Jobs and Growth in a Low-carbon Economy

Luciana Berger Excerpts

Monday 5th March 2012 Commons Chamber

[Mr Davey]

The problem with some of the Opposition’s criticism is that they do not seem to realise that this will be a market-based system, and that the Government will not set the interest rate. The right hon. Gentleman needs to understand that green finance companies such as those I have just been talking about will set the interest rate.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

The Secretary of State has said that the Government will not intervene in that way. Is he aware of the German example, in which the German Government have taken the lead and subsidised the interest rate down to 2.65% for a similar green deal scheme? The uptake for that scheme is 100,000 homes a year. This Government’s ambition is for our scheme to be massively larger than the German one, and we want to see that ambition realised, but how does the Secretary of State expect to achieve that when the interest rate has not yet been set? There are indications that it will be set at 6% or above, but polling shows that that would result in only 7% of the British public being interested in the scheme.

[Mr Davey]

I am afraid that the hon. Lady is slightly confused. The German scheme is a personal loan scheme. Our green deal scheme is attached to utility bills; it could not be more different. The structures that she is talking about would therefore not work in the scheme that we are introducing.

The Labour Government were, frankly, equivocal about the capacity and suitability of our energy infrastructure. The coalition is therefore having to work doubly hard to compensate for the missed years. Our reform, set out in our White Paper last year, will secure our energy supplies, guarantee returns for investors and safeguard consumers from volatile internationally-set fuel prices. Critically, it will deliver energy infrastructure that will ensure Britain can evolve into a competitive low-carbon economy. We are introducing a mechanism to ensure that there is sufficient capacity, too.