All Party Parliamentary Climate Change Group Is a Cross-Party ...

initiative by writing to David Cameron spelling out areas
where we could, and in our view should, reach short-term
agreement, and hoping that he would be able to resolve some
of the inconsistencies which clearly exist within the
Conservative Party between what David Cameron and Peter
Ainsworth and other members of the Front Bench have been
saying, and then some disconnect which has existed, for
example, in the behaviour of, say, Eric Forth and Christopher
Chope towards the Climate Change and Sustainable Energy
Bill. We will not intrude on private grief. But, in response, I
should just say to Ming's initiative, David Cameron has
written to me asking for a meeting. I am delighted to say that
we have certainly agreed that. We are very much up for the
process of the cross-party agreement. I think a date for that is
being arranged. We are sceptical about the argument from
David Cameron, which he again put in his letter to me, that
he cannot pre-judge the deliberations of the Quality of Life
Policy Group chaired by John Gummer as he floated in and
out, precisely because it seems to us that all the parties are
going to have to come to some pretty clear decisions before
the time scale of eighteen months which is when the Quality
of Life policy group report. For example, we are dealing
with the Finance Bill at the moment in which the Chancellor
is announcing and trying to get through, first of all, a
restructuring of vehicle excise duty, which clearly has
climate change implications.
Secondly, very firmly, he is proposing a revalorisation of fuel
duty, and that has climate implications. Thirdly, he is
proposing a revalorisation in line with inflation of the
climate change levy. That has climate change implications.
We would, indeed, go beyond the restructuring of air
passenger duty and a broader commitment to reversing the
trend decline in green tax. But all of these things require, it
seems to me, a responsible Party to take a view ahead of that.
And, of course, we are going to have the Government's
energy review in this time scale as well. We certainly intend
to take a very clear line which, perhaps it will not surprise
you to hear, is going to be anti-nuclear on the energy review.
Ming will also raise at this meeting the procedural issue
concerning the cross-party agreement which calls for a
climate forum to discuss common ways forward. Clearly,
there is a difficulty here because we would like to discuss
specific measures, precisely because it is important to give
those signals to business in particular, but, if nothing can be
forthcoming from a key player in the political environment
for eighteen months, it is not obvious how we can make
progress in the climate forum until that point. Therefore, this
is clearly something which we need to sort out. So our view
of the cross-party agreement is that it should be designed,
rather like the cross-party views on Northern Ireland
historically, it should be designed to enable the political
system to deal, first of all, with the long-term issues,
secondly with tough issues where there is a potential for one
party undermining another in terms of their views if we get
into a collective race towards the soft option, and it is thereby
to ensure that parties don't attack each other for putting
forward responsible and sensible proposals which are
designed to deliver behavioural change and technological
change, or the mixture of the two that comes about to deal
with climate change. That is why we set out the five
principles on green taxation in the Queen’s speech. Perhaps I
should leave it at that to kick over to you in terms of
questions. But we feel very strongly. We want to back this
process. It is a useful process. I think what we signed up to
is very sensible in terms of the expert group to advise on
targets. I know that has been a subject of what you were
talking about earlier. Coming into this area as an economist
rather than an environmental ayatollah, I have to say that
there is clear precedent for this in the economic area in other
G8 countries. If we look at, for example, Germany where
there is a counsel of wise people that advises the Federal
Government on economic matters, not just the independent
Central Bank, and that provides a framework of expertise
from which it becomes more difficult for the Finance
Minister to depart without incurring a good deal of criticism
that he has ignored the expertise which is available and,
effectively, is involving himself in a race towards soft
options.
DR CLAYTON: So that would be a way of holding the
Government to account?
MR HUHNE: It is an important way, I think, of anchoring
the political process in what is the consensus or mainstream
technical advice. What you see again and again and again in
the economic field is when Finance Ministers get into tough
times, for whatever reason, unexpected downturns or
whatever, their natural optimism comes fully to the fore and
they start making ridiculous forecasts, assuming that they are
going to be able to resolve their problems by growing their
way out of them, getting high revenue growth, unexpected
cuts in public spending or whatever, and what that German
system does is to anchor the process in sensible assessments
from people who do not have any axes to grind. That seems
to me to be a very sensible read-across into the environmental
area. We need to do exactly the same thing.
Obviously we can have a debate, we will have a debate,
about means. I very much hope we can reach a substantial
consensus about means as well because I do not think it is
terribly useful to other players in the economy if we merely
have a consensus about targets and nothing else. We do need
to have a consensus on taxes, for example, and on incentives.
PROFESSOR WHITBY: Chris, you mentioned taxes and
incentives. I am minded to think that one could argue that
the vehicle exercise duty on vehicles with higher emissions
could be substantially greater than it is, and it might be a
policy that you or this group would recommend, but, at the
same time, I could equally see that our fragile industry might
be given a blow which might kill it. I am minded all the time
of how one can balance these requirements. I would like to
know your views about how that might be done?
MR HUHNE: Clearly, it is appropriate for any policy maker
to take on board all interests that are likely to be affected by
policy change. The particular example that you give, the
vehicle excise duty, we did as a Party, in fact, put on the audit
paper a proposal that the top rate of vehicle excise duty for
band G, that is for cars, vehicles emitting more than 225
grammes per kilometre of carbon emissions, should go up to
£2000 a year, which is actually the figure which comes
broadly out of the research which was done for the
Department for Transport and for the Energy Saving Trust.
What we were very disappointed by in the Chancellor's
proposals for the restructuring of VED was simply that he
had taken on board the Energy Savings Trust proposal to
have a new higher band, but he then proposed that it should
only go up by 45 pounds a year for these gas guzzling
vehicles, which, frankly, is about the cost of half a tank of
petrol; A Jeep Cherokee or a Porsche Kiam or whatever it
happens to be. Given that many of them are £40,000 or
£50,000 new, frankly it is going to have a completely
negligible effect. So we put down an amendment which
actually was the other part of the Energy Saving Trust and
Department of Transport advice with the figure of £2000, and
it is precisely that sort of measure, which is not necessarily
going to be universally popular amongst the Jeremy
Clarksons and following voters in some of the Home
47