G20 and COP 26 World Leaders Summit

“We all agreed to seek to restrain the rise in world temperatures to 1.5 degrees centigrade”.

On page 2 it has been downgraded from an agreement to a “shared aim”. By page 3 it is back to “a commitment” on a target, while by page 4 it is downgraded again to an “aspiration” or an “ambition”. Either the Prime Minister is confused or he has someone writing his Statement with a thesaurus to hand.

Together, the G20 nations represent 75% of global greenhouse gas emissions. As the noble Baroness understands, the world is reliant on their actions towards net zero. If they fail, it will be the small developing countries that pay the price. That is why we need a plan for implementation, whatever the word used for it. I did not hear a plan, strategy or road map today. Where is the plan?

Can the noble Baroness confirm whether the Prime Minister personally advocated for a 2050 net-zero date in the communiqué, or was he satisfied with the inclusion of “around mid-century”? Given the Government’s own record on new coal mines and oil exploration in the UK, did our domestic policy undermine our ability to negotiate a stronger line? The noble Baroness may recall that the FCDO previously announced a climate diplomacy fund to prepare for the summit. Can she update the House on how that money has been spent? I am happy for her to write to me if she is unable to answer today.

On international development, we are grateful to the G20 for reiterating that the consequences of climate change are already being felt by the world’s poorest and most vulnerable. But, as much as I welcome the acknowledgement in the Prime Minister’s Statement of the impact on important coral reefs, I would like to have heard more about the devastating and deadly human impact of our collective failure to act. But given the Government’s attitude to development aid and the cuts made, perhaps we should not be surprised. I wonder whether other countries raised this with Mr Johnson, especially those that have seen the pandemic as a reason to increase international aid.

On a similar note—again, I am happy for the noble Baroness to write to me if she cannot answer this—she will be aware that the Chancellor recently announced that the IMF’s special drawing rights will now be reclassified as international aid. This might sound like an accounting dodge, but it is important: it means that millions of pounds of support to developing countries will be lost. Given that the UK is the only major donor to do this, can she explain why the Government have taken this route?

On Covid vaccinations, for much of the developing world, the threat from the climate crisis is rivalled only by Covid-19. According to Amnesty International, while 63% of people in G20 countries are vaccinated, the figure in low- and lower-middle income countries is just 10%. We welcome the G20’s commitment, as previously agreed by the World Health Organization, to vaccinating 70% of the world’s population by the middle of next year. But, again, we come back to the plan: there is a lack of clarity about how this will be achieved.

I do not know whether the noble Baroness has had the opportunity to read the 10-point plan to produce and distribute vaccinations globally produced by the Labour Party. She might find it helpful. But can she outline for us the Government’s plan which backs up the commitments made?

On a note of optimism, the rubber-stamping of the global minimum corporation tax could pave the way for a fairer global tax system. But we come back to the issue of the plan: this is still a long way from implementation. Can the noble Baroness confirm whether the legislation has been drafted to give effect to this commitment? What steps are our representatives taking to develop the accompanying global framework at the OECD? The proposal represents an opportunity to build a new economy in the aftermath of the pandemic, but we also must take a lead in responding to the more immediate threats of rising inflation and the shortages we have seen. The noble Baroness may recall—although she may not be aware—that in the wake of the 2008 financial crash, the Labour Government, led by Gordon Brown, put forward a global plan to limit the damage and pave the way for recovery. That is the kind of leadership the UK needs and should provide again.

It is all very well, and is to be admired, for the Government to have aims, ambitions, and targets, and to work with others to secure commitments. But, coming back to my central point, unless there is a plan or detailed strategy to turn those commitments into reality, it is just warm words. If the Leader answers just one question today, can she tell us: where is the plan?

Today’s announcement on sustainable finance is potentially extremely significant, because if it becomes more difficult for firms in the coal- and carbon-intensive manufacturing sectors to finance new projects, many of these projects simply will not happen. More generally, the announcement by many global firms and financial institutions that they will align their investment and lending with the Paris climate goals could, if executed, do more than anything else to reorient the world economy towards a net-zero model. But the track record of companies which have made such commitments in the past is not encouraging. In a number of high-profile cases, banks which have promised, for example, to divest themselves of fossil fuel investments have broken the rules which they set for themselves; and they have not applied the rules at all to some asset classes. What legal requirements do the Government plan to place on companies and financial institutions listed in London, or based in the UK, to set net-zero plans? What sanctions will apply if they either fail to set them in the first place or, having set them, simply fail to implement them?

At the weekend the Prime Minister said that the score was 5-1 against the chances of Glasgow succeeding. Yesterday he claimed that the forces of climate action had pulled back a goal, or possibly two. The fact this Government have allowed the score to get to 5-1 against is a telling indictment of the casual way they have approached this summit. Failure over the next few days to change the scoreline further would be a disaster not just for the Government but for the planet.

The noble Lord asked about China. We welcome China’s commitment to net zero before 2060, and it signed the Glasgow Leaders’ Declaration on Forests and Land Use. It has committed to reach a peak in its emissions before 2030 and will then cut them to net zero by 2060, and of course it also pledged as part of the G20 commitment to stop funding coal projects overseas. Of course we will continue to engage with it and will continue to put pressure on it to move further and faster. I can assure the noble Lord that the Prime Minister spoke to President Xi before the summit and we will continue to work with international partners to move China in the direction that we would like to see it go.

On the noble Baroness’s comments about international development, as I said before and as she will know, we remain a world leader in international development. This year we provided over £10 billion towards poverty reduction, climate change and global security—a greater proportion of our national income than the majority of the G7. We are expected to be the third largest ODA donor in the G7 as a percentage of GNI this year and the third-highest bilateral humanitarian donor country.

The noble Baroness and the noble Lord asked about some of the various tax initiatives in both the G20 and COP 26 so far. We were pleased that the final political agreement has now been reached on the framework for the two-pillar solution on global taxation, as that was one of our priorities for the G7 presidency. The plan should be implemented to the 2023 timeline and we will continue to work with global partners now that we have reached this milestone to ensure that it is delivered.

On the IMF special drawing rights, the historic $650 billion SDR allocation has provided much-needed resources for vulnerable countries to pay for vaccine and food imports as well as increasing fiscal space for countries to pursue development priorities, including on climate and the environment. We have also been a leading voice on advocating for a new IMF resilience and sustainability trust, which will provide low-interest funding to vulnerable countries to address long-term structural challenges, and we are considering a sizeable contribution to that once it is established.

I hope the noble Lord will be pleased to know that progress so far has meant that $130 trillion of financial assets, equating to 40% of global finance, will now be aligned with the climate goals of the Paris Agreement thanks to the climate commitments made from 450 financial services firms. On the announcement that the Chancellor made today, the aim of the plans is for financial services to set out clearly their overall targets for decarbonisation, how they will align with the UK’s net-zero commitment, and what concrete actions they are taking to deliver this. To ensure that this is robust and to prevent greenwashing, we will set up a transition plan task force to set the gold standard for transition planning across the economy. Firms listed on the London Stock Exchange will have regulatory expectations that they set out transparently to consumers, investors and the public on what steps they are taking to align their business with net zero. Obviously it will then be for the market to determine whether those plans are credible. However, next year we will publish a net-zero transition pathway for this sector setting out how the financial sector will evolve out to 2050.

The noble Lord and noble Baroness rightly asked about Covid and highlighted the fact that the G20 leaders have indeed adopted a target of vaccinating 70% of the world’s population against Covid by the middle of the year. They also agreed to establish a G20 joint finance health task force to enhance dialogue and global co-operation on issues related to pandemic prevention and preparedness responses. We are being ambitious in what we are doing. We are donating at least 100 million Covid vaccines within the next year, 30 million of which we aim to deliver by the end of this year. That is in addition to the £548 million we have committed to COVAX to provide vaccines to help deliver more than 1 billion vaccines to up to 92 lower-income countries. As I said, before the end of the year we will have donated 30 million of the Oxford vaccines but next year we will donate at least 20 million more as well as all the 20 million Janssen doses we have ordered to COVAX. I can assure the noble Lord that that puts us well on track to meet our commitment of 100 million doses by mid-2022.

The noble Lord asked about supply chains. G20 leaders focused on the need for ongoing global co-ordination and action to address the huge price volatilities we have been seeing and they agreed to work together to better monitor and address supply chain vulnerabilities as economies recover and to support the sustainability of the global economy. In fact, the noble Lord will no doubt be interested to know that there was a dedicated session for like-minded partners that focused on how international co-operation to strengthen and diversify the supply chain ecosystem could happen, so a lot of work and discussion took place in that area.

On HGVs, we are increasing apprenticeship training funding by £7,000, investing £70 million in HGV skills bootcamps and we are increasing testing availability by 50,000 a year so that we can address this issue.