Intergovernmental Panel on Climate Change (Hansard, 21 April 2004)

§ Baroness Farrington of Ribbleton
My Lords, we are satisfied that the economic and statistical work of the IPCC is the most comprehensive assessment available. We note that it represents consensus between governments based on careful analysis.

§ Lord Taverne
My Lords, does the Minister agree that forecasts of global warming depend not only on scientific forecasts but on economic forecasts? Is the department aware that some extremely pertinent criticisms have been made of the special report and emissions scenarios by two very distinguished economists—Mr Ian Castles, the former head of Australia's Bureau of Statistics, and Mr David Henderson, the former head of the economic division of the OECD? They point out that the measure used—the market exchange rate—is quite inappropriate for measuring the difference between rich and poor countries: it exaggerates them. Some questionable assumptions are also made about the rate of closure of the gap between rich and poor nations.
As that will affect policy and is very important in relation to future policy, will the Minister urge her colleagues at the Treasury to get involved in the process of economic forecasting? At the moment something is very wrong.

§ Baroness Farrington of Ribbleton
My Lords, I am sorry that I cannot agree with the basic premise of the noble Lord, Lord Taverne. The result of the report and the views expressed by Mr Castles and Mr Henderson were considered extremely carefully both by the Government and by the IPCC. I note the noble Lord's view about the MEX form of analysis as opposed to PPP.
The difficulty that everyone has is that we are inevitably in an imprecise area because we are looking at long-range forecasting over the next century. However, we owe it to future generations to ensure that we err on the side of caution. The noble Lord's reference to Castles and Henderson would lead us in the direction of perhaps being far too laid back in our attitude towards the future and of failing to take steps now with devastating environmental results.

§ Lord Lawson of Blaby
My Lords, I realise that the Minister did not know that she was going to be answering this Question, but might it not be more sensible to lean in the direction of truth? Is she aware that the noble Lord, Lord Taverne, has put his finger on what is potentially a major scandal?
Under the flawed proceedings of the IPCC even the lowest emissions scenario, which leads to the lowest extent of projected global warming, is based on a rate of growth of the developing countries in the coming century that is far faster than has ever been known. As a result, by the end of the century under its projections, the average income of Algerians, South Africans and North Koreans will be higher than that of the citizens of the United States. Is the noble Baroness really content that this very important matter on which major policy and public expenditure decisions have to be taken should be left to what is little more than an environmentalist closed shop that is unsullied by any acquaintance with economics, statistics or, indeed, economic history?

§ Baroness Farrington of Ribbleton
My Lords, never for a moment did I believe that one day I would challenge some of the assumptions of the noble Lord, Lord Lawson. I cannot agree with him. Very careful consideration has been given to the methodology that is to be used. I think that the noble Lord is in error in some of the points he makes. It is extremely important to recognise that once, for example, Castles and Henderson complained about the methodology, they were given an opportunity to express their views. It is not a closed shop of environmentalists; it is people who are taking very seriously the future of the planet. One has only to look, for example, at the rate of growth in China to see that there could be grave errors in switching the methodology in the opposite direction.

§ Lord Tanlaw
My Lords, the noble Baroness mentioned that the intergovernmental panel covered a whole century. Has it seen the latest from some scientists who have reported alarming change in the circulation of the Atlantic currents, which, from the sediments of the Antarctic that have been checked, means that global warming could create global freezing in a matter of a few decades rather than centuries? Any approach should surely be flexible to take those new factors into consideration. Has the intergovernmental panel done that, or is it still a little behind on the scientific facts?

§ Baroness Farrington of Ribbleton
My Lords, I think that the noble Lord, Lord Tanlaw, is speaking in support of the Government's position. The implications of the rate of change to our planet are so serious that the Government are committed to continuing to be very cautious about listening to those of whom the noble Lord, Lord Lawson, spoke who say that we are taking the matter too seriously and assuming the worst. The noble Lord, Lord Tanlaw, is right in his assertion that we must look with a degree of alarm, be prepared and ensure that British industry and activity are in a position to benefit from low-carbon economies and related research, which will give them opportunities to help other countries.

§ Lord Desai
My Lords, does my noble friend not agree that whether one takes one measure of GDP or another is very much a matter of taste? After all, nobody pays their bills in purchasing power parity; they pay it in real money, which is based on market exchange rates. Does she not also agree that there is no evidence that measuring income in purchasing power parity will have any different environmental impact from measuring it in market exchange currencies?

§ Baroness Farrington of Ribbleton
My Lords, my noble friend Lord Desai is right; purchasing power parity is not necessarily a better method of assessing the environmental impact of growth rates. The other extremely important point about market exchange rate methodology is that data are available for much longer periods. When looking to development over the 286 next century it is important that both methodologies are used, which is what the IPCC in its wisdom has opted to do.

Lord Campbell of Croy
My Lords, are the Government concerned about forecasts that the melting of ice near the poles will lead to flooding from the sea in low-lying coastal areas in various countries? Are they taking precautions where the United Kingdom is affected?

§ Baroness Farrington of Ribbleton
Yes, my Lords. work is being done on the potential effects of environmental changes, including changes in water levels. The various government departments, particularly government agencies, are looking at the matter with care. The noble Lord will know that the response to an issue can be extremely sensitive, as a current issue in Devon is proving. It is extremely important that we look at such issues and do all that we can to mitigate any damaging effects, as well as seeking to tackle the causes, which is what lies behind the initial Question of the noble Lord, Lord Taverne.