Lord Tunnicliffe
Main Page: Lord Tunnicliffe (Labour - Life peer)
Lord Tunnicliffe (Lab)
My Lords, I congratulate the noble Baroness, Lady Bennett of Manor Castle, on securing this short debate. The speakers’ list may be short, but it is perfectly formed. The Question before us and the guidance it refers to may be highly technical in nature, but it is hugely important. It also follows on nicely from Monday’s Oral Question on the extent to which government departments are adopting National Audit Office guidance on climate-related risk. Before turning my attention to the Green Book, I would like to wish luck to everybody involved in the delivery of COP 26. The Prime Minister has sought to manage expectations in recent days, but it is in all our interests that the summit is a success. Recent Environment Bill debates on topics such as air and water quality do little to instil confidence that the Government are willing to show the type of global leadership that is needed. However, for the next two weeks we must work together to achieve the best possible outcomes for the planet.
The Government’s recent review of the Green Book was triggered by their wish to level up poorer parts of the UK, amid concerns that the previous guidance was preventing investment reaching such communities. The outcome has been to place greater emphasis on the strategic case of a project from the very beginning. Officials are told to present their projects in the context of the Government’s political priorities, in the hope of ensuring that the “right” projects progress to the benefit-cost ratio stage. The impact of projects on carbon emissions will need to be considered as part of the appraisal process, which is welcome. A number of other green strands feature in the Green Book, although contributing to the 2050 net-zero target is not quite the prerequisite one might expect.
The Dasgupta review included consideration of important areas such as how to boost recognition of the value of natural capital. While some metrics have been introduced, that review expressed concern that few business cases were making use of them. Unfortunately, there is little sense that the latest Treasury guidance addresses those issues. Dasgupta is not the only person to voice such concerns. An upcoming report by the UK100 network of mayors and local leaders will argue that government financial decisions fail to give sufficient weight to environmental and health benefits when deciding policy. They also worry that not enough emphasis is put on the potential savings and benefits of decarbonisation.
This intervention is timely as it follows the outcomes of the Treasury’s review of discount rates, which are central to this debate, and the Department for Business, Energy and Industrial Strategy’s updated valuations of greenhouse gas impacts. Both were published last month. The decision not to update the discount rate for long-term environmental benefits is predicated on the notion that under the revised guidance, initial forecasts of costs and benefits can be improved. One would certainly hope that the accuracy of such assessments will be boosted but it appears a risky strategy. Indeed, in correspondence with the Commons Treasury Committee, the Treasury’s Permanent Secretary conceded that the methodology for assessing environmental impacts of projects
“will always to some extent be ‘work in progress’”.
The Minister may be tempted to say that if the current approach does not work, a new iteration of the Green Book will take that into account. This may be true, but it will not account for the missed opportunities between times.
Another workstream being undertaken by the Treasury is the development of a dedicated means of valuing biodiversity during the benefit-cost ratio stage. Your Lordships’ House has just had a series of major debates on biodiversity as part of the Environment Bill, and the Government have set themselves the target of halting what they call “species abundance” decline by 2030. How does the Minister envisage the Green Book contributing to that target and when are we likely to see the new metrics?
It is hard to achieve absolute perfection in any bidding process. In a sense, we are always playing catch-up as guidance is designed to reflect and promote best practice, rather than adopt experimental approaches. Nevertheless, the outcomes of the Green Book review point to a certain lack of ambition in terms of securing environmental improvement and striding, rather than shuffling, towards the 2050 net-zero target. That same lack of ambition can be found elsewhere in government policy—indeed, in too many areas to list. That would appear to undermine the UK’s presidency of COP 26. For now, we must trust that Ministers have a grand plan, first to secure the commitments needed in Glasgow and then to start delivering on the promises made. If they do not, I am that sure your Lordships’ House will have much to say in the future.