That the Grand Committee takes note of the case for the integration of policy-making in (1) national, and (2) local, government to achieve net zero carbon emissions in the United Kingdom.
My Lords, I declare my interests as a director of Aldustria Ltd, a trustee of the Green Purposes Company that holds the green share in the Green Investment Bank, and an honorary president of the Major Energy Users’ Council.
Beyond the pandemic, two emergencies confront us: climate change and biodiversity loss. Both are real and, like Covid, both can be fatal to our economy and society. Members and Ministers in this House are all good at fine words when it comes to these crises, and I am sure there will be many admirable ones in this debate, but what counts is action. This debate should focus on how we deliver our climate goals most effectively and certainly. To do that, almost before anything else, we have to closely co-ordinate work between government departments and between Whitehall and our devolved nations, combined authorities and local authorities. With climate change, there is no room for silos in decision-making or inaction—if there is, we lose.
I will concentrate on the word “action”. The Government have just accepted the Climate Change Committee’s recommended sixth carbon budget—I think that legislation is being laid before Parliament today. I welcome that, as I am sure we all do. I also welcomed the Prime Minister’s 10-point plan, but without a route map—I have not seen one yet—it is a 10-pointless plan. We are still waiting for a net zero road map, the Treasury’s review of the costs of decarbonisation and the strategy for heat in homes and buildings, and whatever happened to the task force net zero? Perhaps the Minister can tell us. Did the Cabinet committee on climate change that the Prime Minister announced at the beginning of his premiership ever get past its first meeting?
Despite our strong past performance on carbon reductions in the UK—we are all proud of that—we were on track to miss our fourth and fifth carbon budgets even when our 2050 target was still only an 80% emission reduction. We have become complacent. No wonder the reception of these new targets was muted. It is easy to set targets into the future—in this case 2035, 14 years away—making it happen now is the test of our sincerity.
To quote Alok Sharma, COP 26 president and Cabinet member, on the announcement of the sixth carbon budget decision:
“Long term targets must be backed up with credible delivery plans”—
how much I agree with Mr Sharma. Chris Stark, chief executive of the Climate Change Committee, stated:
“This target means every choice we make from now must be the right one for our climate.”
That means the choices made by the Treasury, the Cabinet Office, the Department of Health and Social Care, the Foreign Office and all the rest, not just BEIS and Defra.
How successful are we at Whitehall co-ordination? Back in ancient history, under Gordon Brown as Chancellor, the Treasury produced the Stern report and acted on it. The result was the Climate Change Act. But this year’s Budget was judged “climate-lite”. There were some good announcements, including green bonds—though late and long resisted by the Treasury—and the UK Infrastructure Bank, but no mechanism to ensure net zero- compliant investments and no big push of retrofit; in fact, there was a retreat on this. The Government backed away from green taxation, despite having previously trailed it in the press.
My Lords, I start with some congratulations. I first congratulate the noble Lord, Lord Teverson, on picking out this debate and on his masterly coverage of the issues in his opening statement. This is a vital point; we need to make sure that government not only is not prone to complacency—as has been the case hitherto—but is getting itself into a position where it is capable of delivering what it promises and its stated intentions. I also briefly congratulate the Government, who yesterday produced on paper a pretty coherent response to the Climate Change Committee’s latest carbon budget, increasing the ambition of the timescale for delivery of our pathway to net zero.
That was positive. It was also positive that, for the first time, they included figures for the UK’s contribution to the cost of shipping and aviation, which the British economy imposes on international transportation. As the noble Lord, Lord Teverson, asked, however, where are the means of delivery? We have already failed—or are likely to fail—to meet the previous CCC carbon budget, and there is no reason to think that the Government are in better shape to deliver on the subsequent stages. The work of the Climate Change Committee has been vital. It has spelled out across the board what we need to do nationally, locally and internationally. Everybody—apart from a few climate change deniers, whom we still have in this House—has agreed that this is a good and clear road map. In theory, so it is, but it is the practice to which the noble Lord, Lord Teverson, has drawn to our attention.
I draw the same conclusion as the noble Lord, Lord Teverson. We need in charge of this process a senior Minister at least equivalent in status to the Chancellor of the Exchequer. The appointment of Alok Sharma, capable man though he is, is not what I mean. I mean someone who has command over other departments, whose name resounds around Whitehall, and who can give a lead to other parts of the public and private sector.
I apologise for the interruption; I have slightly lost my place. My original intention in looking at this was to go through all 10 points of the Prime Minister’s commitment to creating a green industrial society and strategy. That was probably too much and, in any case, the noble Lord, Lord Teverson, has already covered a few of them.
However, under each point, it is clear that is not just central government and a particular department that is responsible for delivery, but a whole range of departments; that was pretty clear from what the noble Lord, Lord Teverson, said about transport, buildings and so forth. Even the things that appear to be the purview of one department are affected by the position of other departments. Take the first: quadrupling offshore wind power. This involves BEIS, obviously, as the sponsoring department in energy policy, but we are proposing quadrupling wind power, which means that we will have to bring more of that power ashore. It means that the current situation, where individual turbines in arrays have their own point of contact to the shoreline, will increase a hundredfold if we allow every single instance of a turbine in an array to have its own point of contact. That is ridiculous.
We need to ensure that there is a network at sea before we bring it on land so that we reduce those hundreds of points to a few score. That requires planning permission from the local authority; environmental controls from the Environment Agency; and Defra and the marine authorities to look at the effects on marine life and fisheries. And all that needs to be brought together to deliver what seems to be a simple quadrupling of what has been a very successful commitment to offshore wind.
The same will apply in other areas, even in nuclear power, which seems very much a central, single government interest. That will also require huge commitments on the environmental, planning and construction side. It will require an integration of the delivery of new nuclear power with other aspects of the delivery of greener energy and heating, such as the creation of hydrogen and, indeed, carbon capture and storage.
My Lords, I welcome the Prime Minister’s radical new climate change commitments announced yesterday, which will set the UK on course to cut carbon emissions by 78% by 2035. For the first time, climate law will be extended to cover international aviation and shipping. That commitment, which is to become law, brings forward the current target for reducing carbon emissions by 15 years and confirms the UK’s world-leading position. That is also the easy bit. The challenge now is to have policies to realise the targets, and that will not be possible without a more joined-up approach both at the departmental level and between government and local authorities. That is the subject of this timely debate, and I am most grateful to the noble Lord, Lord Teverson, for choosing the date so successfully.
There is no shortage of advice for the Prime Minister and the Government. In its report to Parliament in June 2020, the Committee on Climate Change—the CCC—argued that the scale of the net-zero goal required it to be
“embedded and integrated across all departments, at all levels of Government and in all major decisions that impact on emissions.”
It has also recommended steps to improve integration in net zero policy-making. Similarly, the National Audit Office stated that
“all government bodies, including departments, arm’s-length bodies and executive agencies have a role to play.”
It also recommended a cross-government plan, as well as regular reviews of the effectiveness of current oversight arrangements. In August 2020, the Prime Minister’s Council for Science and Technology published advice to the Government on using a whole-systems approach to the transition to net zero.
The Government agreed that net zero should be a core government goal integrated into all policy-making where appropriate. The overall responsibility for the net-zero target rests with the Department for Business, Energy and Industrial Strategy, but every other department is involved. The USA is doing well on a joined-up approach, particularly since President Biden took office, and all departments and federal agencies there have been directed to focus their efforts on tackling climate issues. Can we learn anything from them? In the UK, there is currently a Cabinet-level committee on climate change, but I understand that it has not met very often. Can my noble friend tell me how often it has met in the last year? Is part of the problem that everyone on it has other compelling priorities?
My Lords, I declare my interest as a co-chair of Peers for the Planet and echo the words of previous speakers in congratulating the noble Lord, Lord Teverson, on his compelling introductory speech, on the work that he did for many years on the EU Environment Sub-Committee and on his impeccable timing in allowing us to debate this subject in the week of the Government’s commitment to the Climate Change Committee’s sixth carbon budget targets.
I suspect that the themes running through this debate will be echoed by many speakers. I, too, want to focus on the transition from rhetoric to reality. There is that beautiful phrase from Mario Cuomo:
“You campaign in poetry. You govern in prose.”
The Government so far have been very good about the poetry of commitment on climate, but the prose of delivery has not been so good. As others will, I want to focus today on how we achieve the emissions reductions needed to achieve the targets that we have adopted, and on how delivery is the challenge now.
While the scale of action needed at every level—national, regional, local government, industry, science and technology and individual behaviour change—is huge, it is important to remember that there are tremendous benefits as well as costs in taking the opportunities offered by setting sustainability as our guiding principle. As the Foreign Affairs Committee said this week in its report A Climate for Ambition: Diplomatic Preparations for COP 26:
“The recovery from covid-19 will require a Marshall Plan-scale commitment from many and the UK should ensure that this aligns with environmental ambitions, embedding a green outlook into a new economy. The FCDO should communicate to its partners that environmental agendas are not in competition but integral to health, development, and security policies.”
My Lords, it is a pleasure to follow the noble Baroness, Lady Hayman. I agree with her every word. In doing so, I pay tribute to her foresight and determination in creating a forum for Peers who are interested in tackling the climate emergency but rather bemused by its urgent complexity by setting up Peers for the Planet.
The complexity of the climate emergency is that the science and evidence before us are telling us with increasing urgency that climate change cannot be tackled issue by issue in silos. It is evident that our natural planetary systems inextricably link humans, animals, microorganisms—including viruses, the skies, the oceans and all land and its features, such as glaciers, forests, mangroves, coral reefs, peatbogs, mountains, lakes, farms and cities. That complexity is encompassed in many ways by this timely debate, tabled by my noble friend Lord Teverson, because it asks us to focus on the need for an integrated government approach if we are to successfully meet the interlinked challenges needed to get to net zero.
This is an important issue, and I thank my noble friend for bringing it to your Lordships’ House via Grand Committee. Declaring a climate emergency, setting a net zero target and even agreeing to the agenda for the sixth carbon budget, as set out by the Climate Change Committee, are, quite frankly, meaningless unless accompanied by meaty government processes that cover all arms of government, including its agencies, and all levels of government, especially those such as local authorities, which are rooted in their place and in touch and in tune with their communities.
The fact that my noble friend intimates in the title of his debate that the case for joined-up government needs to be made tells us that the Government’s words are just that: words. To date there has been little commensurate action to underpin their stated ambitions and intentions. I totally agree with the urgent need for a Cabinet Minister responsible for tackling the climate and biodiversity emergency, which many previous speakers have called for.
3:27 pm
20 of 62 shown
Let us be clear: if we are to win the climate change challenge, two departments have to be at the centre of it, and they are not BEIS and Defra but the Treasury and the Cabinet Office. There has to be a senior Minister in the Treasury whose sole focus is the climate change agenda. In the Cabinet Office there should be created a Minister for the climate emergency, who is a full member of Cabinet. That is the practical demand of the Government’s rhetoric and our desire to succeed.
There is one other department that I want to put in the spotlight when it comes to silos, yet it also is at the heart of climate change policy. That is the Ministry of Housing, Communities and Local Government. It scrapped the 2016 zero-carbon homes deadline and did the same for the 2019 commercial buildings target. It rules the roost on building regulations, but I get no impression from it of a desperation to urgently uprate standards, let alone inspection rates. The Conservative manifesto pledged over £9 billion for retrofitting buildings, which I welcomed, but, a quarter of the way into this term of office, very little has been committed. I shall come on to the green homes grant later.
Then we had the Cumbria coal mine. It somehow did not seem to occur to the department or the Secretary of State that a brand spanking new coal mine being approved in the year of our COP 26 presidency, when the UK was internationally the co-founder of the Powering Past Coal Alliance, might just be seen as a little off-message by the rest of the world. It is amazing—and amazing too, apparently, to COP president Alok Sharma.
Whitehall silos are a challenge to all Governments—I understand that—but when it comes to climate change, we just cannot afford that luxury, or that inefficiency. As part of removing the climate silo, investment appraisal in all departments must be subject to a “route to net zero” test. That financial rigour is really important in all departmental investment.
I turn to local authorities. The great news is that more than 300 local authorities have declared a climate change emergency. That is brilliant. They are of all political persuasions, and for most it is not just a declaration but a genuine call to action. Two-thirds intend to be carbon neutral by 2030. One reason that this is good news is that some 50% of the carbon reductions we will need in the future are strongly influenced by local policy-making. But when it comes to achieving net zero as a nation, central and local government are like two ships passing in the night.
The next stage of decarbonisation will be far more difficult than what we have experienced so far. Unlike when coal was removed from power generation, our fellow citizens will notice the differences in the way they live. Local authorities are trusted by 80% of their citizens—a far higher percentage than trust, say, the electricity suppliers or even central government—so local authorities are essential to the delivery of the net zero route map. This is the case especially in such areas as the energy efficiency of homes and buildings, transport, waste, planning and the often neglected area of enforcement.
What better example is there of local doing it better than retrofit and home insulation? The fiasco of the green homes grant illustrates all too well that in this area top-down does not work. Local or combined authorities should spearhead retrofit, preferably on a street-by-street basis. To me, that is utterly obvious. Frankly, they should also be delivering the ECO—energy company obligation—programme rather than the energy supply companies. But of course, dumb Treasury definitions of public expenditure get in the way of serious delivery.
Transport is the one growing area of emissions in the UK and, with the rise of white vans and SUVs, it is not just air travel and shipping. Again, local authorities are clearly the best at delivering co-ordinated low-carbon transport plans. Only they can ensure that all citizens have access to charging points for EVs at or by their homes, not least when they do not have a parking space except on the road. Only in that way can we ensure a just transition, which we all want. Moving from landfill and energy from waste to recycling and reuse is a core local activity as well. The enforcement of planning conditions, building regulations and trading standards on energy efficiency is local but hugely underfunded, making prosecution unlikely. That under- funding of enforcement really must change.
Among all their other strategies and route maps, the Government must publish a specific plan or concordat for how they will engage fully with local authorities in the delivery of climate change goals. As part of that, there must also be a grown-up fiscal settlement between the two—difficult, I know, but it has to be done.
As part of my preparations for this debate, I decided to speak to a number of local government officers on the ground in the climate change area to understand their experience of working with Whitehall. I will give five short quotes, which all relate specifically to climate change. Here we go—in their words rather than mine. First, when it comes to climate change, government is divided on the issues at departmental level, and there is no core ethos that drives conversations down a clear pathway. Secondly, we still get pushed towards a more traditional economic justification for projects and initiatives by many departments, and the climate change agenda is too big for that. Thirdly, we have to deal with a multitude of funding streams that are complex, short-term and never allow for strategic-level planning and, equally importantly, do not allow for supply chain development, market confidence and skills development —a reflection of those short-term government policies that change so quickly, so that once you have built up the skills and the organisation, the programme ends and everything stops. Fourthly, there needs to be much greater co-ordination between the climate and ecological emergency agendas within government, as talking to Defra and BEIS is like speaking to completely different organisations. Lastly, we need some form of concordat where there is an honest discussion of what local areas can and cannot do, charting a strategic pathway linked to long-term funding. Those are their words and their experiences, not mine.
Whether it is co-ordination and unity of purpose between Whitehall departments, or central and local government, this has to work. I have made many recommendations, but I ask the Minister specifically: will he ensure that a route map is published, in full consultation with local authorities, that paves the way for close and mandatory co-operation and co-ordination between central and local government? If so, we can achieve so much more, better and at greater speed. I beg to move.
We also need to engage all departments in a high-level Cabinet committee, probably led by that same Minister, if not the Prime Minister himself. In different circumstances, I might have suggested the Prime Minister, but I am not entirely sure that, in the present circumstances, that would be wise. We need somebody specifically focused on this task. Again, as the noble Lord, Lord Teverson, says, the departments largely in charge of delivery at the moment are not particularly highly rated within Whitehall or, indeed, in the country as a whole. Moreover, their climate change commitments are only part of their responsibilities, so BEIS’s responsibility for climate change is often swamped by its industrial and energy responsibilities. Even Defra, which is still in charge of mitigation and various other aspects of climate change, is swamped by rural and agricultural requirements. They are not departments that can deliver. We need a new department for climate change.
I have decided not to go through all 10 points so I will not do so. However, in addition to the changes in central government that the noble Lord referred to, as have I, we will need local government to become more coherent, we need relations between the central Administration and the devolved Administrations to work more effectively on this, and we will need to ensure that there is clarity in reporting to Parliament.
That is my last point. I was a member of the Joint Committee of the House of Commons which preceded the Climate Change Act 2008. I now seem to have gone full circle: as of last week, I have become a member of the Lords new Committee on Environment and Climate Change, and I am very grateful to your Lordships for putting me there. However, some things have not improved, and cohesion in government is one of them. If that is not achieved by government itself, perhaps parliamentary pressure through our committees and the Commons committees will ensure that the fine words and the very clear policy direction is delivered by an interlocking and clear commitment from government. The clear strategy, some of which was announced yesterday, the fine words, the individual commitments, and the fact that we have most of business and much of the public on side, will not deliver of itself. It would be a serious problem if we were to screw all this up due to institutional inflexibility and a lack of interlocking government.
I support this Motion and I hope the Government take serious notice of what has been said.
Beyond that committee there are few formalised mechanisms within the machinery of national and local government to ensure joined-up, consistent and prioritised consideration of the delivery of net zero. As this is such an important matter, does my noble friend the Minister agree with the noble Lords, Lord Teverson and Lord Whitty, and me that a Minister who sits in Cabinet should be tasked with overseeing different departments’ work on both climate change and biodiversity loss, with the ability to act as a central point in government for the net zero programme? This would allow different departments to continue the work they are doing: BEIS on the decarbonisation of energy in the economy, Defra on land use and ELMS, the Department for Transport on electric vehicles, et cetera. Perhaps there could be a team—in the Cabinet Office, say—whose sole focus is ensuring that work is integrated, complementary and, crucially, deliverable at local level.
I understand there are great challenges at the local authority level. Some 96% of local authorities surveyed said that funding was a barrier to them tackling climate change; 93% cited legislation or regulation, 88% a lack of workforce capacity and 78% a lack of skills. The Government and local authorities have a huge amount still to do. But the Government are doing things, which is good news. The Environment Bill, which we will discuss when Parliament reassembles, includes a requirement that the Government should prepare a policy statement to set environmental principles. One principle is how environmental protection should be integrated into the making of policies. The Bill would require Ministers to have due regard to the policy statement when making policy. I have no doubt that all noble Lords speaking in today’s debate will take part in the Environment Bill and I expect it to emerge a stronger and better Bill when it leaves our House.
HM Treasury has revised the Green Book to place a greater emphasis on environmental considerations. The Treasury is also carrying out a further review of the current approach to valuing future benefits adequately and accounting for environmental effects. The Dasgupta review is a promising start but it is not the end of the road; it is merely the beginning.
What has not been mentioned so far is that it is not just local government in England that matters. The CCC said that Scotland, Wales and Northern Ireland account for around one-fifth of the UK’s emissions for environmental effects. Therefore, they will have to play an integral role in reaching the net zero target and there will have to be great co-operation between Westminster and the devolved assemblies.
At the end of the day, all of us will be involved in climate change. All our lifestyles are going to change. We are going to need to be involved as individuals. But in order to feel that involvement and to take part in the changes that are ahead, we need to be able to understand and be sympathetic to the policies that the Government announce. Therefore, I implore my noble friend the Minister to use the KISS principle—keep it simple, stupid. If he tries to make it complicated, we, the public, will not understand. I give as an example recycling, which is a fearful mess. It is getting better slowly but it is an area where there has been misunderstanding and, as a result, great damage to the environment. We need to be part of what the Government are going to do. We need to learn, we need to be educated, and that will be a huge task for the Government.
I want to argue that central to achieving our targets, as well as a whole range of specific initiatives and investments in the areas that we know are critical, will be a whole-systems approach to integrated climate considerations into policy-making in every aspect of national life. While success will not come from government action alone, government has a central role in leading, facilitating, stimulating and providing the regulatory and taxation frameworks for success, as well as investing and working, as others have said, constructively with local government and devolved Administrations.
I shall not focus today on policy areas where net zero needs to be embedded or the various sector strategies needed, particularly in relation to energy, buildings, planning, housing, transport, industry, skills and education. I am sure that other noble Lords will focus on those topics, along with the investment challenge, to ensure that there is the right balance between direct government funding and private investment and that the transition is just. Instead, I want to address the governance of policy.
The Council for Science and Technology, in its 2020 report Achieving Net Zero Carbon Emissions through a Whole Systems Approach, emphasised:
“Achieving net zero by 2050 is a system transformation challenge … Policy areas that have previously been managed separately or in isolation will need to be brought together. They should be developed as an interconnected programme of work, driven by data and analytics, with responsibilities, funding and accountability aligned behind a single goal”.
To put it simply: no more silos.
We need to adopt the standpoint articulated by the US Secretary of State, Antony Blinken, who said this week that the US State Department would “weave” the climate crisis into the fabric of everything that it did. As the noble Lord, Lord Teverson, and other speakers illustrated, we are not doing that weaving very well at the moment; we need radically to improve the machinery of government and the coherence of policy-making if we are to achieve an integrated approach.
Others have mentioned the Cabinet committee on climate change. We are told that it was established in October 2019, but there has been little indication of progress or activity, and there are few formalised mechanisms within the government machine to ensure joined-up, consistent and prioritised consideration for delivery of net zero targets. The Government’s 10-point plan promised a net zero task force, but when will it be set up, who will comprise the membership, how will it report to Parliament and the public, and will departments such as housing and transport, responsible for high volumes of emissions, be included in a way they are not on the current Cabinet sub-committee for strategy? The absence of such cross-cutting mechanisms and of a determinedly coherent approach at the highest level of government cascades down into inconsistent policy- and decision-making that is either contrary to or fails to take advantage of opportunities to achieve progress towards our net zero targets, so legislation is still introduced with no mention or understanding of the relevance of our domestic and international responsibility on climate, as seen recently in Bills on pensions and finance, when action had to be taken in your Lordships’ House to include provisions on climate.
Then there are decisions such as that on the Cumbria coal mine, road building programmes, airport expansion, air passenger duty, the freezing of fuel duty and bailouts without strings for high-carbon sectors, which run contrary to our commitment to net zero and undermine our position as a global climate leader. As others have said, cancellation of zero-carbon homes standards and the green homes grant has slowed down the decarbonisation of housing and has pushed the costs of retrofit on to home owners.
How can we achieve this systemic integrated approach? First and foremost, I would suggest a mindset and leadership at the highest level of government, and this is where the argument for there being a Cabinet Minister in charge comes. That would ensure that a climate lens is applied to all policies and legislation and that the elusive ideal of joined-up government is actually put into practice.
We need to look at some other specific approaches, some of which have already been adopted in other countries. One of the most important would be for all proposed legislation and policy initiatives coming to Cabinet to have a climate impact assessment to show whether or not they align with net zero. This is already being done in New Zealand and Sweden. We could place a statutory duty on departments and Ministers to further climate change goals. The new US climate Bill directs federal agencies to
“use all existing authorities to put the US on a path towards meeting this net-zero emissions target.”
Just as the Bank of England has been given a remit to take climate risk considerations into account, so could other regulators and public bodies. National planning policy statements should all be aligned with net zero, not be incoherent, as they are at the moment.
Given the critical role of local government, which others have stressed, we could follow the example of Ireland, which has set up a network of four local authority climate action regional offices to support co-ordination and learning and address mitigation and adaptation.
There is an argument for the Government to consider setting up a delivery body, along the lines of the Olympic Delivery Authority, to drive forward the huge systemic change needed. Given that transition will entail change for individual citizens, are the Government going to build on the very successful climate citizens’ assembly held by Parliament last year?
Before I conclude, I will deal with one question that is often raised: is there any value in the UK taking effective action to reduce domestic emissions, given that we are, as some would say, small fry compared with other nations in the league table of emitters? In the year when we are hosting both the G7 and COP 26, we have both enormous opportunities and enormous responsibilities to influence other countries, including those with greater emissions than our own, to take radical action to halt climate change and reverse bio- diversity loss. We will not have the credibility to lead in those fora unless we have ourselves walked the walk, not just talked the talk.
There is much talk of global Britain post Brexit. To achieve that ambition, what we do at home will directly influence levels of climate ambition across the world. In the words of the Foreign Affairs Committee report I quoted earlier:
“The UK has the chance to lead and set ambitious domestic climate policies, alongside credible plans to deliver them … It is essential that domestic policy decisions support rather than undermine diplomatic efforts. We recommend that the UK leads by example and sets ambitious domestic climate policies.”
We need to achieve those ambitious domestic policies. If we do so, and achieve the integrated and whole-system approach necessary to do so, we will not only have strengthened our economy, created sustainable jobs for the future, improved our nation’s health, and protected the future and our grandchildren, but genuinely led the world.
I will divide the rest of my contribution into two parts, the first focusing on local government and the second on one of the more egregious examples of unjoined-up, incoherent national policy-making by the Government. I very proudly served as a councillor for Kew ward in the London Borough of Richmond upon Thames. My roles for four consecutive years included that of assistant cabinet member for environment and climate change, and sitting on the planning committee, which was an interesting and fascinating experience. It will be crystal clear to anyone who has been a councillor that local government is key to success in reaching net zero targets.
I will pick out just a few of the myriad ways in which local government is essential to realising the CCC’s agenda for achieving net zero by 2050. Behavioural change is identified as a crucial component of success. A top-down approach will not on its own effect that; psychologists will tell you that peer pressure from friends, family and neighbours will have the biggest impact. We need to work from the ground up, and local authorities are well placed to do just that. They have the power to influence how residents use their local spaces; they can tweak local road schemes, encourage more walking and cycling and better eating habits and, crucially, put in place measures to increase energy efficiency in their local housing stock.
According to the CCC, local authorities have powers or influence over a third of emissions in local areas, much of which come from housing. To meet net zero, virtually all heat in buildings will need to be decarbonised and heat in industry reduced to almost zero carbon emissions. Given the importance of achieving success in this area, it is extremely frustrating that the green homes grant has been such an abysmal failure—cut in just six short months. Can the Minister say why the scheme, for which there was great demand, was cancelled? Can he also say why no notice was given and what will replace it?
I turn to local authority funding. The UK, despite its size, is one of the most centralised countries in the world; only about 5% to 6% of all tax revenue is raised by local government. However, it has not always been this way. In the 19th century, local government in Britain was as decentralised as Germany is today. It was only in the post-First World War era that Whitehall gradually accrued the spending power that previously lay with town halls. Given the growing inequality among the regions of the UK, I do not think that change has been an unqualified success.
To play their essential role in meeting the net-zero target, local authorities must be adequately funded. When grant schemes such as the green homes grant are suddenly cut off, that really hurts not just local authorities but local businesses and jobs. With £2.1 billion of EU structural funds cut off after Brexit, it behoves the Government to seamlessly put in place their successor scheme. We are heading towards the end of April 2021, and still there is no sign of the promised consultation on the shared prosperity fund. When can we expect it? Also, when will the Government issue the sovereign green bond, announced by the Chancellor in the House of Commons last November? Can the Minister confirm that, when set up, it will be able to make loans to local authorities?
I have just one other question for the Minister on funding for local authorities. Do the Government have a view on the new report from the London School of Economics and Leeds University, produced in association with the All-Party Group on Sustainable Finance, UK100 and HSBC? The report assesses how UK policymakers can engage the financial sector to meet the net-zero target and its commitment to the levelling up of regional economies in the context of Covid-19 and Brexit. Its authors and supporters would like to see Ministers make a strategic commitment to a just transition for jobs, including plans for mobilising public and private sector finance to deliver place-based projects which tackle both environment and social challenges. Will the Government respond to the report and put their response in the public domain?
I want to dwell on jobs for a moment. Maybe the Minister will correct me if I am wrong, but I think the green homes grant scheme, in large part, fell because of a lack of skilled people to carry out the installations and the complete lack of an efficient process to administer the scheme. Local authorities know their workforce. They know where they are; they know what they do. They will be invaluable in helping to get people reskilled and ready for new jobs in the greening of various sectors of our economy. The only way that communities will be ready to take advantage of the new jobs that green investment will bring is if there is strategic planning for the right sort of skills training and knowledge base that will be needed in the local neighbourhood. Central government does not have that knowledge—which, by the way, is not the same as data. If we are to reach our net-zero targets, local authorities will be key to successful transitions to new industries and new ways of doing things. We must value them, and we must fund them.
In conclusion, I will say a few words on the incongruity of the Oil and Gas Authority’s policy of maximising economic revenue and the legally binding target of net zero by 2050 both sitting within the same legislature. To limit global warming to 1.5 degrees centigrade, oil and gas production around the world needs to decline by an average of 6% per year between now and 2030, according to the UN Environment Programme 2020 Production Gap report. Instead, current global plans to increase production would lead to 120% more fossil fuels extracted by 2030 than would align with the Paris Agreement. Here in the UK, under the recently announced North Sea transition deal, the Government plan to continue to issue new licences to explore for and extract oil and gas. How is the MER—maximising economic revenue—policy compatible with our leadership of the climate emergency agenda and our standing on the global stage for COP 26 in November this year?
It is clear from our continuing MER policy and, indeed, the fiasco around the controversial Cumbrian coal mine that our legislation is not fit for the purpose of meeting the net-zero targets, and legislative alignment is sorely needed on our national planning regime. My final question to the Minister is: will we get our domestic legislation in order before COP 26? It would at least give departments a fighting chance of pulling in the right direction at all levels of government.