Climate Change
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Lord Callanan (Con)
I cannot promise the noble Baroness that we will support her amendments; I will need to look at them first. But we are doing a lot on skills. For example, the green homes grant included tens of millions of pounds that we spent on grants to encourage providers to provide the training that will be required to undertake many of the green improvements that we all want to see.
Lord Grantchester (Lab)
The Climate Change Committee has called out the Government for the scale of the yawning gap that exists between government rhetoric and the Government’s lack of decarbonisation realities. Can the Minister confirm that the missing net-zero strategy will set detailed timelines for how each element of each missing policy will start to deliver decarbonisation with the required urgency, and then ensure that adaptation to climate change is properly integrated into that plan?
Lord Callanan (Con)
Well, the strategies will provide some of the detail that the noble Lord is looking for. We will set out a detailed road map of exactly how we will meet our net-zero targets, as he suggests.
Republic of Cameroon: Economic Partnership Agreement
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Lord Grantchester
That this House regrets the Economic Partnership Agreement between the United Kingdom and the Republic of Cameroon given (1) the human rights abuses committed by President Biya’s regime, and (2) the lack of parliamentary scrutiny before trading arrangements came into force on 1 January.
Relevant document: 1st Report from the International Agreements Committee
Lord Grantchester (Lab)
I thank the noble Lord, Lord Purvis, for tabling his Motion on Ghana, and I welcome the debate taking place on both of these today. I will necessarily be focusing my remarks on Cameroon, leaving him to focus on the partnership agreement with Ghana, given the importance of tonight.
We have had a very busy couple of weeks of trade developments: CPTPP negotiations launching, an Australian deal being partially announced and the TRA’s recommendations on steel imports coming out. I want to make clear that we on this side want good trade deals that grow the economy, stimulate sectors and protect livelihoods and standards, reflecting the modern approach to trade that goes wider than mere economic exchange. As we ask questions and debate agreements, I want the Government always to remember that.
The Government do not seem to appreciate not only how scrutiny of trade deals should change to reflect the new status of the United Kingdom having left the EU, with all the constitutional arrangements that need to reflect that, but that trade deals need to reflect the new trading realities in the world today, which is undergoing a climate crisis against the backcloth of the pandemic, and where respect for rights, minorities and sustainability needs to become ingrained. These points were repeatedly made during the passage of the Trade Bill through your Lordships’ House last year, when many questions were asked about the future trading policy of this Government. It was repeatedly stated that the Trade Act referred only to rollover deals, with the Government refusing to answer how they would address and adapt the CRaG process to account for these sentiments. I remind the Minister that the CRaG process was set as appropriate for the UK being a member state of the EU.
In the rush forward with these new developments, a theme can be seen and identified where Ministers appear to be prioritising trade at any cost without any clear policies or moral compass, whether that means abandoning the fishing industry, selling out British farmers, failing British steel or abandoning British families. I believe that Cameroon fits into that pattern. Although accounting for only 0.1% of total UK trade, this deal means much more for human rights, scrutiny and future trade agreements.
The first part of my Motion necessarily focuses on human rights violations. Government forces have committed widespread abuse across Cameroon’s anglophone region since 2017. The UN estimates that 3,500 people have died and 700,000 have been displaced. Suspected violations include extrajudicial killings, torture, the destruction of property, fair trial violations and inhumane and degrading conditions of detention. Events in Cameroon have been painstakingly logged by the Faculty of Law at the University of Oxford, with one media report from 20 May 2019 stating that
“the military came in as the mother was struggling to prepare food for the family … The soldiers came in … and shot the child in the back of the head.”
The report goes on to call on the international community to “help us”.
This incident is heartbreaking but not isolated. Human Rights Watch has said that government forces committed widespread human rights abuses throughout 2020, and yet, at the end of that year, our Government agreed to roll over trade arrangements with the regime responsible. Can the Minister simply tell the House why? This was in spite of the Foreign Secretary saying in January that we should not be engaged in free trade negotiations with countries abusing human rights, and in spite of the Minister saying in this House in December 2020, again in February this year, and yet again in March, that trade does not have to come at the expense of human rights.
Clearly, the gap between the Government’s rhetoric and actions is vast, and that is also becoming a clear hallmark of this Government. By signing this agreement, the UK is actually moving in the opposite direction to the US and more enlightened trading relationships. In January 2020, the US terminated Cameroon’s eligibility for trade preference benefits due to the Biya regime’s persistent violations of internationally recognised human rights. Let us not be confused: this was under the previous US Administration. If President Trump can act, why cannot Secretary of State Truss?
On 1 January this year, the same day that the trading arrangement was rolled over by our Government, a unanimous United States Senate resolution was passed criticising the Biya regime for abuses. Just as a media report called on the international community to act, the Senate resolution urged other countries to join a collective effort to put pressure on Cameroon through the use of available diplomatic and punitive tools. The Government will recognise that this includes trade. Your Lordships’ International Agreements Committee has called on the Government to set out the process they plan to monitor human rights compliance that could put Cameroon in material breach of the essential elements in this agreement. Can the Minister explain this process today?
Can the Minister confirm that all future explanatory memorandums to trade deals will include information about significant issues of concern raised by devolved Administrations and how they have been addressed? Looking to future arrangements, can the Minister also explain the UK’s policy on the inclusion of human rights clauses and how they will be reflected in every deal? The recent Norway and Iceland treaty contained no such clauses. While I am not worried specifically about those countries, I am worried about what precedent this sets for agreements with the Gulf states and Brazil.
This returns us to the focus on parliamentary scrutiny. On 27 December, the UK and Cameroon agreed through a memorandum of understanding to bridge the gap between the end of the post-Brexit transition period and a provisional application to maintain the effects of the EU-Central Africa EPA and apply the tariff preferences of the UK-Cameroon EPA, but the MoU was not published until four months later. The Government announced a new deal signed on 9 March but, once again, Parliament did not get to see the text until 20 April, with your Lordships’ International Agreements Committee being able to consider it only on 26 May.
Under challenge from the shadow Secretary of State Emily Thornberry, the Secretary of State replied in a letter dated 7 June that “on this occasion, I do not believe a debate is appropriate”. She referred to a debate having taken place on the continuity agreement in Parliament back when the existing EU agreement was negotiated with Cameroon, but that was only a 14-minute debate back in 2010, with open conflict against the English-speaking population in Cameroon beginning in 2017.
I pay tribute to the Minister for the many times that he has committed the Government to proper parliamentary scrutiny. I know that he will remember doing so during the Trade Bill and in answering many Questions and making Written Ministerial Statements. Indeed, his pronouncements have been codified into the “Grimstone rule”. I know that he is committed to good governance, even under the outdated CRaG process.
It is disheartening to witness the actual interpretation of scrutiny arrangements by this Government—
Baroness Scott of Bybrook (Con)
I am really sorry, but we have a time-limited debate; you will have to finish.
Lord Grantchester (Lab)
I have listened carefully to all the contributions expressed in this debate on scrutiny and trading arrangements. I thank the noble Lords, Lord Kerr and Lord Lansley, for speaking as Members of your Lordships’ committee that examined these agreements, and I thank the committee for its report. The remarks of the noble Lord, Lord Bellingham, with his experience, were particularly pertinent. The contrast between Ghana and Cameroon and their agreements has been interesting and I thank the Minister for the attention that he has given in his replies.
The debate signals the importance of getting scrutiny right in every circumstance. In this deal, adding further areas of negotiation to the deal after it has been signed raises questions about how it can be effectively scrutinised and how the Government can be held to account. This has been a very useful occasion for the House to gain experience in debates on international trading arrangements following Brexit.
I do not raise the matter of voting against one of the Government’s trading agreements lightly. However, given the outcome of the Biya regime, it is of great regret that the Government have not treated this element of an international trade agreement with the seriousness it deserves. The Motion has certainly produced a mixed response. However, to underline that this is a Regret Motion, we must underline our commitment to the most stringent levels of scrutiny with a vote, and I beg leave to test the opinion of the House.
Free Trade Agreement Negotiations: Australia
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Lord Grantchester (Lab)
My Lords, I thank the Minister for his letter and the Government for their update on the progress of the UK’s trading relationship with Australia. I had been waiting for the detail, following the announcement at the end of the G7 conference, as it seemed from reports that nothing had been signed and was unlikely to be before October or November this year. The information was released under the cover of darkness, on the night of 17 June. I imagine this was the time that Tony Abbott, on behalf of the Secretary of State, signalled agreement with the Australian counterpart, Dan Tehan. The information reveals it to be a series of commitments that the Government have entered into to agree many details yet to be worked up. Can this be described as “historic”, as claimed in the Statement?
These commitments were translated into negotiating wins for the Government: tariff reductions for UK exports of food, drink, clothing and cars; provisions for the under-30s to work in Australia to be extended to those under 35; and reductions in barriers for services exports, and data and digital exports. I certainly congratulate the Government on them, but none of these so-called wins has ever been controversial or problematic for Australia. Its tariffs on UK goods were already very low, and making it easier for young people to work in Australia is a positive boost to the Australian economy, particularly its farming industry, which relies on casual labour from British backpackers.
What do the Australians make of these commitments? Would the meaning of “historic” be revealed on their website? Indeed, yes, as the Australians could not believe what they had achieved. Yes, it was only, as they put it, an agreement in principle—AIP—but, to them, these commitments are locked in to benefit Australian farmers and workers, as well as their consumers. We begin to see a different perspective: one that highlights the fears of the farming industry throughout all parts of the UK, and perhaps suggests why the Secretary of State for Defra was so alarmed in Cabinet.
The Government describe the agreement on beef and sheep as securing 15 years of capped, tariff-free imports, while the Australians state it as 10 years, as the subsequent five years include enough significant extra volumes as to be pretty meaningless. But the cap on volumes rises in significant leaps, all without tariffs, in complete contrast to the agreements the Australians had achieved in recent deals with Japan, China, the USA and South Korea, where tariffs on their beef were reduced gradually in the various deals between 10 and 18 years, with additional safeguard triggers.
This deal has historic elements for Australia. The trade expert and former Australian negotiator, Dmitry Grozoubinski, described it as follows:
“I don’t think we have ever done as well as this. Getting rid of all tariffs and quotas forever is virtually an unprecedented result.”
Has the Minister worked out what this means for the UK? We await the impact assessment and the reconstitution of the Trade and Agriculture Commission to assess the AIP, as required in the Agriculture Act and Trade Act, as secured by your Lordships’ House last year. In the meantime, it seems to mean that Australia would be able to increase its beef exports to the UK to more than 60 times their 2020 levels in the first year before any quota would apply. Australia could export four times more beef to the UK in the first year of the deal than it did to the whole of Europe in 2020 before any quota would apply. Indeed, the UK would leap from 27th place to sixth in the global ranking of Australia’s biggest beef exports markets if Australia were to use its full quota in the very first year.
This commitment offered to the Australians has triggered an array of angry responses from agriculture in all corners of the UK, especially the devolved Administrations, where agriculture is such an important part of their economies. The Welsh have particular concerns for their lamb, and Northern Ireland for its dairy trade. While Scottish whisky producers will be pleased, Scotland’s agricultural input suppliers will be concerned, along with its beef producers.
Environmental groups, animal welfare groups, consumer groups on food and nutrition, and trading bodies are all concerned: Greenpeace, the World Wildlife Fund, Compassion in World Farming, and the National Trust are all alarmed. Sustain points out that Australia has no model conditions for animal welfare and no federal animal welfare legislation, opting instead to devolve responsibilities to states and territories. The world animal protection index, which ranks 50 countries according to their legislation and policy commitments to protect animals, has awarded Australia a D mark, versus a B for the UK. Being the first deal that the Government have signed after leaving the EU, even if only in principle, how will they negotiate their further ambitions to achieve deals with other countries, such as America and India? The Statement proclaims that this deal is only a precursor to the CPTPP deal that the Government have set their ambitions on next. Australia is committed to helping the UK sign up to this existing CPTPP deal without any changes or protections, as a deal taker not a deal maker. Do the Government see UK agriculture as a sacrifice worth giving up on the way to this further agreement?
The Government are truly making a hash of Brexit. The UK has left the EU, to be sure, but so far the Government see more mileage in being anti-EU than in being pro-British. The Secretary of State compared this deal to trade with the EU in her replies last week in the Commons, but our neighbours in Australia are not 20 miles away. First-quarter exports to Europe were down £2 billion during the first part of 2021. Sales of dairy products plummeted by 90% after the trade and co-operation agreement was signed at the last minute in December. As far as Europe is concerned, it seems that nothing is agreed until everything is agreed. As far as Australia is concerned, everything is agreed while nothing is detailed.
The Government are hopeless on trade after Brexit. Northern Ireland is in turmoil. The fishing industry, whose voice was so strongly for Brexit, has already been sacrificed. The steel industry is collapsing and farmers who also wanted Brexit to be successful for them have already had £255 million slashed from their budgets this year in reductions to BPS payments. The Welsh football fans are certainly unhappy that they cannot visit Amsterdam to support their team this weekend.
Many important questions remain. I finish by asking just a few. The interim Trade and Agriculture Commission made a series of important recommendations, including for the establishment of a new national framework of food and farming standards, against which all future trade deals could be judged. Can the Minister explain why there has not been a formal response to the commission’s report and why that national framework of standards is not yet in place? Have the Government made plans regarding a proper labelling of Australian beef, so that consumers can identify it clearly on menus and supermarket shelves? Have the Government demanded that the Australians raise their standards in correspondingly high leaps over the years in tandem with the increase in their agricultural supplies? Finally, what will be the cumulative impacts from all the deals that the Government plan if these follow the precedent of the Australian deal, or do the Government have plans to rescue the farming industry from the disaster that it sees ahead?
Lord Purvis of Tweed (LD)
My Lords, I thank the Minister for his letter of 18 June with a copy of the agreement in principle and an explainer. He is very good at keeping the Front Benches informed in the House, which is appreciated.
These Benches that I speak for want more free, fair and open trade, for the UK to export more and for UK consumers to have a wider choice of higher-standard goods at globally competitive prices. We want trade deals to reflect growth in UK export potential, but we want them strategically used for wider social, climate, human rights, labour and environmental standards. We do not want them to be an opportunity for the UK to miss, to provide market access for other countries without commensurate or better gains for us.
The desperation of this Government to have any deal, no matter what, is noted among our trading partners, and they take advantage. A bad deal is better than no deal, it seems. On the much-heralded £15 billion Japan deal, £13 billion was for Japan and £2 billion for the UK. On this deal and the agreement in principle, UK exports to Australia will go up over 15 years by £500 million, the Government say, while Australian exports to the UK will go up by £700 million. That is about three royal yachts. The telling point on market access was in the bullet point that
“both sides formalise their agreement on splits of TRQs at the WTO and Australia withdraws its objections to the UK’s goods schedule.”
That was the giveaway. Australia has got exactly what it wants. It has withdrawn its objections at the WTO—objections which, I remind the House, this Government said had no foundation. It turns out that our negotiation had rather weak foundations. I co-chaired, with the Nigerian Trade Minister, a commission of inquiry looking at areas where we can expand Commonwealth trade. Why is there no reference to the Commonwealth in this agreement?
However, let me quote positively from the website of the Australian Department of Foreign Affairs and Trade:
“an ambitious and comprehensive FTA will assist with post-pandemic economic recovery by providing new opportunities in a highly significant market for Australian goods and services. It will provide Australian exporters with a competitive edge and more choices about where they do business. Australian consumers and companies stand to benefit through greater choice in goods and services at lower prices.”
That is the headline of the Australian Government of the agreement with the European Union, now in its 11th round. The Australian Government go on to say:
“We want an FTA with the EU to set the benchmark for what can be achieved between like-minded partners.”
The narratives for the EU and the UK are remarkably similar. The UK scoping exercise for this, an ambitious and comprehensive FTA for Australia, said that it would bring GDP growth ranging from 0.01% and 0.02% over 15 years. The EU scoping exercise in 2018 said that
“an ambitious and comprehensive FTA will bring about GDP growth ranging from 0.01% to 0.02% over 15 years.”
Why has a Brexit agreement no greater benefit than we would have had anyway? On goods, we are expecting an increase in exports of up to 7.4%, which is of course positive. In the Government’s own document, Australia is looking for exports to the UK to increase up to 83.2%. Why is there such a difference? It is estimated for the EU scoping exercise that EU exports to Australia could go up under their agreement by one-third. Why are UK exports up by 3.6% and European exports up by 36%?
On legal services, the Minister said to me on Tuesday that:
“It will contain provisions on legal services, as we have heard, but it will not confer the automatic ability for Australian lawyers to practise law in the UK.”—[Official Report, 22/6/21; col. 163.]
The fourth bullet point of the agreement in principle mentions:
“Legal services provisions which will both guarantee that UK and Australian lawyers can advise clients and provide arbitration, mediation and conciliation services in the other country’s territory using their original qualifications”.
I regret to say this, but I believe that the Minister misled the House. I hope that he has an opportunity to correct that at the Dispatch Box today.
Can the Minister explain why in the agreement there will be a chapter on mobility, which could well be positive, about companies sponsoring
“visas committed in the FTA without first having to prove that a national of the country in question could not be hired to do the job, through the reciprocal removal of economic needs”?
Is this now a direct repudiation of the points system that the Home Office has put in place, and, which will be the case—the UK Home Office points system for Australia or this trade agreement? On goods, during the trade negotiations the Government’s press release in November said that the Government had a suite of tools including tariffs, tariff quotas and safeguards to ensure that British farmers, with their high standards, were not unfairly undercut in any trade deal. However, the NFU said that it was not consulted, and none of these methods seems to have been used.
We know that, according to Food Standards Australia New Zealand—FSANZ—around 40% of cattle are given hormone treatment, but the quotas for imports are currently for accredited hormone-free cattle. There is no differential quota guarantee in this outline agreement; will it be in the final agreement? Neonicotinoids are used on Australian crops—cotton, canola, cereals and sunflowers—but their use in the United Kingdom is banned. What guarantees are there that we will not import goods for which illegal pesticides have been used as part of their production? What guarantees are there that we will not import sows that have been reared in sow stalls, which have been banned in the UK since 1999? What guarantees are there that pigs raised by intensive farming methods and chickens reared in battery cages, which we have banned, will not be imported?
Finally, it is of course a fallacy to suggest that, if we are critical of this agreement, we are critical of free trade. We are critical of the Government’s ability to negotiate good trade agreements. If imported goods are cheaper, the Government say that they will safeguard against undercutting—but that is not in this agreement. Workers with skills having to get a visa because of economic need is not mentioned in this agreement. The continuing protection against hormones and pesticides that Defra has indicated is also not in this agreement. Who is in charge of our agriculture, immigration and economic policy?
Covid-19: Vaccine Production
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Lord Callanan (Con)
There was a lot in those questions. The best way to facilitate this is through the COVAX initiative. The UK is proud to be one of its largest funders. We have helped to raise almost $1 billion for that initiative, which is helping to supply vaccines to 92 developing countries across the world.
Lord Grantchester (Lab)
The G7 leaders’ communiqué notes
“the positive impact that voluntary licensing and technology transfer on mutually agreed terms have already made to increasing global supply.”
But untransparent exclusive bilateral voluntary licences from pharmaceutical companies have led to the grossly insufficient quantities of Covid-19 vaccines that we see today. I return to the line of questioning of the noble Baroness, Lady Bryan, and the noble Lord, Lord Purvis: will the UK Government not continue to miss the point but instead use their initiative and push pharmaceutical companies to share intellectual property and tech through the World Health Organization’s Covid-19 Technology Access Pool?
Lord Callanan (Con)
My Lords, the intellectual property for the AstraZeneca vaccine, as is known, is actually owned by the University of Oxford. We will of course work with the companies and everyone possible to make sure that the third world is vaccinated, because that is in our interests. That is why we have contributed so much to the COVAX initiative.
Climate Change Act 2008 (Credit Limit) Order 2021
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Lord Grantchester (Lab)
Once again, the Committee meets to consider important matters concerning climate change. I thank the Minister for his explanation of the order before us. It follows the well-worn pathway of setting credit limits for the first three carbon budgets of 55 million metric tonnes of CO2 equivalent as flexibility insurance in meeting the UK’s legal obligations. As we have seen, there has been no need to utilise these credits for the first two carbon budgets, and the UK is on target to meet the third carbon budget. The Government are to be congratulated on that. They are also to be congratulated on accepting the advice of the Climate Change Committee on setting the carbon budgets. Last week, the committee approved a sixth carbon budget for the years 2032 to 2037. This CCC advice was endorsed also by the devolved Administrations.
However, there, the congratulations must end. It has not been generally accepted, as the noble Lord, Lord Oates, queried, that the Government are on course to meet the fourth and fifth carbon budgets and they have had to have a reset, with additional targets, to get back on track, as we discussed last week. The Government have gathered in the low-hanging fruit from earlier years, referred to by the noble Lord, Lord Bradshaw, and done the least development possible, paring back the budget and policies from necessary support for climate action.
The Government have now responded on the realisation of the climate emergency by setting net-zero targets for 2050 in accordance with the Paris Agreement to limit global warming, but they continue with self-congratulatory rhetoric, setting targets without clear action plans. As we discussed last week, they must come forward with policies, plans and strategies and engage in meeting these budget commitments.
It must be recognised that this order, which sets the traditional credit limit, goes against the advice of the Climate Change Committee, which was again endorsed by the devolved Administrations. That advice was to set a nil credit limit—that is, not to allow the purchase of carbon credits from overseas. Yes, none has been required in the past, but the CCC is right in its determination that the UK must meet its carbon emissions reductions domestically. It recommended that international emissions credits should not be allowed to be used to meet the fourth carbon budget and, furthermore, that any surplus from the third carbon budget should not be carried forward.
It is recognised that the UK Government intend to meet the new NDC and the 2030 target without the use of international credits. Inventory uncertainty projections and forecast inaccuracies are also recognised —they have always existed—but it is now time for clear actions, real leadership and determined signalling that the UK is meeting its obligations entirely through its own domestic obligations, as well as now taking the lead on international aviation and shipping.
I have just one question on the future development of policy. One necessary priority must be the development of batteries and energy storage; the noble Lord, Lord Bourne, identified this in his appreciation of this order. Can the Minister outline where and in which strategy and plan this priority will be answered by government plans, among the many opportunities they have identified?
The Deputy Chairman of Committees (Baroness Healy of Primrose Hill) (Lab)
I call the Minister. Oh—my apologies.
Lord Grantchester (Lab)
I am nearly finished.
The reasons given in the Explanatory Memorandum for continuing with budgetary insurance are no longer convincing. Sufficient flexibility must be managed through domestic commitments; offsetting is not a sustainable way forward. Unforeseen circumstances cannot provide a justification, and the UK has not previously contributed to the development of the global carbon market with any impact. The opportunity to purchase credits will only diminish as the world steps up with commitments to decarbonise. Consider the damage that would ensue should the Government need to go ahead with a carbon credit. They must self-insure and develop robust policies and plans to meet all the carbon budgets with clarity and certainty.
This is a missed opportunity that the Government could have taken as a decisive step, in this decisive decade, toward emissions reductions. This conclusion was also recognised by the noble Baroness, Lady Jones, in her remarks. The 2030 NDCs submitted at the UNFCCC last December should have set the tone. The sixth carbon budget will require more ambition and the pace of change to accelerate over the coming years. The confidence that could have been set by a zero-credit limit in this order needs to be corrected by the determination and announcement of policy developments before COP 26 later this year. I look forward to seeing the UK outperform and deliver. Labour understands the size of the task. The challenge is set.
Carbon Budget Order 2021
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Lord Grantchester (Lab)
I am grateful to the Minister for introducing this order today. It is not a moment too soon. We are in the midst of a climate and environmental emergency, and all steps to meet the challenge are welcomed and encouraged.
The strengthening and development of policies are clear imperatives and follow the pathway of Labour’s ground-breaking Climate Change Act 2008. The Conservatives slowed momentum following the majority Cameron victory in 2015 with the result that the UK is no longer on track to meet the fourth and fifth carbon budgets for the years 2023-27 and 2028-32. This carbon budget—the sixth, for 2033-37—necessarily has to reset the pace. I am grateful to the Climate Change Committee for its purposeful determination in recognising the problems and coming forward with robust recommendations. Inevitably, the Government’s slow realisation and slow pace mean that this budget demands deeper and more stringent action to get the UK back on track, not only to meet the old targets but to meet the new pressing targets and the international obligations of the Paris Agreement 2015.
I congratulate the Government on resetting the targets and legislating for net zero by 2050. Following the recommendations of the Climate Change Committee, this order is the next step towards determining that pathway by setting the carbon budget—the maximum volume of greenhouse gas emissions that can be emitted —for the period 2033-37.
Let us recognise that although this is a small step, it is a crucial one. Now the Government must bring forward their policies and proposals for the UK to achieve this. That means the Government must close the existing £22.4 billion gap in net-zero spending, according to Green Alliance, for the duration of this Parliament. They cannot do this through wishful thinking or self-congratulatory soundbites. This is the decisive decade for climate action. The substantial majority of UK emissions must be cut by the end of the 2020s, as the world must get to net zero well before 2050.
The CCC’s recommendations include a more ambitious scenario of 87% rather than 78% reductions by 2035, based on greater public engagement and faster innovation, which reflects the urgency of the situation and the nation’s capacity to respond. Gaps must be filled. I am grateful to the CCC for recommending for the first time making international aviation and shipping—responsible for 10% of UK emissions by 2018 figures—now subject to domestic inclusion in this budget, and to the Government for finally recognising this clear imperative.
Net zero will involve big changes to everybody’s daily lives. The UK can reach the target and stem climate change only with the support of the public, companies, business, the Government and all their agencies, and the devolved Administrations. I thank the International Energy Agency for its international net-zero pathway modelling on a global scale, identifying the annual additions of renewable energy needed, the energy efficiency increases necessary and the technology that is ready or near to market. It recognises battery and energy storage as vital areas for urgent development.
The Government must come forward with far more than a scattergun 10-point plan. Carbon Brief has recognised that, while the UK has committed £8 billion to green recovery this year, Germany has invested £38 billion and France £31 billion, and the US has committed $1 trillion to green initiatives under the President’s green infrastructure plan. The totality of the scattergun 10-point plan promises only £54 billion of public and private investment over the next 10 years put together. Green Alliance estimates that policies announced in 2020 will lead to only 26% of the reductions necessary to get the UK on track to meet its 2030 target.
At the time of the scattergun 10-point plan announcement in November 2020, the Government had a plethora of missing strategy documents which will be needed to map out the necessary policies within a framework to produce a comprehensive agenda so that industry and the public can respond. With the CCC’s recommendations now accepted and enacted in this order, the Government must issue these policy statements as soon as possible.
I thank the Minister for responding with the Government’s energy White Paper and the industrial decarbonisation strategy. Clearly, this order necessitates urgency for the net-zero strategy, which will need to be supplemented by the transport decarbonisation plan, the hydrogen strategy and the heat and buildings strategy, among other things such as a public engagement plan, discussed in your Lordships’ House recently. The Government have promised the necessary net-zero finance review from the Treasury in September.
The noble Lord, Lord Lansley, identified carbon capture and storage, and the noble Lord, Lord Moynihan, identified heat pumps for new homes. Plus, a comprehensive plan now has to be set out, ruling out anomalies in carbon pricing. Can the Minister confirm that the urgency of the situation will be met with the publication of all these strategy documents, with policies, before COP 26 this November? Does he recognise the value of being ready to provide leadership to the conference? Can he tell the Committee how the Government propose to tackle the requirement to include international aviation and shipping in this sixth carbon budget? This is necessarily part of transport, but will it be addressed separately, as it is clearly a more difficult challenge that must now be faced?
The noble Lord, Lord Oates, spoke of the initiatives put forward by the French Government. Will this Government come forward with better solutions for energy efficiency following the collapse of the green homes grant scheme? How do they propose to encourage the uptake of electric vehicles, especially by low and middle-income families, and to remove the up-front costs barrier? Does the Minister favour Labour’s plan to offer interest-free loans for new and used electric vehicles? How will the Government accelerate the rollout of charging points in streets?
Labour calls for a green economic recovery, with the delivery of high-skilled jobs in every part of the UK as part of the drive towards a decarbonised—
Baroness Scott of Bybrook (Con)
Can I remind the noble Lord of the seven-minute speaking limit?
Lord Grantchester (Lab)
I can see that it is 24 seconds past the minute. I have another 15 to 20 seconds to speak, and then I will finish. I thank the noble Baroness, though, for reminding me that the clock is ticking.
Will the Government come forward with a new skills plan? With so many issues to cover and so much urgency needed for ambitious plans, I am pleased to approve the order before the Committee.
Contracts for Difference (Miscellaneous Amendments) Regulations 2021
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Lord Grantchester (Lab)
Once again, I thank the Minister for his explanation of the regulations before the Committee today. They amend a number of regulations covering contracts for difference, as well as the general regulations for electricity market reform.
The aforementioned contracts for difference cover the definition of eligible generator by removing biomass as a qualifying generation to apply for a CFD. I welcome this change, as biomass has largely fulfilled its purpose of replacing coal-fired power stations with renewable energy fuel. Now that electricity generation has become less carbon intensive, continued supply of woodchip has caused controversial activity to be reassessed.
In relation to contracts for difference regulations, these regulations also amend the allocation regulations by including floating offshore wind as eligible to apply for CfD funding. Through the consultation process, other minor improvements and better drafting to aid clarity have also been identified, such as supply chain plans and period definitions to application rounds to provide better certainty to applicants. Thus these regulations bring many improvements and developments to the CfD process. As an initiative to incentivise investment in low-carbon electricity generation and bring forward renewable sources of energy while improving affordability for consumers and maintaining energy security during energy market reform, the CfD regime has been largely a huge success. While there has been controversy over the setting of strike prices for specific technologies, the mass deployment of renewables has led to more competitive renewable generation and better energy efficiency. The consultation process has been very productive and the resulting redrafting of guidance is also very welcome. Can the Minister give any indication of when National Grid and the Low Carbon Contracts Company will publish their updates to reflect these changes? In turn, the Minister’s department intends to publish an updated version of its supply chain plan guidance. Will the Minister commit to publishing it well in advance of the next CfD allocation round?
Floating offshore wind is an interesting development that the Government have identified as potentially a very productive new source of energy generation. Will the Minister expand a bit on the operation of pot 2 as a separate budget for less-established technologies to which floating offshore wind will have to apply? What is the size of this pot in relation to the more recognised pot to which established technologies would apply? What have been the relative awards total between the two pots in the past and what is the breakdown of those awards? I will be happy to receive a letter with more detailed information from the Minister rather than take up the Committee’s time now. I merely wish to understand how new technologies are supported in relation to the generality of technologies and when a new technology will graduate, and by what defining characteristics, from one pot to another. Can the Minister say in any meaningful way at the moment what strike price might be awarded to offshore floating wind in relation to strike prices for the various stages of conventional fixed offshore wind? With that, I approve the regulations before the Committee.
Pollution Prevention and Control (Fees) (Miscellaneous Amendments) Regulations 2021
Lord Grantchester Excerpts(2 years, 11 months ago)
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Lord Grantchester (Lab)
I, too, thank the Minister for his introduction to the regulations before the Committee. It was necessarily detailed. The Explanatory Memorandum was fulsome in listing all the various regulations under various Acts of legislation where cost recovery is now embraced as part of government policy and fee schemes are introduced. His department is to be commended for the coherent analysis of fees payable by the offshore hydrocarbon industry and Ofgem to the Offshore Petroleum Regulator for Environment and Decommissioning—OPRED—for certain activities. I now understand better the Treasury’s Managing Public Money guidance on the methodology of cost-recoverable activities.
I have very few questions about these regulations. However, to start with, can the Minister confirm whether OPRED is entirely cost neutral to the taxpayer and that all its costs are recoverable? I thought I heard him say that its full budget of £6.2 million was recovered from industry. I think that is correct and that OPRED prevents a lot of possible pollution occurring.
The cost recovery system appears entirely non-judgmental—that is to say, there appears to be no analysis of the cost increases against any parameter. The noble Baroness, Lady Jones, called the increase negligible. However, I note that the cost increase of £7 per hour for both specialist and non-specialist staff in tandem is slightly above the rate of inflation. As the increase is in tandem to two different rates, it is not by any defined percentage consistently. Will the cost recovery system in the department in this instance be reviewed on any regular basis? I would not expect the policy to be changed into a profit centre.
From this, it can be asked whether and by what means costs are controlled. No doubt it is by the wages policy undertaken by public bodies such as OPRED and under the influence of HM Treasury. I am sure that any validation of cost increases across any organisation is not necessarily a smooth process. As the noble Lord, Lord Bourne, expressed, the future of the infrastructure on the continental shelf will become very important for the urgent development of CCUS and hydrogen. With that, I am happy to approve the regulations today.
Ecodesign for Energy-Related Products and Energy Information Regulations 2021
Lord Grantchester Excerpts(2 years, 11 months ago)
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Lord Grantchester (Lab)
Once again, I thank the Minister for his introduction to the regulations. They seem to be simple, straightforward updating regulations to continue the in-built progress to consumer standards from increases in product developments. This raises energy performance and efficiency standards in electric motors, various household goods and now, for the first time, welding equipment and commercial refrigeration. Has welding equipment become an everyday item in the marketplace?
I am pleased to the see that the Government are being practical and sensible in resisting the temptation to insist that the UK undertakes its own post-Brexit consumer products standards. While these standards were agreed by the UK as a member state, I trust that the Government will continue with this alignment. Independent standards would be extremely tedious in relation to the Northern Ireland protocol and would add greatly to costs generally.
As these regulations continue with the updating practice that existed before Brexit, I presume that trading standards will be able to pick up the changes relatively smoothly. Since monitoring of regulations and post-implementation reviews will continue, does the Minister foresee any problem resulting from these regulations across any part of the United Kingdom? The full 29 schedules covering online labelling and internet selling would suggest that the department is following well-worn pathways and extending these to welding equipment with practised ease.
If I may, I will make one consumer observation on product development. I do not often stray into the market for vacuum cleaners but, when I have done so, I have seen that generally the most powerful machines become irreplaceable with powerful replacements no longer available. Does the insistence on energy-saving improvements necessarily rule out the continuation of more powerful machinery in the marketplace? The more power that is needed tends to lead to these more powerful machines being withdrawn. Do the minimum energy performance standards—MEPS—need to take account of the range of options available within the average energy efficiency of all products in a product category? There may be other cases in the household product marketplace. Does the Minister have any insights from the department on this aspect?
I am glad that repairability is now being recognised as important. As the noble Lord, Lord Oates, remarked, it does seem rather unusual under paragraph 7.8 in the Explanatory Memorandum to bring in regulations on ecodesign and energy labelling before any of the standards for the requirements are available to be designated, due to ongoing development work. While I appreciate that the GB market must be protected from the risk of the dumping of less efficient products, should these regulations not be implemented in tandem with the EU, can the Minister explain why this is happening in this case? With that, I am happy to approve the regulations today.
Agricultural Exports from Australia: Tariffs
Lord Grantchester Excerpts(2 years, 11 months ago)
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Lord Grantchester (Lab)
In the UQ Answer, the Government were adamant that:
“Any deal we strike will contain protections”
and said that
“any liberalisation will be staged over time, and any agreement is likely to include safeguards”.—[Official Report, Commons, 27/5/21; col. 549.]
Can the Minister now provide any details? Has any information been provided? We need to know the elements of any agreement now.
Is there any independent governance of trade deals and tariffs? Your Lordships have received any number of letters co-signed by the Minister and his counterpart in Defra; there was one dated 1 November on trade and standards. Does any parliamentarian have access to independent and expert advice when reviewing the impact of each trade deal on agriculture? Is there any impact assessment? Is there any trade and agriculture commission to provide any report? Why is there any disagreement in Cabinet? Why do the Secretary of State for Defra and the previous Secretary of State disagree? Does the Minister have any answers?
The Minister of State, Department for Business, Energy and Industrial Strategy and Department for International Trade (Lord Grimstone of Boscobel) (Con)
The noble Lord has made a number of points, but I will deal with the most significant. On the TAC, both the Agriculture Act and the Trade Act require the trade and agriculture commission to be in operation before the FTA is implemented. It is currently being established and expressions of interest to assemble the commission are out, so it will be able to report on the Australia free trade deal if it comes into effect. That report will be made available to the House. On safeguards, of course we recognise the need to reassure farmers and rural stakeholders that our market access proposals will not threaten sensitive sectors. The deal will include safeguards to defend the industry against import surges and the precise details of these are still being negotiated.