Lord Stunell
Main Page: Lord Stunell (Liberal Democrat - Life peer)
Baroness Andrews (Lab)
My Lords, it is a pleasure to follow the noble Lord, Lord Krebs, who speaks with authority on climate change. I support the amendment in the name of my friend, the noble Baroness, Lady Parminter. We were both members of the Select Committee on the built environment, and we heard a weight of evidence that supports the amendment.
In July 2015, when the Government announced that they were scrapping a proposed regulation to require all new homes to be carbon neutral, they justified their action on the grounds that they sought to continue to reduce the overall burden on housebuilders. That has always been the argument used, and it is where the debate takes a wider turn. Reducing the burden on private sector housebuilders has also been the justification: for the mantra of deregulation that led, in March 2015, to the Government removing the code for sustainable homes; for the failure to implement national standards for lifetime homes; and for a complete failure to plan for the future and the mitigation of climate change, and to plan for longevity—the two most transformational impacts on our society.
The pursuit of deregulation at the expense of foresight and, frankly, simple common sense marks a certain opportunism in the Government that is, basically, dangerous. As we have heard already, there is no evidence from the industry to suggest that deregulation in this form leads to faster or better building, or to lower profits. In fact, intelligent builders, large and small—we heard about the London example—find that there is a market for sustainable homes that reflects the starting price and is reflected in lower bills. There is a driver for improvement that we should recognise in policy.
The Government’s Foresight unit warned a year or two ago, with total conviction:
“The potential role of land and land use in both climate change mitigation and adaptation will be profound. The move to a low-carbon economy will increasingly influence land use decisions, settlement patterns, the design of urban environments, and choices on transport infrastructure”.
That is the reality, but I fear we have a Government who reject the obligation to think ahead, who ignore the evidence, and who seem to be in denial of the reality of the significant emissions, as we have heard—I think 25% of our emissions come from the built environment—and of a potential increase in our population of 9.7 million homes over the next 25 years, with all the imperatives that creates for sustainable housing and infrastructure.
Taking just the code for sustainable homes, elements of it are now incorporated into building regulations and defined as new national technical standards. They are designed to reduce burdens, but in evidence to the Select Committee, Worcestershire County Council—hardly a pusher for a socialist agenda—said:
“Withdrawing the Code for Sustainable Homes appears to have sent a signal to developers that sustainability measures are less important than before, meaning that councils wishing to promote better environmental performance in new development will struggle to deliver higher standards.”
The UK Green Building Council put it equally bluntly:
“In the last 10 years we have had this very clear trajectory and everyone has known where they are going and have had a lot of time to put in place the strategies. Now we do not know where we are going”.
The Select Committee’s judgment has already been quoted. It was absolutely certain that the decisions would add to long-term costs and that there was no evidence that they would have any impact on the Government’s stated primary objectives to speed up housebuilding. It also said that it did not have,
“a clear explanation as to how new homes will be energy efficient and environmentally sustainable”.
I urge the Government to reverse their decision on this extremely important matter. This is the opportunity for the Minister, who has listened so closely throughout the debate, to show foresight and, frankly, common sense, and accept the amendment.
Lord Stunell (LD)
My Lords, I support the amendment proposed by my noble friend, which has been supported also by the noble Lord, Lord Krebs, and my Labour colleague. There is absolutely no inconsistency with Conservative policy, or the Conservative Government’s policy, in supporting this amendment. I remind the Minister that although the genesis of this measure lay with the preceding outgoing Labour Government, it was strongly supported by both parties in the coalition agreement. Indeed, last year the Prime Minister said at the conclusion of COP 21:
“The talks at the COP21 conference in Paris have culminated in a global deal, with the whole world now signed up to play its part in halting climate change. In other words, this generation has taken vital steps to ensure that our children and grandchildren will see that we did our duty in securing the future of our planet”.
Therefore, I say to noble Lords on all sides of the House that this is absolutely a mainstream and necessary policy move to take. Of all the things that can be done to improve the UK’s performance on reducing climate change and the impact of CO2 emissions, tackling the built environment is right at the top of the list. Buildings account for 34% of our carbon emissions and within that homes account for two-thirds—that is, 22% of carbon emissions—significantly more than the whole of the transport sector. Governments devote many brain cells trying to find ways of reducing vehicle emissions and CO2 emissions but contribute nothing like the same level of policy input or intensity to reducing the much bigger output of carbon dioxide emitted from homes.
That brings me to the reasons given by the Minister when we discussed this in Committee. I do not want to rehearse all the arguments deployed then, but one which came across very strongly was that the Government were placing a lot of reliance on the additional cost that this measure would impose on the construction of an average house. Connected to that was their understanding that if there was such an additional cost, it would automatically lead to a reduction in the volume of homes that would be built. As my noble friend said, at the time the Minister relied on a Zero Carbon Hub estimate that the extra cost would be £2,885 per home. Unfortunately, the Minister did not complete the quotation from the Zero Carbon Hub report, which said that the cost would fall very substantially over subsequent time. The noble Lord, Lord Krebs, mentioned a range of values. It is highly likely that at this stage, two years after that estimate was made, the likely cost, given existing technology and building experience, would be about half that figure—perhaps, say, £1,500. If the cost was £1,500, the annual saving mentioned by the Minister in Committee would be repaid in five years. In other words, the additional cost would be repaid in five years given the reduced energy costs for the inhabitants of those homes. Given that the typical house built today will still be standing and occupied in 60 years, I would have thought a payback period of five years suggests that there is not too much of a problem on that score.
A second leg of that argument was that the increased cost of construction would result in fewer homes being built. I have put some questions to the Minister which I hope she will be able to answer when she responds to this debate. I thank her for the very constructive meeting with her that she arranged for a number of us who support this amendment. The reality is that building costs go up each year in any case for lots of reasons, such as shortage of labour, increased pay rates, shortage of materials and higher costs. For instance, the average cost of building a three-bedroom home in Hertfordshire has been slightly higher in each of the last five years. It has been increasing. I hope the Minister will be able to give us those figures later on. It is even more true that the cost of the land on which that home is built has been increasing as well, by a very much larger amount. I hope the Minister will be able to tell us what that increase is.
It ought to follow, from the theory deployed in Committee by the Government Front Bench, that as those costs rise the number of homes should fall and, presumably, so would their price. It is interesting that the sale price of a typical three-bedroom house in Hertfordshire has been rising faster than any increase in construction costs. It is also the case that this has not led to a reduction in the volume of housebuilding. It seems that neither leg of the argument stands up in regard to the link between the cost of providing high quality and the impact on volume or quantity. I hope the Minister will provide the House with some additional information on that and, perhaps, tell noble Lords which leg of the argument the Government will now use to advance the view that this amendment should be rejected.
It has also been said, and was mentioned in Committee, that the Federation of Master Builders is against this proposal and is very important. I do not think anybody in this House would deny its importance, but its members are responsible for only some 20% of the new homes built each year. As has been reported, the overwhelming concerns of builders large and small are access to finance and land and shortage of labour. Right down at the bottom, at only 4%, are concerns relating to regulation and red tape. I do not know what other arguments the Minister may rely on. There is certainly a need for more consultation, but all the consultation on this proposal has already been carried out and the Government had already reached the conclusion that it was appropriate to go ahead. Any consultation which may still be necessary will easily fit into the 12-month period allowed for in this proposed new clause.
I guess that the final argument will be that such a provision should not be so precisely and explicitly stated in the Bill: it ought to be in regulations. The Government have brought this upon themselves. The regulations already exist; they have been printed and published. However, the Government have announced that the next triennial uplift in building regulations has been cancelled. They could reinstate it and give an undertaking to proceed with the stalled regulations. They have not done so and that means that the only way forward, the only way to demonstrate that Britain is sincere in its signature on COP 21 and the only way of helping the Prime Minister to demonstrate that this Government, like the preceding one, intend to be the greenest ever is for this clause to receive the support of your Lordships today.
Lord Kennedy of Southwark (Lab)
My Lords, I refer to my declaration of interests. I am an elected councillor in the London Borough of Lewisham. Although the government amendments which we will be looking at later on today may, in some cases, be responding to points raised by noble Lords in Committee and on Report, the fact that they are there highlights how unprepared the Bill was when it arrived in your Lordships’ House. The Government should reflect on that when bringing legislation to this House in future. Even when we do not like legislation, we at least expect it to be fit for purpose. That has not been the case here and I hope we see no legislation in that state in the next Session of Parliament.
Amendment 118, in the name of the noble Baroness, Lady Parminter, has the full support of these Benches and if she wishes to test the opinion of the House today we will support her. The issues raised in the amendment were debated in Committee, as we have heard.
We all agree there is a housing crisis, but any attempt by the Government to deal with it must ensure that homes are built to a high-quality standard and meet the challenges that we are all aware of rather than ignore or fail to address them. The zero-carbon homes standard is important to deliver on our climate change commitments, and the cost of building to standards that will achieve this and provide homes that will drive down energy bills and reduce carbon emissions could now be much less than the £3,500 we heard about in Committee; we have heard today that it could be as low as £1,500. The cost is initially borne by the homeowner but over the long term it will reduce fuel bills and getting it right in the first place will be much cheaper than having retrofit measures at a later date. This is good and we support it.