Clean Air (Human Rights) Bill [HL]

Lord Desai Excerpts

2nd reading
Friday 8th July 2022 Lords Chamber

[Lord Desai (Non-Afl)]

My Lords, I join everyone else who has spoken in welcoming the Bill and congratulating the noble Baroness, Lady Jones, on introducing it. Since everything that is worth saying has been said, I shall point out only one or two things that I believe we could improve in Committee.

First, as the noble Lord, Lord Thomas, pointed out, declaring something to be a human right may not be sufficient in the current climate, because the Government frequently redefine what is and is not a human right or is justiciable by the European Court of Human Rights. So, at some stage, I would like to find out how we can strengthen the idea that this is a human right and cannot just be thrown away, neglected or revised by a future Government. That is very important.

Secondly, as an economist, I studied the Clean Air Act 1956 very carefully and wrote about it. One thing that is missing is the polluter paying; at least in cases where we can identify the polluter and attribute responsibility for the pollution to them, we ought to allow them to be fined, not just forgiven.

Lastly, there is a role for citizens to do something about pollution; this is very welcome. The Government are allowed too much power to appoint citizens’ commissioners; we ought to find ways of inviting voluntary workers in this important area, because pollution is a problem for all of us, and we all ought to be encouraged to be policemen for it and point out that these things are hurting us all. By the time a little girl dies due to air pollution, it is too late to seek compensation. We ought to be able to spot these things much earlier and do something about them.

Queen's Speech

Lord Desai Excerpts

Wednesday 2nd June 2010 Lords Chamber

[Lord Desai]

My Lords, I shall miss my noble friend Lord Myners and the noble Baroness, Lady Noakes, but I welcome the new team, whom I have known for a long time and shall have fun attacking.

Unlike many of my noble friends, I have always taken the view that the deficit has to be tackled and, along with 19 other economists, signed a letter to the Sunday Times to that effect. The noble Lord, Lord Skidelsky, then found an army of many more economists to demolish my case, but we shall see. The important point is that we should debate the timing of deficit reduction, not the need for it. Even on timing, the choice is not as wide as people think. We are in the midst of a recovery. Growth in the last quarter of last year and the first quarter of this year was fragile, but the figures have been revised upwards. We will most likely have a growth rate of around 1.5 per cent to 2 per cent this year. When the right honourable gentleman the Chancellor of the Exchequer announces his emergency Budget, it is important that he ensures that the path of deficit reduction is properly laid down without any confusion and that he makes it contingent on a certain growth trajectory. When the Office for Budget Responsibility checks the growth figures, I hope that it will follow the practice of the Bank of England and produce a range of likely growth figures, because we need to think about the uncertainty surrounding those figures and then look at the timescale of deficit reduction.

I produced a paper before the election with Peter Kenway of the New Policy Institute in which we calculated the rate at which the deficit would have to be reduced to bring down the share of spending from its present high figure of 44 per cent of GDP to, say, 40 per cent, which is what it was in 2002. The most important element in that calculation is that just keeping real current spending constant—zero growth—and relying on growth to bring in revenue may be a good and cautious strategy to begin with. If even that much is done, it will be good. What people historically call cuts in government spending in the UK are not actual cuts but occur when the growth of current spending is less than the growth of GDP. The growth of GDP will have to be watched carefully; at the minimum, to have constant real spending would be a good strategy.

The Liberal Democrat proposals for fair taxation are extremely muddled. The Liberal Democrats are good-hearted people but they have not really thought this through. In order to take about 2 million people earning between £6,500 and £10,000 out of taxation, they are giving another 20 million people more money than they are giving to the people whom they really want to help. People earning above £10,000 will get £700 guaranteed, while people at the lower end of the scale will get somewhere near £700 at most. If you help only the 2 million lower paid, that will cost £1.5 billion, but taking this course would add another £15 billion of cost for those who do not deserve the extra money. That is not fair; it is regressive and expensive. There is a simple way of achieving something better, which is not to raise the personal allowance but to give people who earn between £6,500 and £10,000 a tax rebate. In that way, only those people would get a tax rebate, not the rest. I suggest an even better measure—I have written about this and I hope that it will appear in print very soon—which would be to abolish the personal allowance altogether and convert it into a tax credit. Everybody would get a tax credit equivalent to the basic rate of taxation times the personal allowance, which is £1,300 in today’s figures. The advantage of that is that people who earn less than £6,500 who do not now pay tax would pay negative income tax and get a credit. In that way, you would help the really poor people through the taxation mechanism to a far greater extent than we are doing now.

It is a good idea to integrate income and capital gains in a single taxation framework. However, you should do that consistently. I suggest that the 20 per cent and 40 per cent rates be incorporated in the capital gains part of tax as well.

The noble Lord, Lord Higgins, decried the fact that the IMF has suggested that the zero rating of VAT be abolished. I proudly say that the IMF has at last seen the sense of what I was saying 17 years ago, for which I was sacked from the Labour Front Bench. That is not a bad lag for the IMF. I wish that the Government would catch up with the IMF and abolish zero VAT rating. If you are to cut the budget deficit and the debt, you have to choose carefully whether it is not better to increase taxation in certain respects rather than to cut spending. It is a fine balance but I have never understood the holy-cow nature of zero rating of VAT on children’s food, which contains far too much sugar and salt. Tax it and we will get a healthy population.

--- Later in debate ---

[Lord Henley]

The forecasts of the OBR, as I made clear, will be independent. It is for it to make those independent forecasts. I was trying to stress its independence. I shall write to the noble Lord on that in greater detail, but its independence was his principal concern. He will have a chance to see the first of those forecasts quite soon, as I understand that the first of them will be out before the Budget. If I am wrong about that, I shall let him know in due course.

One should also refer to the OECD’s recent economic report, which argues that a more rapid fiscal consolidation would help the recovery by leaving room for interest rates to remain lower for longer. That will support spending by households and by business. The importance of taking action this year is underlined by recent events in the eurozone. Failure to take action would put that recovery at risk.

I turn to questions asked about tax. Noble Lords mentioned CGT, income tax and tax avoidance—that was the noble Lord, Lord Oakeshott. We heard confessions from the noble Lord, Lord Desai, about his having to resign from the pre-1997 opposition Front Bench for his views about that. As I remember it—the noble Lord will no doubt correct me—he had to resign from the opposition Front Bench more than once.

[Lord Desai]

I was sacked.

[Lord Henley]

I remind the House for its amusement that the second occasion on which the noble Lord was sacked, or it might have been the first, was the result of his having informed the House, or perhaps the world more generally, that his then leader—we shall not mention which leader it was—was no economist. That struck me as a statement of the obvious, but he was sacked nevertheless.

Many noble Lords have raised CGT, VAT, income tax and tax generally. The noble Lord, Lord Myners, pressed me to give an explanation of what was going on. I have to remind him, first, that I am not a Treasury Minister and, secondly, that I think he knows the date of the Budget. Neither the noble Lord nor any other noble Lord expects me to second-guess my right honourable friend. It is very tempting to do so, but it is one of those occasions where one has to say that it is beyond my pay grade. The noble Lord will have to wait three weeks until the Budget to hear answers on those matters.

I appreciate that time is moving on, so I shall say a little about policy on climate change, which was another subject that attracted a great many speakers. I was grateful for the support that came from many noble Lords, but I noticed the concern expressed by two sceptics—I think that that is the right word—on my own Benches, my noble friends Lord Lawson and Lord Reay. As the noble Lords, Lord Whitty and Lord Hunt of Chesterton, and my noble friend Lord Jenkin put it, there is a need to convince the public on this issue. It might be more than just the public that we have to convince; it might be some of my noble friends. Certainly, there are matters that we need to look at here, and a great number of matters on which I shall have to write to noble Lords in due course to deal with their concerns. For example, the noble Lord, Lord Whitty, raised the question of the Government’s commitment to the renewable heat initiative. That is something that we are committed to supporting, but we still need to consider the various options for promoting it most efficiently.

We will look at all the other renewables that noble Lords mentioned—and my noble friend Lord James referred to the possibility of tidal power on Dogger Bank. As my noble friend himself admitted, some pretty great technological challenges face us in an area such as that. I also give an assurance to my noble friend Lord Teverson that we will certainly push the EU to demonstrate leadership by tackling the levels of international climate change and supporting the increase in the EU emission reduction target to 30 per cent by 2020.

There were some fairly technical questions from my noble friend Lord Jenkin and the noble Lord, Lord Giddens, on the carbon floor price—questions that are slightly beyond my level at the moment. That is something for other departments, but I can give an assurance that we will introduce a carbon floor price because we recognise that the long-term certainty of the carbon price is one factor that affects investment decisions in low-carbon electricity generation. The exact timing of its introduction needs to be considered further but will need to fit the objective of increasing incentives for low-carbon generation. I note the concerns expressed by my noble friend Lord Jenkin on the speed of planning decisions.

I turn to the question of whether nuclear power needs subsidy, a point raised by the noble Lord, Lord Giddens. We believe that it does not need public subsidy and, on that basis, energy companies have already come forward with plans to build and stand up to 16 gigawatts of new nuclear energy. Certainly, we are keen on new nuclear energy, and I can give that assurance to the noble Lord, Lord O’Neill of Clackmannan. On his more detailed question about the funding for Sheffield Forgemasters, as he will be aware, the Treasury has asked all departments to look at all spending approvals since 1 January this year, which would include that project. Due diligence is required because of the budgetary position that this Government inherited from the Government of whom the noble Lord was such a supporter, to see whether those plans are affordable and consistent with government priorities. If they are consistent with that, they will go ahead—but that is all that I can assure him of at the moment.

I shall say a word or two about regional development agencies, which were raised by the noble Lord, Lord Bhattacharyya, and the right reverend Prelate the Bishop of Liverpool, who spoke about the regional development agency in my area and his area—the Northwest Regional Development Agency. My noble friend Lord Bates spoke of One North East, the RDA covering Newcastle. As my right honourable friend the Prime Minister stated last Friday, an early task of this Government will be to reform and refocus regional support and the RDAs. Therefore, we will be looking at all the RDAs. He stated that he will assign Ministers and senior MPs to some of our biggest cities with responsibility to work with local communities to help to drive forward economic development by ensuring that blockages in Whitehall are dealt with. We will certainly want to look at the RDAs—but I think that the RDAs in the north might be a special case.

With regard to electricity supply, the noble Lord, Lord Oxburgh, talked about a looming crisis. The noble Lord stressed that there had been, I believe, 17 Energy Ministers in the past 10 years. It seems, then, that while he rather politely put it as a looming crisis of our own making, it is possibly a crisis of the party opposite’s making if it was changing Ministers that often and not making the necessary decisions. We recognise that there is a need for a systemic approach to developing a framework that will both deliver energy security and meet our climate change objectives. We have proposed a set of interventions, including an emissions performance standard, that aim to deliver a secure, low-carbon, cost-effective and competitive energy sector. Our electricity market reform project will ensure that we deploy the right mechanisms in the right way at the right time.

A number of noble Lords talked about agriculture, principally in relation to problems that my noble friend Lady Byford raised about the Rural Payments Agency, which was also mentioned by the noble Lord, Lord Greaves, and others. I declare an interest as a recipient of funds from the RPA as a farmer. We are all aware of the problems within the agency, and the department will be seeing what it can do about dealing with them. We will also be looking at changes, as asked for by my noble friend the Duke of Montrose and others, in the common agricultural policy. I believe, and I think that everyone in this House would accept, that that means genuine reform of the policy. We will certainly push for that as and when we can.

Moving on to some of the issues raised about the Royal Mail and the postal services Bill by the noble Lord, Lord Whitty, we understand the concerns on all sides about the future of the Royal Mail and the real affection in which it is held. However, the Government are now looking at the detail of how to ensure that the Royal Mail can benefit from a degree of private sector capital and discipline and how it can modernise—possibly, as I think one of the right reverend Prelates suggested, in partnership with employees. We will announce details of our plans in due course, but I stress that we will seek to modernise the Royal Mail in conjunction with its employees.

I shall say a quick word about transport, the final department that was covered. We had a great many suggestions from the noble Lord, Lord Bradshaw, some more radical than others. I think that he suggested a purge of an entire division within the Department for Transport; I am not sure quite how brutal that purge would be, but no doubt he can let us know.

We also heard comments from my noble friend Lord Glasgow about high-speed rail being not purely a local English matter but a British matter. Like my noble friend, I have an interest in high-speed rail in that I live more than three and a half hours away from London under the current regime. I refer the noble Earl to the commitments that were made in the coalition document: this will be a truly British high-speed rail network. At this stage, one has to say that the timing is another matter. These things are very expensive but the commitment is there and it is a commitment to a high-speed railway that would be truly British, rather than taking us merely as far as Birmingham or Manchester.

I end by saying, again, that I will in due course write to all noble Lords. I hope that I can answer all the questions that have been put before me. As my noble friend Lady Wilcox said earlier today, any sensible family or business knows the dangers of too much debt. The debt is the first thing that we must concentrate on. We cannot recover without reducing it. That will be the Government’s first aim. I was grateful for the endorsement of the noble Lord, Lord Myners, for that. We must do that while adhering to the values, as my right honourable friend the Prime Minister said, of freedom, fairness and responsibility, and of knowing and respecting the value of our natural environment.