the Minister for London and Construction resorted to the oldest argument: to attack a new clause on the ground of its unworkability, some shortcoming in its drafting. I simply say that I hope that, in his own interests, he will not resort to that argument again when he deals with other matters in the House or in Committee.

My right hon. Friend the Member for Suffolk, Coastal exposed the yawning gap between the Government's proclaimed environmental objectives and the actual policies that have so far been announced. The Minister could have put matters right in his reply, but he totally failed to do so. He relied on the drafting of his consultation paper, which says that the purposes for which supplementary credits might be applied might include energy efficiency.

Given the Government's total disregard of the commitments that have been given in specific and unequivocal terms, I cannot be hopeful—nor can the House—that a commitment that is couched so vaguely in a consultation paper is likely to be honoured if it does not suit the Government at the time to do so. If the Government really intended to give energy efficiency proper priority, they would include it in the Bill, as I, my right hon. Friend the Member for Suffolk, Coastal and other hon. Friends have suggested.

I very much regret that the Minister has so cavalierly ignored the key arguments advanced in support of the new clause. He will not look back on his contribution to the debate with much satisfaction. However, in the interests of the House and of getting on to other important matters, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

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