Oral Answers to Questions

Caroline Lucas Excerpts

Tuesday 24th January 2012 Commons Chamber

[Danny Alexander]

My right hon. Friend has worked assiduously on behalf of his constituents to ensure that the enterprise zone includes the port of Blyth and the land at East Sleekburn, which will enable private sector firms to come into the area blighted by the problems at Alcan. Capital allowances will of course be available within the enterprise zone, and that will certainly include this territory.

[Caroline Lucas (Brighton, Pavilion) (Green)]

The huge reserves of coal, oil and gas held by companies listed in the City of London have been called a sub-prime asset, because the global drive to reduce emissions is likely to cause fossil fuel reserves to lose value. Has the Minister any plans to ask the Financial Policy Committee to examine the impact of over-exposure to high-carbon assets by London listed companies, and what other plans has he to remove the carbon bubble from our financial system?

Energy and Climate Change

Caroline Lucas Excerpts

Tuesday 20th December 2011 Commons Chamber

[Caroline Lucas (Brighton, Pavilion) (Green)]

Thank you, Madam Deputy Speaker, for calling me to speak in this debate. The international aim of limiting the impact of climate change to so-called acceptable consequences is, according to current trends, set to fail. That is notwithstanding the fact that the Energy and Climate Change Secretary told the House last Monday that the Durban climate conference

“was a clear success for international co-operation.”—[Official Report, 12 December 2011; Vol. 537, c. 569.]

The executive secretary of the UN framework convention on climate change saluted the countries that had made this agreement, but the executive director of Friends of the Earth called the Durban agreement

“an empty shell of a plan”

that

“leaves the planet hurtling towards catastrophic climate change.”

Others were even less diplomatic.

The gulf between these different reactions reflects the gulf between the reality of the current political process and the reality of what the science tells us we need to do. Indeed, it says it a lot about people’s expectations that, after so many climate talks and empty pledges over the years, an agreement “in principle” to tackling climate change from 2020 can still be hailed as an overall success.

There has for a number of years been almost universal agreement on the need to keep climate change within a range that would limit its impact to a so-called acceptable level. That is the risk that Governments have decided they are willing to take on our behalf, and on the whole, the public have accepted this position in the belief that we will be spared from “dangerous” or “very dangerous” climate change.

The threshold between “acceptable” and “dangerous” climate change has been the famous target of limiting warming to no more than 2° C above pre-industrial levels, which, in theory at least, is the limit that international negotiations are striving not to breach. But today the fight to ensure that the planet and its people suffer only the “acceptable” consequences of a warming world faces a double threat.

First, Governments have so far failed to take the action needed to protect their current and future populations from the worst of climate change. Writing in the Royal Society’s journal earlier this year, a group of leading climate scientists explained that

“the continued rise in greenhouse gas emissions in the past decade and the delays in a comprehensive global emissions reduction agreement have made achieving this”—

2°—

“target extremely difficult, arguably impossible, raising the likelihood of global temperature rises of 3°C or 4°C within this century.”

The consequences of the latest weak and delayed agreement are laid bare by Fatih Birol, the chief economist at the International Energy Agency, who has said:

“If we do not have an international agreement, whose effect is put in place by 2017, then the door to”—

holding temperatures to below 2° of warming—

“will be closed forever”.

The second threat is that, as the latest science shows, even a 2° temperature rise is too much. Indeed, the evidence now points to the need to keep global temperature increases to less than 1.5° at most. So it is deeply worrying that, according to the world’s leading climate change monitoring programme, average temperatures are 1° higher than those in the 1950s. Current research released in the run-up to the Durban conference, including work from the Potsdam institute, the Met Office’s Hadley centre, the United Nations Environment Programme and the International Energy Agency, shows that on average the world is expected to warm by at least 3.5° by 2100. If that is an average, the grim reality is that some parts of the world are likely to be warming significantly more.

I raise these issues because it is crucial that we base our climate policy on the best available science. The clearest expression of the accumulation of emissions and the atmospheric concentration of greenhouse gases was given by the European Environment Agency. The latest data show a concentration of 399 parts per million of CO₂ equivalent. The UK’s current carbon budgets, which theoretically aim for a less than 2° temperature rise, are based on greenhouse gas concentrations stabilising at 450 parts per million of CO₂ equivalent, but even that level in no way guarantees protection. The Inter- governmental Panel on Climate Change’s fourth assessment report makes it clear that if global CO₂ equivalent concentrations are stabilised about 450 parts per million, the risk of exceeding a 2° warming is about 50%. In other words, that is the equivalent of getting on a plane with only a 50:50 chance of it not falling out of the sky.

It is crucial that we make sure that our policy is based on the latest science. My speech is not the usual kind of intervention where we are scoring political points and focusing on short-term tactical questions. I believe and I hope that I am doing something more important than that. I am putting on the record the fact that we face a climate crisis of extraordinary urgency, and if we are to have any hope of tackling it, we need to be working on the basis of the right data. So I have three questions for the Minister to answer. First, will he agree to examine the latest science, and, as necessary, work to change the UK’s domestic targets to ensure that they continue to respect the political and public consensus to limit climate change to “acceptable” consequences? Secondly, will he ensure that the Government take the action needed to limit our emissions in time and in line with our global responsibilities to prevent climate change reaching dangerous levels—and that means including the emissions that are embedded in imports? Thirdly, will he fight on the international stage to do everything possible to ensure that all Governments take the same approach? If we continue to fiddle while not only Rome, but the whole planet burns, we will go down in whatever history can follow us as the species that spent all its time monitoring its own extinction, rather than taking active steps to avoid it. The Government say that there is no plan B on the economy. That is debatable, but the fact that there is no planet B is not.

--- Later in debate ---

[Norman Lamb (North Norfolk) (LD)]

I thank all hon. Members for their thoughtful and measured contributions, including that wonderful description of the Planning Inspectorate’s recent decision. Many hon. Members will have some sympathy with the views expressed there.

I must confess a personal interest. I am the son of a climatologist, so I spent many of my formative years learning about the natural cycles of climate, visiting sites such as medieval vineyards around Tewkesbury and so forth as friends were heading off to Torremolinos. Today, however, our focus is on man’s impact on climate and how we respond to it.

I shall deal first with the contribution from the hon. Member for Brighton, Pavilion (Caroline Lucas). The hon. Lady’s case is that the 2% target—limiting the increase of global average temperatures to 2% above pre-industrial levels—is not ambitious enough and has potentially devastating consequences. I share and the Government share her absolute concern about the need to take effective and decisive action to deal with what is an enormous challenge globally, and we do not dismiss it at all.

The target of less than 2%, however, is likely to be at the very edge of what is possible in terms of the technological and economic implications. It also involves radical lifestyle changes, and dealing with that globally and in democracies is often very difficult.

Achieving the 2% target globally will itself be immensely challenging. On the current trajectory, as the hon. Lady rightly said, we are looking at a 3.5° C to 4° C rise in temperature, the consequences of which certainly would be devastating, and if anything the gap is widening.

[Caroline Lucas]

The figure is 2° C, not 2%, but does the hon. Gentleman agree with me on the key point that runaway climate change would also require radical changes in lifestyle?

[Norman Lamb]

Absolutely, I do. I accept that completely, and that is why the Government are determined to take decisive action.

The consequences, however, of a 3.5° C to 4° C rise would be devastating, including a 2 metre rise in sea levels, a massive impact on food production and so on, but to hit the 2° C target we need global emissions to peak by 2020 and, after that, to reduce by 4% annually. That target is achievable if decisive action is taken by both the developed and the developing worlds, and this Government are determined to take a lead internationally —one of the things that the hon. Lady raised specifically —in seeking to achieve it.

Developing countries on their own are likely to account for 60% of emissions by 2020 owing to rapid development, and the Government recognise that the European Union must show leadership, so we are pressing for a 30% 2020 emissions reduction target, rather than the current 20%.

To answer the hon. Lady’s specific question about whether we need to review the target level, I note that the Cancun conference agreed to a review of the science to see whether to adjust the target and whether the 2° C target is adequate to prevent the disastrous consequences of climate change. I acknowledge what she said about the outcome of the recent Durban conference, but it did make progress on the design of that review and on the steps, including negotiating a new global agreement, to get the global community back on track to achieve at least the 2° C goal. I pay tribute to my right hon. Friend the Secretary of State for Energy and Climate Change for playing a key role in the Durban negotiations, which have taken things forward.

All that sets the context—the imperative of building a low-carbon economy—for dealing with the contributions from the hon. Members for Warrington South (David Mowat), for Daventry (Chris Heaton-Harris) and for Montgomeryshire (Glyn Davies). Not only do we need to reduce carbon emissions because of the imperative of tackling climate change, but we face the massive challenge of energy security.

I shall deal first with the hon. Member for Warrington South, who criticised the focus on renewables and sought to concentrate on the optimisation of decarbonisation, arguing for the importance of nuclear and gas in the short term. We face the immediate and remarkable challenge that nearly one third of our energy supplies will be going off-grid in the next decade. That is because of decisions already taken. Nuclear cannot deliver in that time frame. There are disadvantages in relying heavily on imported gas because it makes us more vulnerable to risks with regard to security of supply, fluctuating and volatile cost, and availability of supply. To replace the lost capacity and to hit challenging emissions targets, we need a new supply quickly, and wind and other renewables are a crucial part of that. Over the longer term, the Government have no intention of favouring one form of low-carbon energy production over another. Our intention is to secure a level playing field for low-carbon technologies competing with one another. Tidal power, which was mentioned by the hon. Member for Montgomeryshire, should be given its chance along with other technologies.

The Government have already issued a White Paper on electricity market reform. That is an important way to deliver the change that we need to secure proper competition between low-carbon technologies. It will mean that a level playing field is introduced by 2020, and it covers nuclear, carbon capture and storage, and renewables. The carbon plan published on 1 December, which sets out how we will meet the requirements of the fourth carbon budget—between 2022 and 2027—does not favour one form of production over another but offers different scenarios and different combinations within the whole mix. We are not looking to lock in any one form of production. The Government have stressed the importance of reducing energy demand and of improved energy conservation. That is why our green deal is so important, as is the radical step of introducing smart electricity and gas meters across every home. We do, however, stress the need for immediate and decisive action.

Autumn Statement

Caroline Lucas Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Osborne]

We have negotiated the first real freeze in the EU budget. Important negotiations are coming on the future financial perspective. I am absolutely clear, as are some other member states, that the EU has to live within its means as well.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Will the Chancellor explain why he is taking £250 million from hard-pressed families and giving it to some of the country’s biggest polluters, especially as green economies employ far more people than energy intensive industries?

[Mr Osborne]

As I said, we have introduced and funded the green investment bank, and we are supporting the green deal. The hon. Lady did not mention that there are £200 million of incentives to make the green deal work so that people can insulate their homes, their bills can come down and we can reduce our carbon emissions. I do not see how we would save the climate of our country and the world by pricing ourselves out of steel making, operating chemical factories, aluminium smelting and so on. If anything, it is likely that those industries would continue in other countries and be more polluting because those countries do not have the same regimes. I think that it supports our effort to reduce carbon emissions around the world that we keep those industries in Britain.

Summer Adjournment

Caroline Lucas Excerpts

Tuesday 19th July 2011 Commons Chamber

[Caroline Lucas (Brighton, Pavilion) (Green)]

One of my priorities as MP for Brighton, Pavilion is to tackle our city’s sad reputation as the drugs death capital of the UK. Since being elected, I have met many of those in my constituency who are most affected by drugs to explore ways of reducing the harms associated with drug use. Based on those meetings, I have two proposals for the Minister today. The first is that future drugs policy be based on evidence. The second is that responsibility for drugs policy be moved from the Home Office to the Department of Health, and I hope to demonstrate why such a move would be commensurate with an evidence-based approach.

Drug-related harms and the cost to society remain extraordinarily high in Britain despite decades of prohibition, yet successive British Governments have put their faith in the illegality of drugs being a deterrent in itself. Just last weekend, however, new research published in the Journal of Substance Use corroborated previous studies that suggested that whether a drug was illegal had very little bearing on people’s decision to use it. Why do we not look at the evidence?

In Portugal, the number of people taking heroin has halved since its use was decriminalised. In Switzerland, a series of new policies based on public health rather than on legality has led to a sharp decline in heroin demand and crime. A comparison between Norway, which has a very liberal regime but similar levels of drug use to Sweden, where strict controls are in place, shows very little correlation between levels of punishment and levels of drug taking.

In other words, there is a growing body of evidence to suggest that prohibition is not the most successful way to reduce drug-related harms, and that there are other approaches. As the chair of the UK Bar Council, Nicholas Green QC, has said:

“A growing body of comparative evidence suggests that decriminalising personal use can have positive consequences. It can free up huge amounts of police resources, reduce crime and recidivism and improve public health. All this can be achieved without any overall increase in drug usage.”

The Government, however, appear to be unwilling to countenance any approach other than prohibition. Their 2010 strategy makes a firm commitment to evidence-based policy making, yet in the very same document, the Home Secretary completely dismisses alternatives such as the decriminalisation of personal use.

There has never been an impact assessment of the Misuse of Drugs Act 1971; nor has there been a cost-benefit assessment, or any attempt to compare its effectiveness in reducing the societal, economic or health costs of drugs misuse with the alternatives. Yet we surely owe it to those affected to ensure that the overall policy framework—as well as spending decisions about particular treatments, for example—is informed by the evidence. Evidence-based prevention needs to be considered as well. If we want fewer young people to use drugs, we must craft messages that work, and we must do so in the context of the Equality Trust research that shows a clear and demonstrable correlation between high drug use and high levels of inequality.

The message I am hearing loud and clear from those I have met in my constituency is that rather than criminalising drug addiction we need to give people treatment and support. That view is echoed by Chief Superintendent Graham Bartlett of Brighton and Hove police, whose personal view is that

“the use of drugs is not well addressed through punitive measures.”

As he goes on to say,

“Providing people with treatment not only resolves their addiction—thereby minimising risk of overdose, drug related health issues, anti social behaviour and dependence on the state, for example—but cuts the costs to the community by reduced offending.”

That is why my second recommendation is that we decriminalise personal drug use and remove responsibility for drugs policy to the Department of Health. I am hosting a round table in Brighton in September to discuss how we might move forward as a city on this issue. It is clear that any changes need to be brought in slowly and carefully, but if the Government were to lend their support to such an approach, committing to a drugs policy that is evidence based and treatment led, I am confident that we could save lives locally.

Finance (No. 3) Bill

Caroline Lucas Excerpts

Tuesday 5th July 2011 Commons Chamber

[Caroline Lucas (Brighton, Pavilion) (Green)]

I am pleased to speak in support of amendment 12, because the House needs much more detail from the Government on the impact of a carbon floor price, including possible unintended consequences.

First, however, let me say a few words about amendment 21. Although I have a great deal of sympathy with some of the comments made about the amendment, we need to be reasonable when looking at the impacts of the sort of floor price we are talking about on energy-intensive industries. I am quite sure that some parts within those industries will face real problems, and it is right to look at measures such as border tax adjustment so that they are not put at a competitive disadvantage.

Let us not forget, however, that the EU has already exempted large numbers of energy-intensive industries from paying for the EU permits under the emissions trading scheme. Let us not forget that not all energy-intensive industries are subject to carbon leakage. Some undoubtedly are, and we certainly need elements of mitigation for them, but some can quite easily raise their prices and pass them on. Let us not forget that what we are trying to do is to put a price on carbon. That is the purpose of the whole exercise. Yes, we need to look at mitigating measures, where necessary, but let us not throw the baby out with the bathwater and lose the purpose of the exercise, which is to shift to a greener economy. Let us not forget that research by the university of Cambridge and others has found no empirical evidence to show that more ambitious climate policies will result in mass relocation of industries out of the EU.

[Ian Swales]

I respect the hon. Lady’s expertise on these issues. Can she give examples of energy-intensive industries that she feels are at no risk of carbon leakage?

[Caroline Lucas]

What I can say is that I have been in the European Parliament, that representatives of industries have told us time and again that the latest EU environmental law will lead to mass relocation from Europe, and that plenty of studies have shown that that has not happened. I accept that many energy-intensive companies will face problems that will need to be mitigated, but, according to those studies, the risk of relocation is far lower than has been suggested.

[Ian Swales]

rose—

[Caroline Lucas]

I will not give way again, because I want to talk about amendment 12, which I have tabled.

I agree that an effective carbon price mechanism has the potential to reduce greenhouse gas emissions from electricity power, mainly by increasing the carbon liability attached to energy use and thereby making energy efficiency measures and renewables more attractive. It also embodies the “polluter pays” principle, which, of course, I also support. I fear, however, that the proposed carbon floor price will not ensure that investment in energy generation is directed towards low-carbon technologies.

I hold that view for a number of reasons, including the fact that market-based solutions to direct investment in low-carbon generation have proved pretty weak in the past. For example, the EU emissions trading regime has so far failed to maintain the cost of pollution allowances at high enough levels to make any significant difference in reducing emissions. It is also true that, because the floor price will be subject to annual votes in Finance Bill debates such as this, it will fail to provide the price stability that is needed to boost certainty and security for investors in low-carbon energy sources. Furthermore, it can be difficult to judge the level at which a carbon floor price should be set to give appropriate incentives to the various technologies that the Government wish to support.

It is clear from those inherent weaknesses that a carbon floor price will maximise its potential to support a low-carbon economy only if any additional revenues that it raises are ring-fenced for use in support of that transition. That must include, in particular, energy efficiency measures for the fuel-poor. Many Members have raised that subject this evening. The Institute for Public Policy Research estimates that an additional 30,000 to 60,000 households could be pushed into fuel poverty in 2013 as a result of the carbon floor price because it will push up the cost of electricity.

It is therefore crucial for flanking measures to be introduced alongside a carbon floor price, including measures that will properly support and protect those in fuel poverty. They should include proper capitalisation of the green investment bank, support for the implementation of the green deal—for instance, ensuring that the “eco” element is increased considerably, given that it is the part directed at the fuel-poor—and, indeed, assisting in the development of innovative renewable energy technologies. Failure to ring-fence the revenue of the carbon floor price would mean missing a real opportunity to focus efforts on the technologies that will most quickly cut emissions from power generation.

Many other Members have reinforced the idea that the carbon floor price must not deliver windfall profits to the well-established nuclear industry, which has already been heavily publicly supported for many years. The Government’s own figures show that existing nuclear generators stand to gain £50 million a year from it until 2030. It is vital for the Government to clarify whether such a windfall constitutes the kind of subsidy for nuclear power that they have repeatedly said they will not provide. It looks very much like a subsidy to me, and it looks very much like a subsidy to the Chair of the Energy and Climate Change Committee, the hon. Member for South Suffolk (Mr Yeo), who has said that the Government should be upfront about the fact that it is a subsidy. He has also said that

“it would be deeply irresponsible to skew the whole process of electricity market reform simply to save face.”

I hope that Ministers will benefit from his expertise, and will recognise that rigging the electricity markets simply to try to provide more support for nuclear generation is entirely wrong.

[David Mowat]

The hon. Lady is making a powerful case against the nuclear industry, but a few moments ago she made a case against high electricity prices and their impact on the poorest in our society. Electricity costs in France are between a third and a quarter less than those in this country owing to decades of cheap nuclear power, which has a beneficial impact on both heavy industry and consumers.

[Caroline Lucas]

The hon. Gentleman will not be surprised to learn that I do not agree with the tenor of his intervention. The truth is that the price people pay for nuclear power does not represent its true cost in terms of liabilities, decommissioning and clearing up after an accident. People in Japan are not paying the true cost of clearing up after Fukushima. That £250 billion was not included in people’s energy costs. Nuclear subsidies are incredibly untransparent, but, essentially, people are paying a great deal more for nuclear power. I agree with the hon. Gentleman that we need electricity prices that people can afford, but the answer is to invest in renewable energy and energy efficiency, which will become far more competitive and far cheaper than nuclear power very soon if we give them the support they require.

If the Government recognise that this is a subsidy, they should claw it back through a windfall tax. I tabled a new clause that would have allowed them to do exactly that, but, sadly, it was not selected for debate.

[David Mowat]

It may be true that renewables will become more cost-effective over time, but there is an long way to go: a factor of about four in the case of solar power.

[Caroline Lucas]

I entirely disagree. I wish that the hon. Gentleman had been at a meeting with representatives of the solar industry that took place a few days ago in Portcullis House. We were shown presentations by Ernst and Young and others which demonstrated that if a small amount is invested now, solar energy will be able to compete with all fossil fuels and with nuclear power in four or five years.

Although an improved carbon floor price mechanism could help to deliver a less carbon-intensive energy sector, it is important for the Government not to see it as a “silver bullet” solution. Other stronger levers, such as a well managed—I underline “well managed”—feed-in tariff regime and a strong emissions performance standard must also be part of the overall picture. Sadly, however, the Government are falling short in those respects as well. I should like them to devote at least as much effort to stepping up their work at EU level to ensure that the next phase of the EU emissions trading scheme is much more effective than the current phase. The recent collapse in the cost of EU carbon allowances under the scheme is clear evidence of their over-allocation, and the shortcomings of the scheme are becoming increasingly obvious.

I should also like the Government to work with European partners to ensure that, as a minimum, allowances are in line with the policy of cutting EU emissions by between 80% and 95% by 2050, as agreed by member states; that allowances cannot be banked from the second phase of the EU ETS into the third phase; and that a reserve price is set on the auction of permits into the market. Any permits that the market does not want to buy at the reserve price or more should be retired from the scheme.

I urge the Government to undertake to produce the report for which the amendment calls, and to take the opportunity to show how the benefits of a carbon floor price can be maximised and any unintended consequences eliminated. If the carbon floor price is to be effective, we need a tax on the windfall profits of the nuclear industry, along with flanking measures to ensure that those in fuel poverty do not suffer as a result of this policy.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

The Economic Secretary to the Treasury has already suggested that those in favour of a carbon floor price should explain how it could be introduced in a different way from that proposed by the Government. I imagine that she will return to that subject at the end of the debate, but I suggest that she need only look at her own consultation document, which led to the amount that has been established and the mechanism by which the floor price works.

The consultation document posited a £1 difference between a Europe emissions trading scheme and a carbon floor price, certainly in respect of the starting period. It also warned about how far away from that £1 difference a floor price might go and what might happen to energy prices in the rest of Europe. As people who contributed to that consultation document suggested, because our energy supply is highly interconnected with that of Europe, a substantial difference could lead to investment going to where the sale price is cheaper, with, perhaps, new gas-fired power stations being developed on the other end of an interconnector rather than lower-carbon power stations being developed at our end of an interconnector.

--- Later in debate ---

[Justine Greening]

My hon. Friend makes a helpful contribution. I am always happy to meet hon. Members. In fact, only last week I wrote back to the hon. Member for Stoke-on-Trent Central (Tristram Hunt) to say that I would be happy to meet representatives of his local industry. One of the reasons we are working across Government—not just the Treasury, but BIS and DECC—is to make sure that we consider all the different aspects of the support we want for the energy-intensive industries, and get it right.

I am conscious of the time, and the fact that Members want to debate the remaining amendments, so I now want to make progress. In Committee we discussed at length the issues raised in the amendments. Not all Members present in the Chamber today will have heard those debates, so I shall go through my response to both amendments, taking amendment 21 first, as it raises some important points. It would require the Government to lay, and Parliament to approve, an agreed package of mitigation measures for energy-intensive industries.

A number of Members from across the House made powerful cases on behalf of their local industry about why the issues are so important. The Government recognise the issues and want to take steps to address them. There is, as I said, clearly a balance to be struck: we need to meet our carbon reduction requirements, but to do so in a way that still enables the UK to continue to have competitive energy-intensive industries. That is why the Budget helped to offset the impacts of the price floor on energy-intensive industry and to show, as we have heard, that the UK is open for business, as it must be.

In March we announced an extension of climate change agreements to 2023, with an increase in the discount on electricity from 65% to 80% for participants in the scheme from April 2013. We plan to consult on how to simplify climate change agreements for the companies participating in them. Overall we intend to reduce tax levels to among the lowest in the EU.

We announced that we would not introduce the previous Government’s planned complex and costly carbon capture and storage levy, which would have increased electricity bills by 2% from 2015. In addition, we set out plans that will see a cap on the cost of policies funded through energy bills. To support industry more broadly, we introduced policies that will reduce corporation tax by a further 1%, which is part of an overall year-on-year set of reductions in corporation tax.

As I said, BIS, DECC and the Treasury are already in discussion with energy-intensive industries to identify those most affected by the carbon price floor and to pull together the best set of options to address some of those concerns. The package that we plan to announce by the end of the year will build on the measures, some of which I have set out, that we announced in the Budget. The Bill could also be a means of implementing part of the package. I should be clear that the options that we are considering do not relate only to tax. They look across the board at what we can do to support energy-intensive industries.

On Opposition amendment 12, the carbon price floor is designed to give UK electricity generators certainty about the carbon price. That will encourage more investment in low carbon. Although some Members expressed concerns about how the policy will work, it has been supported by a number of members of the investment community. A range of policy assessments have been carried out not just as part of the consultation document, but as part of the extensive impact assessment that was done alongside that, including the tax impact and information note that was published at the time of the Budget.

[Caroline Lucas]

Does the Minister agree that the carbon price floor effectively constitutes a subsidy for nuclear power? Does she therefore agree that unless it is clawed back through a windfall tax, it would contravene the terms of the coalition agreement on no subsidies for new nuclear?

[Justine Greening]

I am pleased that the hon. Lady has raised that point, because it gives me the opportunity to be crystal clear again—alongside the statements that I made in Committee, and those that she knows I have made to the Select Committee of which she is a member—that this policy is not a subsidy for the nuclear industry. As was pointed out in the previous debate by my hon. Friend the Member for Bristol West (Stephen Williams), who I am pleased to see in his place following his contribution to the Committee stage, this is a tax on carbon, not on nuclear fuel rods, as happened in Germany.

The reason nuclear is outside the scope of the tax is that uranium and wind, for example, are not in the carbon price floor because, of course, they do not contain carbon. I understand the arguments that have been made, but they are a little like saying that because we have a tax on alcohol, that is a subsidy for the soft drinks industry. There is also a contradiction between what Opposition Members have been saying. They complain that this is a tax-raising measure, yet they also say that it is a subsidy. Those arguments are contradictory.

Amendments 21 and 12 are unnecessary, and I hope that they will both be withdrawn.

Question put, That the amendment be made.

Oral Answers to Questions

Caroline Lucas Excerpts

Tuesday 21st June 2011 Commons Chamber

[Mr George Osborne]

My hon. Friend is right: it is a decision of great regret. The gold was sold at £2.3 billion, and it would now be worth £12 billion, which as he says is a £10 billion loss. The Labour party, on the advice of the shadow Chancellor, managed to sell gold at its record low price. Indeed, gold traders now call it the Brown bottom. That is how they know the number, and it is yet another disastrous decision after which we are having to clean up.

[Caroline Lucas (Brighton, Pavilion) (Green)]

The Chancellor will be aware of the recent Office for National Statistics finding that the regressive nature of VAT means that the UK tax system is doing almost nothing to prevent income inequality. In that context, will he pay particular attention to a Fawcett Society report, to be launched tomorrow, which shows that his fiscal policies, such as increasing VAT, cause particular harm to lone parents, 92% of whom are women?

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

May I also point out that our tax policies include taking hundreds of thousands of people out of income tax altogether? On the particular subject that the hon. Lady raises, of those taken out of income tax following the announcement in the Budget earlier this year, 56% will be women.

Solar Power and Feed-in Tariffs

Caroline Lucas Excerpts

Tuesday 29th March 2011 Westminster Hall

[Alex Cunningham]

I am going to move on, because I need to get through my speech.

Even if we accept that such large-scale sites are a potential concern, why can the Government not restrict the use of greenfield sites and set a reasonable kilowatt capacity limit to curb industrial-scale developments, as suggested by my hon. Friend the Member for Ogmore (Huw Irranca-Davies)?At a time when oil prices are rising and volatile, and when the nuclear crisis in Japan is highlighting to all the dangers of nuclear power, I am not alone in suggesting that the Government should look at ensuring that popular, green methods of meeting our energy needs get the support that they deserve. Medium and large-scale solar PV schemes can be part of the solution to serious energy security and climate change problems, but the Government seem intent on focusing just on domestic-scale installations.

The REA tells me that the Department has underestimated solar’s potential and overestimated its cost. Disappointingly, I do not have time to go into the detail, but this technology has exceptional and proven potential. I am told that in Germany—a country with a climate similar to ours—solar PV could reach grid parity, where no subsidies would be required, between 2013 and 2016, which is just two to five years away. Where will the UK be? Yes, left behind again.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Does the hon. Gentleman agree that Ministers’ suggestion that slashing support for the solar industry does not matter because it affects only projects larger than two tennis courts really is ridiculous, given that an average secondary school could accommodate about 80 kW, which is considerably more than the 50 kW produced in an area the size of two tennis courts, which Ministers like to cite?

[Alex Cunningham]

Indeed. The hon. Lady arrived late, and that was the very example I used when I opened my speech.

The fact is that we face a predicted energy gap in 2017, with power cuts anticipated for the first time since the 1970s. I am told that DECC had a taste of things to come last Thursday, when it was subjected to its own power cut, which meant that officials were unable to print important briefing notes for Ministers ahead of DECC questions on the Floor of the House. Perhaps that is why the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker), was so badly prepared for questions that day and used the rather shabby comparison with Germany’s tariff scheme when seeking to defend the changes his Department has announced. He said:

“Community-based projects that are larger than 50 kW…and up to 150 kW…will still get a tariff comparable to that paid in Germany.”—[Official Report, 24 March 2011; Vol. 525, c. 1068.]

Fuel Prices and the Cost of Living

Caroline Lucas Excerpts

Wednesday 16th March 2011 Commons Chamber

[Ms Eagle]

I am pleased that the competition authorities have launched an investigation into what has been going on with heating oil. My hon. Friend is right to point out that transport in rural areas is a particular issue.

People who are already financially stretched by this Government’s slash-and-burn approach now find themselves trying to cope with sudden sharp increases in the price of essentials such as food, energy and fuel. Recent OECD figures put UK food inflation at 6.3%. That is higher than the consumer prices index, higher than the retail prices index, and higher than in most of the rest of Europe. In my constituency, parents are now worried about the rising cost of providing balanced meals for their children.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Does the hon. Lady agree that the fuel duty escalator is an important tool to send a clear message that oil prices are going to have to continue to rise, not only for geopolitical reasons but because of peak oil and climate change, and that a way of ensuring that the poorest are not hardest hit would be to scrap the recent VAT increase in totality and replace it with a crackdown on things such as tax evasion and tax avoidance?

[Ms Eagle]

The hon. Lady is right that there has to be a balance between the environmental aspects of taxes on fuel and living standards. However, I find, all too often, that on the green side of the argument the social justice aspects of imposing environmental tax rises are not thought about enough, and such measures tend to hit hardest people whom we are least able to help. She needs to help all of us, when we are thinking about this, by bearing in mind the effects on poverty of environmental taxes.

--- Later in debate ---

[Justine Greening]

I am sure the hon. Gentleman was quite happy trotting through the Aye Lobby when his party brought forward its 12 fuel duty rises and the Budget in which it announced a further six. His question is particularly disingenuous because at that time the Conservative party was campaigning against unreasonable and unfair rises in such things as road tax. The Labour party paid no attention and continued to hammer motorists again and again.

[Caroline Lucas]

rose—

[Justine Greening]

Perhaps I will make a bit of progress, because I know that many Members want to take part in the debate.

--- Later in debate ---

[Justine Greening]

I shall make a bit more progress, because I want to talk about the Labour party’s so-called fuel duty proposals, which are of course VAT proposals.

We are increasing child tax credits above the rate of inflation, giving lower-earning families an extra £210 over the next two years. Of course, poorer families will still receive more in child credits than they received under the previous Government, and, as I said, lower earners will be better off as a result of this Government’s changes to the personal allowance.

[Caroline Lucas]

Will the Minister explain how it is compatible for a Government who claim to be the greenest ever to duck this opportunity to introduce a shift to green taxation—in other words, to keep the fuel duty escalator but to reduce other taxes accordingly?

[Justine Greening]

The hon. Lady’s point is about how to strike the balance between achieving environmental change and managing to raise revenues for the Exchequer to fund public services, which I am sure she agrees need the right level of funding. I think we have got the balance right in our approach to fuel duty and VAT on fuel. The challenge is that if we do not go ahead with the previous Government’s increases, we could fundamentally damage our ability to tackle the deficit. This Government are constrained purely because of the terrible financial situation that the previous Labour Government handed over to us.

Comprehensive Spending Review

Caroline Lucas Excerpts

Thursday 28th October 2010 Commons Chamber

[Danny Alexander]

I am going to press on with this section of my speech, and then I will give way in a moment.

In June’s emergency Budget, we set out the road map to recovery and took the country out of the danger zone. The independent Office for Budget Responsibility examined our plans in June and forecast the economy growing and unemployment falling in every year. It also assessed that we were on course to eliminate the structural current deficit and see debt fall by the end of this Parliament, one year ahead of our mandate. The recovery will be choppy, but we are confident that our plan will see us through.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Does the Chief Secretary accept that he is introducing a benefit system based on punishment? Does he agree that anyone out of work for more than a year will now lose 10% of their housing benefit? That is punishment. What advice would he give to my constituent in Brighton who has gone for 465 jobs over the past 10 months without success?

Comprehensive Spending Review

Caroline Lucas Excerpts

Wednesday 20th October 2010 Commons Chamber

[Mr Osborne]

I agree with my hon. Friend. Whoever won the general election—whoever formed the Government—was going to have to come to the House of Commons to set out a plan for reducing the highest budget deficit in our peacetime history; the deficit is considerably higher than it was when Denis Healey had to go to the International Monetary Fund. We have set out those proposals, and I believe that they will deliver certainty and stability going forward. The market interest rates for British businesses and British families are already lower as a result of the decisions that we have taken since coming into office. As for the decisions that we have announced today, I have noted that not a single Labour Member has asked me about the increase in the child tax credit, which will help 4 million families.

[Caroline Lucas (Brighton, Pavilion) (Green)]

I am not sure how the Government can claim to be the greenest ever when it is estimated that Department of Energy and Climate Change and Department for Environment, Food and Rural Affairs funding combined will reduce by 47% in real terms over the next four years. However, my question is this: should the Chancellor not do more than just hope that the private sector will fill the huge gap between the £1 billion he has set aside for the green investment bank and the £4 billion to £6 billion that Ernst and Young says is the minimum required? He said that he would try to find a bit more through the sale of assets, but how much does he imagine that will fund as well?

[Mr Osborne]

There is commitment, even in these difficult times, to a carbon capture and storage demonstration, to the development of offshore wind technology and manufacturing at port sites, and to a renewable heat incentive. On the green investment bank, it would have been easy to say, in my position, “Let’s wait to see whether we can get some Government asset sales and some private sector money; just create the body and hope it gets the funding.” I wanted to provide a back-stop and I have done so today by making available £1 billion from general Government expenditure. However, I also want to see substantial Government asset sales go into the green investment bank and to lever in some private sector money, so that it is a multi-billion pound force for investment in our country.