Tuesday 4 February 2020
[Caroline Nokes in the Chair]
Net Zero Targets and Decarbonising Transport
I beg to move,
That this House has considered net zero targets and decarbonising transport.
It is a genuine pleasure to see you in the Chair, Ms Nokes, and to have an opportunity to serve under your chairmanship. Tackling climate change is the defining challenge of our age. In the developed world—the rich world, with our higher per capita emissions—our responsibility is all the greater. I was proud last year when the UK became the first advanced economy to set in legislation a date for net zero, and I am pleased today that we are taking a further practical step by bringing forward the phase-out of petrol and diesel vehicles to 2035.
The UK has been decarbonising more quickly than any other G20 country, although one would not know that from hearing most commentary in this country. One would think that it is because of some accounting methodology, the cunning exclusion of some categories, or the financial crash of 2007-08. One would think that it all happened before 2010 and that nothing has improved since, or that it was because we have exported all our emissions to somewhere else in the world. But no, this country has made good and sustained progress on decarbonisation under Governments of both types. The greatest part of that progress has been made on energy decarbonisation, and the reality is that there is a limit on how much further we can go in that area with current technology, because of the intermittent nature of the sources—the sun and the wind. It will change as battery technology improves, but that is the situation today. We have made good progress, but it is not enough. To hit our net zero 2050 target, we need to increase the decrease, as it were, in our rate of emissions by about 30% compared with what we have managed per annum since 1990. Partly because of the success in energy, transport is now the biggest single source of emissions.
There are many different aspects of decarbonising transport, and we have only 90 minutes for this debate. Other colleagues might talk about active travel, such as walking and cycling, or about shipping, on-demand buses, the electrification of rail, heavy goods vehicles, the development of autonomous vehicles, alternative jet fuel technology or what could be the huge potential, eventually, of hydrogen—and it would be a turn-up for the books if nobody mentioned either HS2 or Heathrow airport. We could talk about many different aspects, but I will concentrate on roads, which is the biggest category, and specifically cars.
I congratulate the right hon. Member on securing the debate, and I agree with him on road transport. Will he join me in urging the Minister to let us know as quickly as possible about the funding available in Greater Manchester for the clean freight and clean bus funds? We have good transport and clean air strategies, which were launched by the Mayor of Greater Manchester, but we need money to help small businesses and our bus network to become green.
I know the hon. Lady’s part of the world well, having stood for Parliament there in the mid-2000s. Buses are an important part of the overall mix, and for Greater Manchester, although I will let the Minister deal with her point in his own way.
On electric vehicles, there is a wide range of Government support and good cross-industry co-operation. There is a subsidy programme for vehicles, home charging points and workplace charging, and there are grants to local authorities for a number of different purposes.
Electric vehicles need electrical steel, and the only electrical steel maker in the UK—the Orb works in Newport, which was owned by Tata—was mothballed just before Christmas. Does the right hon. Member agree that supporting our steel industry at this crucial time will be vital for an end-to-end supply chain in this country?
Steel is of great importance, and the hon. Lady knows better than most people how important it is to our industrial base. It is also important to the development of many green technologies. As she knows, steel has its own challenges. It is a very energy-intensive sector; in time, hydrogen technologies and others might help in that regard, and we need to ensure that we maximise our efforts towards them.
We now have over 22,000 public charging points for electric vehicles. There is a particular concentration in London, but also in places such as Dundee. We have 125 rapid charge points per 100 km of highway, compared with the EU average of 25. In 2018, the UK was the second-largest market in Europe for ultra low emission cars and the fourth-largest market for electric cars, and one fifth of battery electric cars sold in Europe had been made here in the UK. For actual sales as a percentage of the total car market, we were above France and Germany but, as colleagues will know, we were below some of the very high-percentage countries, particularly the Scandinavian nations and others such as the Netherlands. It is the growth curve—the year-on-year growth, albeit from a small base—that is particularly encouraging.
Alongside changes in electric vehicle technology, a lot of other relevant changes are happening in society and the economy. We have been changing the way we shop, and how and where we work, and those things potentially have material implications for the number, type and length of people’s journeys. The product itself—the performance of cars—has been improving. At the same time, the charging technology has been evolving with things such as induction pads. We have the development of autonomous vehicle technology, which is likely to be particularly significant in the future for heavy goods vehicles.
I suggest that the most important change of all is one that has already started: a change in how we buy our own transportation. “Mobility as a service” includes everything from Boris bikes to car clubs. In the car market, it includes the growth of personal contract purchase plans and, significantly, personal contract hire plans. Why do I say that is so significant? Is it not just a way of financing a vehicle? It is significant because it changes the way that people think about the cost of a vehicle. Historically, people would compare the sticker price of a car separately from the monthly running cost, but with different types of paying for mobility, the formula has changed significantly.
I thank the right hon. Member for securing the debate, and he is making some important points. He says we need to change the way we do things. Does he agree that we need a modal shift away from cars and towards less carbon-emitting transport? Buses are key, and we need to shift bus pricing to invest in that sort of transport. If two or three people are travelling together in Sheffield, it is cheaper for them to get a taxi than to go on a bus. Does he agree that we have to change that by investing properly in our bus services?
As ever, the hon. Member makes an important and incisive point. A modal shift is clearly part of the response to this issue, but it will not be the whole response. As I mentioned earlier, buses are an important factor too, but there will always be a need for domestic passenger transport—cars, as we tend to call them. In a constituency such as mine, which is very rural and spread out, people need cars if they want to go to work. Making cars as environmentally friendly as possible, in terms of both carbon emissions and air quality, is an important goal.
It feels as though we are on the cusp of some quite significant change or what might be called a watershed moment. With the conversion to electric vehicles, however, we are up against some quite significant challenges from a consumer perspective. The first is cost. There is a gap between the cost of electric vehicles and the cost of internal combustion engine vehicles. Although that gap is narrowing all the time, however, I do not think that, in general, the sector or the public sector has yet made the clear and compelling case for how close those costs are—looking not at the purchase price, but at the total cost of ownership over the car’s lifetime—as well as it could have been made.
The second challenge is so-called range anxiety—“What happens if I leave home and can’t get back again because the battery runs out?” That is a perfectly good, rational fear, part of which will be addressed by improvements in infrastructure. As an aside, although scientists would say that there is no benefit to having a spare battery, and that we should just make a bigger battery, I wonder what the psychological effect might be of having one.
The third perfectly rational worry is about the car’s residual value, particularly as a result of battery degradation. That is particularly rational, given what we have been told over the years about mobile phone and laptop batteries— we have been told, “This is the generation that will not lose any of its performance,” and it has never turned out to be true. Again, if the car is not owned in the same way, that worry should be somewhat dissipated.
The right hon. Gentleman is making valid points about the roll-out of electric vehicles, but in Norway sales of electric vehicles is hitting 60%, which shows that it can be done and the anxieties can be overcome. Is it not a matter of looking at what Norway is doing and how its Government have incentivised electric vehicles and helped consumers get over any such anxieties?
That is perfectly worthwhile and reasonable. In preparation for this debate, I looked at countries such as Norway and other Scandinavian countries. It is usually instructive to start with the more comparable countries—those of a similar size and complexity, with a similar industrial base, traditions and so on—but the hon. Gentleman is quite right to identify that Norway in particular has a high penetration rate of sales, which is also linked to very high differences in the taxation regime.
I want to talk briefly about the shift to electric vehicle technology and what I would say is overwhelmingly a consumer acceptance challenge. The shift in the way people own cars, towards personal contract hire, is a great opportunity to convey how the whole-life cost compares for different groups of consumers, rather than comparing the sticker price of one car against another. It is also a way of allaying fears about residual value and battery performance. Allied to that, when it comes to cost, it would be helpful—I realise this is not in the Minister’s gift—for the Treasury to give a clear forward view on the vehicle excise duty regime so that people can project into the future.
Clearly, these technologies eventually have to be subsidy-free. It has to be business as usual, so subsidies will have to be withdrawn, but doing so smoothly will be of great benefit to the industry and the consumer. The experience from elsewhere shows that if subsidies are suddenly withdrawn, there tends to be a massive spike in demand just beforehand, followed by a return. That is obviously not good for meeting production schedules.
On the infrastructure network, there is a lot that the Government can do through a mixture of regulation and their convening power. We need to do better and go further on full roaming and interoperability. We can do a lot better on the visibility of charging points. There has been a lot of focus on visibility to users of electric cars, but I am actually less worried about them right now than everybody else. The point is that to get consumer acceptance, non-users of electric cars need to know that there are plenty of places to charge them.
The right hon. Gentleman is making a very important point. It is especially important in rural areas, such as those that he and I represent, that people who have not looked at electric vehicles in the past know that it is feasible for them to make that shift.
That is absolutely right, and showing it on sat-nav tech is important. There are some good sat-nav applications, such as Zap-Map, but it is difficult to guarantee that such things are absolutely comprehensive. There is some old-fashioned technology that could be improved, such as common signage. National brand partnerships mean that people know that whenever they go to any branch of supermarket X, if it has a car park, they will always find a minimum of x number of charging points.
My right hon. Friend is making a powerful speech about the importance of electric cars and how we meet our net-zero targets. Does he agree that we cannot escape the fact that electric vehicles are themselves pregnant with carbon? A huge amount of carbon goes into manufacturing them. One of the best and most effective ways to meet our net-zero target its not to use vehicles at all, and to ride bikes as much as possible, particularly in urban areas such as Cheltenham. Just 2% of our journeys are on bikes; in the Netherlands, it is closer to 35%.
My hon. Friend is not only an advocate for walking and cycling but, in his high-vis jacket, a very visible advertisement for it. He is absolutely right, and that is another type of modal shift. Holland is in a slightly different position, in that it is a lot flatter than this country, which makes a huge difference. That should not take away from the fact that there are plenty of places in this country—London is one of them—that are pretty flat, and where there could be more cycling. Throughout our country, there is an opportunity for more walking and cycling. Those things have great benefits beyond decarbonisation, in terms of health, fitness and being outdoors.
To echo the point made so well by the hon. Member for Cheltenham (Alex Chalk), something like 80% of journeys are less than 2.5 miles. Therefore, if we can make a modal shift, so that that type of journey is made by bike, on foot or by public transport, we will make a huge difference.
I will let that point hang in mid-air because, like the points made by my hon. Friend the Member for Cheltenham (Alex Chalk) and the hon. Member for Ceredigion (Ben Lake), it is spot on. Those things are all part of the mix.
On electric vehicles and the infrastructure network, there is quite a spread in the concentration of publicly available charging points in local areas. That is partly because some areas have more on-street parking than others. Some have more off-street parking, and we would expect more private charging points there. The conventional wisdom would suggest that we should look at the places that have a low concentration and try to get them up. Actually, I think there is an argument the other way: places that already have quite a high concentration of charging points benefit from network effects, and we could concentrate on building up the number of electric vehicle users there. They are in very different types of places. London has a significant concentration, but so does Milton Keynes, Dundee, Oxford, West Berkshire and South Lakeland. A wide variety of places have relatively high concentrations of charging points relative to the population.
On regulation, I hope that the Minister will be able to say more about the required availability of charging points in new-build homes. I also hope that he will say something about electricity tariffs and ensuring that all domestic consumers can benefit from lower-cost electricity overnight, when the market rate is cheaper, in order to charge vehicles. I think this is outside the remit of the Department for Transport, but if fleet buyers create an extra surge of demand for electricity in one particular area, who bears the cost for upgrading the kit?
Most important of all on the issue of consumer acceptance is the fact that the product has to be in the consideration set. Whatever other cars consumers look at buying or hiring, they should at least think about an electric vehicle. Therefore, just getting people behind the wheel of one of these cars to try them out is a great opportunity. I wonder about the potential of a mass test-drive campaign across the country.
We should also think, perhaps less ambitiously, about the role of the dealer. We have concentrated an awful lot on manufacturers and consumers, but we have not thought much about the car salespeople.
Will the right hon. Gentleman give way?
I am not sure how many colleagues intend to speak, but I have taken quite a few interventions and did not plan to go on quite so long. I will take my cue from Ms Nokes, but am very happy to give way.
The right hon. Gentleman spoke about the importance of ensuring that people think about purchasing an ultra-low emissions vehicle when they buy a car. Many people buy second-hand cars, a lot of which are ex-fleet. Does he agree that if the Government want more fleet purchases, they should consider their own fleet buying? Ensuring that fleet managers buy ultra-low emissions vehicles will, in turn, feed the second-hand market. The Government have an important role to play as a large fleet operator.
The hon. Lady tees me up with precision and grace. I was just coming on to the role of Government and the wider public sector. The Government car service has bought a lot of electric vehicles. Something of premium significance is what I would call totemic fleets. Seeing police officers driving electric vehicles has quite an effect on people’s perceptions of the performance of those cars.
Most of all, we need debate, conversation and analysis centred not on the machine and the technology, but on people and the different segments of the population whom we need to persuade to take up electric cars. We need to think about who the first target is and, although fleet buyers are an obvious and important segment, beyond that, should the target be drivers who have the highest mileage per year, or drivers who change their car most often? Evidence from consumer surveys suggests that it is much easier to persuade someone to get an electric vehicle as the second car in a two-car household than as the first car—we need to think about that. The requirements of commuting and the school run, for example, are very different.
I have spoken for longer than I anticipated, but I will briefly mention something slightly off-topic that could reduce the overall number of journeys. In the last few years, there has been a big growth in home shopping, with vans driving around delivering parcels, some of which are very small, to people’s homes. I welcome the e-cargobike initiative, which seeks a modal shift to electric bikes for the last mile of deliveries, but I wonder whether we could be more ambitious. Amazon lockers are fine for Amazon, but they are a proprietary facility. Our massive network of post office retail outlets has potential as a hub and spoke system for home shopping purchases to be dropped off and collected, which also bring much-needed business and footfall to post offices. That was slightly off-topic, so I will return to the broader point.
This country has an important and special role to play in decarbonisation. As well as domestic action, we have a role through international development and climate finance. We showed great leadership in Paris for COP 21, and we have in COP 26 another great opportunity to convene and make global progress.
So much can be done locally. Many councils are doing innovative things, including my own in East Hampshire, with walking and cycling initiatives, plans to plant a tree for every resident and local housing development, particularly in the town of Bordon. Like colleagues in the Chamber, I have local groups in my area that show remarkable leadership, starting with children. I am always impressed that schoolchildren are showing thought leadership on climate change. We have great local groups, such as the Alton climate action network and, soon, the Petersfield climate action network.
The greening campaign began in my constituency back in 2008, and was all about helping individual families and households to know what simple and practical things they could do to help tackle climate change. The campaign eventually spread to 100 towns and villages far and wide. Colleagues may disagree, but in terms of civic society action on climate change, East Hampshire is perhaps the most active area in the country. Members of Parliament can play a really important role to make those things happen.
We should recognise success in decarbonisation in the UK, while acknowledging that we need to step up our efforts. We must never underestimate the scale of what we need to do—I doubt that anybody here in Westminster Hall is likely to do so—but we should not suggest that nothing has been achieved, because if we do that, people begin to feel disheartened and we will lose public confidence and engagement.
Will the right hon. Gentleman give way?
I am sorry, I had better not.
People need to know that there is a big problem, but we are making progress and need to accelerate that progress. They need to know that we can and will do what is necessary. Ultimately, countries like ours need to do more than our fair share because people look to us for leadership. We had our industrial revolution first, so it makes sense to have our decarbonisation revolution first too. Transport must be at the heart of that.
Only five Members wish to speak, so I hope that each will be generous with the time that they leave for others. I call Lyn Brown.
I am very grateful to serve under your chairship for the first time, Ms Nokes, and I look forward to doing so again in future.
I am grateful for the opportunity to talk about the green transformation that our transport system needs. More than anything else, we need affordable and accessible public transport, with electric buses and zero-carbon trains, right across the country. We need to make good green investments now, and to stop making dirty investments.
City residents already emit far less carbon from travel. Londoners’ transport emissions are less than half the UK average. That is because we have a decent bus, tube and train system—we have to invest those systems to create the benefits in our cities and towns—but we still have to make London’s transport greener.
We must stop making dirty investments. The dirty investment closest to my constituency is City airport in Newham, from which I am sure that many hon. Members have flown. It is a lovely little airport, I will admit, but I have constantly opposed its expansion. As a young woman, I even went to the public inquiry to advocate against it being built. I heard all the rubbish that residents and my friends and neighbours were told about how the airport would be contained, would not grow and would not impact on their lives. When I visited my mum and dad in the block of flats where I grew up, however, the back of my throat was coated with fuel—I could taste it. Dad has had throat cancer and mum has had breast cancer, although I am sure that none of that is related.
It is not just about airports. I want to focus on another big local decision: the Silvertown tunnel. In east London, we have a problem with public transport connections across the river. Some might say, “Who wants to go to the south side?”, but some people do and the lack of connections is a major problem. The lack of decent public transport links means that people drive—they see no other option. The Blackwall tunnel and all the roads around it are hugely congested; the queues go on for absolutely miles, pumping out carbon and deadly pollution all the while. The new tunnel is not the solution.
I am told that building Silvertown will cost an estimated £1 billion, using a private finance initiative, so local residents will have to pay for the construction of the new tunnel through tolls. To ensure that the tolls pay, we will also toll the Blackwall tunnel and probably the Rotherhithe tunnel, while the crossing down at Thurrock is also tolled. So, the people of east London, where child poverty is massive and poverty in general is undeniably high, will pay for the joy of going south of the river, while the people of west London can pop across a number of bridges. There are also good transport links in west London—but not in the east. That, however, is not the only reason I am against Silvertown. I am against the tunnel because its construction alone will cause massive carbon emissions: more than 153,000 tonnes of carbon dioxide, the same as the total emissions of more than 28,000 UK residents last year.
If everything that the tunnel’s big business backers say about the construction of the tunnel were true, at least there might be some benefits from having it once it is built. I am afraid I do not believe that, and I am sure that many Members in the Chamber would not believe it either. We know that when a road is put in, people use it. They see it as an even better opportunity to get into their car and to drive and, before long, that road too is congested. I am not the only one who does not believe in those benefits, because on the record are my hon. Friend the Member for Greenwich and Woolwich (Matthew Pennycook) and Newham, Hackney and Lewisham Councils. We all oppose the tunnel, as do more and more of my residents as they find out what is happening on their doorstep.
The truth is that the roads leading up to the tunnel are already massively congested, and no one is planning to widen them, so the congestion is likely to continue. In a best-case scenario, the queues will possibly die down in the immediate lead-up to the tunnel—to begin with. Even if that happens, however, I fear that all the extra traffic will simply be diverted to a bottleneck further down the road towards Barking and out to the east, or on to our already choked local roads, as people attempt to divert around the problems. Congestion might therefore not fall at all, despite the new tolls on all the crossings in the east—I think I mentioned that, but it is a bit of a bugbear.
Why is big business so in favour of a tunnel at Silvertown? It will be taller than the Blackwall tunnel, which was built almost 150 years ago, I think, and massive lorries will therefore be able to go through it from south to north. Also, those heavy goods vehicles, unlike bicycles, have been promised a special lane of their own—they will share the bus lane. HGVs, the big nasty polluters on our roads, will get special concessions to get through the new tunnel. We know why they are so keen to see HGVs going through the Silvertown tunnel: conveniently, a three-storey, 24-hour warehouse and lorry park is planned for not far away from it. That will be at least 2,500 extra lorries a day from that distribution centre alone.
The stakes are high in such decisions—we all accept that. In Newham, 16,000 children attend schools close to the feeder roads in Silvertown, with a similar number in Greenwich. We already have high air pollution at illegal levels. Newham, where Silvertown is—in case anyone was in any doubt—has the worst toxic air quality in the country. The British Heart Foundation estimates that breathing the air is as bad for health as smoking 159 cigarettes annually, stunting child development and leading to 96 premature deaths every year.
The impacts are not just local. This is not only about Silvertown but about the type of decisions that we are making. We need to make the right decisions now in order to prevent a climate disaster. We need to protect our children from these outrageous decisions that will significantly impact on their health. I plead to anyone who will listen: please, think again: stop expanding Heathrow or City airports, stop the Silvertown tunnel and do not build that lorry park. Let us invest in green transport links instead.
I now put Members on a five-minute time limit.
I congratulate my right hon. Friend the Member for East Hampshire (Damian Hinds) on securing this debate. It is an interesting subject, and one that I had personal experience of not that long ago, when I was a special adviser in the Department for Transport.
I am proud that the Government have set the net zero target for 2050, and glad that today we saw two further moves in that direction: the 2035 target to stop new diesel and petrol vehicles, and the aviation sector moving towards net zero by 2050. Over the past couple of decades, it has been wonderful to see the UK at the forefront of the major developed economies of the world in slashing its carbon emissions, and I hope that that continues.
I will pick up on a few things, the first local to North West Durham. We are without any form of rail network at all. In order for my constituents to move towards decarbonised travel, we need better bus networks for our rural communities and in particular for Consett and the conurbations around it in the north of my constituency—one of the largest conurbations in the country without any form of rail access. I am campaigning for the Government to look at rail in the area there as part of their scheme to reopen lines.
Consett had four railway lines in 1950 but has none today. Rail is imperative not only for the environment but for productivity and to link Consett and the surrounding villages into the northern powerhouse. We need to be linked properly to the national rail network, whether by light or heavy rail.
The hon. Gentleman is making a good point about the lack of rail connectivity in his constituency, and that is replicated pretty much across the UK. Does he agree that the UK Government’s £500 million Beeching replacement fund is totally inadequate to increase the rail connectivity required?
The entire purpose of the fund, in my understanding, is for a couple of rail schemes that are almost ready to go and for an investigation into further schemes. I agree 100% that the fund will not put many lines back in place, but for that to happen they would have to be shovel-ready. The funding that the Minister is dealing with is to investigate and to conduct feasibility studies for a lot of those lines. I desperately hope that my line from Gateshead to Consett will be one of them.
My right hon. Friend the Member for East Hampshire also made an important point about walking and cycling. The Derwent Walk replaced our rail line—as many Members know, when rail lines were dug up, they were often replaced by walking and cycling lanes. I am keen for those to be kept in place, so that the rail line has walking and cycling alongside it. That is important, because the car parks at stations are already clogged and overcrowded, as other hon. Members know if like me they commute from far away. As much as possible, I want people to walk and cycle to stations, to help move towards net zero, in particular as regards transport emissions.
In my constituency, too, we have a huge amount of new building. We are one of the fastest-growing parts of the north-east. I would like to see all new-build homes having electric charging points for cars, as mentioned. We have Nissan in the north-east, which I visited recently; it is making a massive move towards electric car production. Now that the Government have announced that they will introduce the target, it is important that new-build homes all have charging points in place.
My final point relates to vehicle excise duty; we need to ensure a stable system in the long term. Vehicle excise duty on motor homes, which are produced in my constituency, increased by 705% in September last year, from £260 to over £2,000. That means that it is less affordable to buy new motor homes, which obviously are cleaner and have Euro 6 engines. It will push people towards foreign flights and travel rather than domestic travel. In the UK, the average motor home travels between 3,000 and 6,000 miles. To tax it as a car is madness, and hurts domestic tourism to places such as Weardale in my constituency, other places across the north-east and other rural parts of the UK.
I urge the Minister to push his Treasury colleagues to look at these changes to vehicle excise duty, which came through last year from European Union regulation 2018/1832. VED has hit domestic manufacturing. The production of ever-cleaner motor homes creates 600 jobs in my constituency. It is incredibly important that we support the motor industry where we can, as well as our domestic tourism, to reduce international flights. That will contribute to exactly what we want to see: the decarbonisation of our transport economy.
It is a pleasure to serve under your chairship, Ms Nokes. It is important to acknowledge where we have made progress. We do not want to discourage our citizens and make them so afraid that they cannot get behind the big changes that we need to make. It is also important to point out where we have made no progress at all, namely on surface transport. It stubbornly remains one of the biggest contributors to carbon emissions in our country, which is why it is so important that we concentrate on it. A lot of the problem has to do with our focus over decades on transport by car. I do not blame anybody; I suspect all hon. Members here are motorists, at least part time. The real issue is, how do we achieve a big shift in this country when there has been a lot of focus on car transport and when there are no proper alternatives?
It worries me that the Government make a haphazard announcement such as that made today about the ban on petrol and diesel cars by 2035 without having a proper plan behind that for infrastructure to support a big shift towards electric vehicles. The Government need to put their mind to that. To give an example, in a consultation meeting with Highways England about new road building in the south-west, which was all well and dandy, I said, “All right, you are building new roads, but what about the infrastructure that we need for fast charging points along our new highways and motorways?” I was told that it was not their problem, so who is talking to who about building new roads and the infrastructure to integrate them with the capacity in our electricity grid? The Government need to put a plan together to ensure that people work on these things in partnership, rather thinking in silos.
Another important issue is how to structure buses and public transport. I went to Berlin over Christmas, but not by plane. Travelling by train on the continent was perfectly competitive, but the bit from London to the channel was incredibly expensive. Unless we change the cost of travel, consumers will go for what is cheapest, and they will continue to fly unless we make train journeys a lot more affordable, particularly in this country.
I am a cyclist, in addition to being a motorist, and have been for many years and have campaigned for cycling. The main problem in this country is not the weather or the hills. There are now electric bicycles and, because Bath is quite steep, I bought myself one, as did my husband, and we got rid of our second car. Those things are important considerations for households. The main hindrance is not the weather or the topography, but safety. As a parent, I was scared to let my children cycle, as are lots of parents. One of the biggest contributors to air pollution and surface transport in my constituency is the school run.
We have been consulting young people about how they would like to travel. Their preferred mode of transport would be cycling independently, but the parents do not want that, so they take them to school by car. That creates a vicious circle. The roads in Bath are full of cars during school time—during school holidays they are not—because parents do not allow their children to go on the road because it is dangerous. We need to break that vicious circle. I urge the Government to look at Cycling England’s proposals for how to create safe cycle routes.
The coalition Government granted large sums of money—I think £20 million went to Manchester and a similar sum to Leeds and Birmingham—under the cycling city ambition grant scheme, and lots of safety measures were rolled out. The problem is that, in towns such as Cheltenham, a lot of that learning is not being rolled out. Does the hon. Lady agree that there is a role for councils to liaise with one another to ensure that safety schemes can be applied?
Absolutely; the Lib Dem Bath and North East Somerset Council is looking at how to provide local leadership, but we also need leadership from central Government to ensure that councils can fulfil their net zero ambitions. I urge the Government to look at proposals from Cycling England about safe cycle routes, because safety is one of the main reasons that young people do not cycle. If they have not grown up cycling, as adults, they do not cycle. We need a big shift to create safe cycling routes.
I congratulate my right hon. Friend the Member for East Hampshire (Damian Hinds) on securing this important debate.
I am going to talk about the X41 bus service. When I was elected, the major issue in Bury North was a bus service that connects the north part of my constituency in Ramsbottom with the centre of Manchester—a service that has been withdrawn because of losses suffered by the provider. That service is the only public transport link between central Manchester and the north of my constituency. In London, it would probably take 15 minutes by public transport to cover the same geography to get to the centre of London. I have one bus that takes the best part of an hour, or an hour and a half when it is busy.
When the bus provider gave notice of its intention to take off the bus service, Transport for Greater Manchester shrugged its shoulders. There was no proactiveness from local authorities to try to save the service. I give that as a practical example of a bus service that takes motor vehicles off busy motorways and A roads. Local authorities and other relevant bodies are not doing enough to support public transport, which is critical for connectivity. Although we may talk nationally—I have noticed in this place that we talk generally about money—on the ground, that bus service matters and continues to matter in my constituency. I am glad to say that the Government supported local MPs to provide assistance to make sure that the service remained.
Buses are crucial in my constituency as a link to other areas in Greater Manchester. The debate about buses must be at the forefront of transport discussions in our area. The hon. Member for Stretford and Urmston (Kate Green) spoke about franchising; all Members representing Greater Manchester want a better bus service. I spoke to Transport for Greater Manchester about that. It answered that franchising would guarantee the level of bus services that we have now. The bus services in Bury North are rubbish, so I do not want that. We need a public transport system that encourages people to get out of their vehicles and use the services of good providers such as Transdev. We certainly are not there at the moment.
I will touch on another of the hon. Lady’s points: the clean air charge, which is affecting Greater Manchester. Some £116 million of funding has been provided to assist the region’s freight and logistics, taxi and other operators to upgrade their vehicles. I have many taxi drivers in my constituency who operate in the area. They will not be provided with the funding required to upgrade their vehicles and they cannot afford to do so. This is an important sector—probably the largest self-employed sector in my constituency—and we Conservatives do not wish business to be burdened, so I ask my hon. Friend the Minister to see whether there are ways to provide moneys to support taxi drivers who need their vehicles to be upgraded and are barely scraping a living as it is.
I strongly endorse what the hon. Member is saying. Small businesses across Greater Manchester, including the taxi firms in our constituencies, are keen to play their part, but they of all businesspeople will struggle to meet costs without financial assistance. We need information about the clean bus and clean freight funds.
I completely agree. A number of small businesses in my constituency are coach companies, which own older buses. Again, those businesses run at very small profit margins, and they need assistance to allow them to continue to provide a service. I hope we can have more information on that.
Those are two important issues, and I know that colleagues in the Government will continue to look at how transport infrastructure and connectivity can be improved in the north and how bus services and all public transport can be supported to ensure that our residents do not need to use their cars. A majority of Bury North residents work outside the constituency, so while cycling and walking is to be admired and supported, they cannot do that to get to work. They want good public transport links. I am sure that my hon. Friend the Minister and colleagues in the Government will do everything possible to invest in the north to ensure that Bury North’s residents are connected to the other urban areas.
As a Conservative, I hope we can find a way to support those local businesses and small businesses that are concerned about their futures and concerned that the cost of clean air charges will be unsustainable for them. I hope my hon. Friend the Minister will comment on that.
It is a pleasure to speak in this debate. I congratulate the right hon. Member for East Hampshire (Damian Hinds) on securing it and setting the scene so well. The contributions so far have been pertinent to the debate.
Our environmental duties are massive, and the more knowledge we have, the more it is incumbent on us to do all we can to safeguard this planet for our children. As a Christian, I am well aware that the end will be when God ordains it, but we are called to be good stewards and caretakers of this wonderful planet that has been gifted to us. Over the holidays, I had an opportunity to do some hunting and shooting over the farm with my son, granddaughter and friends—I declare an interest as a farmer—and while the fresh country air was sharp and cold, it none the less reminded me of how important what we do is. Later that night, there was a programme on TV showing India and perhaps other parts of the world where air pollution was extreme and people were having difficulty breathing, which made me not take for granted the fresh clean air that we have. That is part of the reason why I, along with my son, planted 3,500 trees on farmland about 10 years ago, and I am caretaking areas of biodiversity on my farm. I cannot save the world by myself, but I can make a small contribution, and I intend to do my best to keep our air clean and healthy.
Air quality has been very much in the news in the past few weeks, with the number of deaths in the UK due to air quality at its highest for some time. The figures are high even in Northern Ireland. UK industries account for 1% of air pollution, yet we can do more than make the equivalent of a 1% improvement in the world. It begins in our own homes and stretches out to the influence we have in this place to encourage people to make good decisions and better choices.
Just this morning, the British Vehicle Rental and Leasing Association had a drop-in event in room N in Portcullis House—Members who did not go are too late now—where it referred to the need for hybrid and electric cars. The BVRLA also outlined five policy measures that it would like to see, which include, as I am sure the Minister is well aware, tax benefits, new vehicles, charge points, which are critical, and user sentiment, because at the end of the day, the owners and users of those cars need to be convinced that they are necessary.
I caveat my remarks by saying that I firmly believe that if we want to change people’s routines, we can do so by encouragement and not enforcement. We can jail someone and find they are still not rehabilitated after their incarceration, yet when we take the time to work with people and encourage them, lives are turned around. Let us look at how we make that happen, because the secret to our future security is educating the younger generation and encouraging the older generations—I count myself in the latter category—to do what needs to be done.
The Minister will be aware that in Strangford and Portaferry we had a tidal project, which involved Queen’s University, where we tried to harness the waves. The pilot and initial investigations provided some good ideas, but we need investment for the project to go forward. There are things that we can do; we just need that wee bit of financial assistance to help to make it happen.
We are the generation, as some here will acknowledge, who had milk delivered in glass bottles, and we washed and put out the bottles for the milkman to reuse. We do not mind recycling and we are doing our best, but it must be made clear what is expected of us to do our bit. We are the generation who did not always have a car. We used bikes—we probably do not use them as much as we did in the past—took buses or went by Shanks’s pony. Walking was probably easier for us in those days, as some will understand. We do not mind doing so, but it is important to explain and encourage.
In Northern Ireland we have the Glider bus system from Dundonald right into Belfast. The idea is simple: it is park and ride, whereby people park in Newtownards or the on the edge of Dundonald and get the Glider bus straight into town. It is easier and less hassle, it gives people a bit more time to do something while on the bus, and it produces less emissions. That shows there are good schemes that we can use. The key is not lectures and browbeating, but information and encouragement. Tax breaks and perks for businesses are useful, but we need better infrastructure to encourage public transport and ensure that our young people have their independence while still being safe when travelling. We must encourage the use of car pools and shared resources.
To finish, there is much that can be done from this place, but my word of caution, from an old dog that is learning new tricks, is this. Go easy and bring us with you, and the generation who are used to hard work and innovation will not let you down.
The mover of the motion has indicated that he does not need time to wind up the debate, so that leaves the Front-Bench spokesmen with just over 10 minutes each.
Thank you, Ms Nokes. It is great to see you in the Chair for the first time; I look forward to many more such occasions. I congratulate the right hon. Member for East Hampshire (Damian Hinds) on securing this debate on a vital topic. Clearly his sabbatical from the current regime has been time well spent in bringing forward such topics. I am delighted that we are having this debate because it tackles the most pressing issue we face as a society. Few discussions in this place are as fundamental or urgent as climate change.
In kicking off proceedings, the right hon. Member spoke of his Government’s excellent record. I have to say I disagree with most of that, as I will explain in my speech. He spoke at length about electric vehicles, range anxiety and so on. He also spoke about changing behaviours, and he is right, but there is a need for the Government to provide just as big—if not bigger—a carrot as a stick, not just financially but in providing proper public transport alternatives outside London. That topic came up in the Chamber last week, and there is definitely a need for substantial investment.
Last week, I spoke about the disparity in infrastructure spending across England. The hon. Member for West Ham (Ms Brown) spoke of the disparity in London—the east-west divide—which I was not aware of. Perhaps I will look into that more after the debate.
A new Member, the hon. Member for North West Durham (Mr Holden), rather uniquely, in my experience, began by admitting that he was an adviser in the Department for Transport, and potentially to blame for current policy. That was not how he put it, but it is how I heard it. He made several good points, including his last one, on vehicle excise duty on motorhomes, which I think most of us would is agree is egregious.
The hon. Member for Bath (Wera Hobhouse) spoke of the Government arrangement to bring the ban on petrol and diesel cars forward, albeit without a proper plan to build the infrastructure of charging points. I think I will be able, later in my speech, to develop the point that the Scottish Government have not fallen into that trap.
The hon. Member for Bury North (James Daly) essentially spoke about the disparity between bus services in the north and the south, and about the fact that the bus service in his constituency is extremely poor—something that many in his constituency could agree with. The hon. Member for Strangford (Jim Shannon) speaks on a vast number of issues for his constituents, and I agreed with him when he said that behaviours will be changed by encouragement, not enforcement.
I mentioned the urgency of dealing with the issue that we are debating, and that is reflected in the action being taken in Scotland right now. The Scottish Government’s aim is a 75% reduction in emissions a decade hence and, 15 years after that, a 100% drop, or net zero. Those are ambitious targets—the most ambitious in these islands, no less—but they are achievable without disruption to our economy. Indeed, they have huge economic benefits and use existing technology. Given that 31% of our total emissions come from transport, and more than four fifths of that figure is related to road transport, it is clear that the hard action needed to curb emissions and move to net zero must come through investment and policy decisions aimed at how we move goods, services and ourselves.
Before I move on to the substantive points I wish to make, I want to ask the Minister, on behalf of the large number of hauliers in my constituency, whether he will give an undertaking to bring forward the conclusion of the longer semi-trailer trial, which has now been extended to 10 years. We are eight years into the trial, and many companies, whether they are in the trial or not, need information for the purpose of investing in their future fleets of trailers. They need to know whether the trailers they buy will become obsolete just as they buy them. Some information on that would be useful for hauliers across the country.
The establishment of the UK’s first electric highway along the A9, Scotland’s spine, is the type of bold action that is required if we are to make a successful transition to a net zero economy and the decarbonisation of our transport network. By the end of the first tranche of funding, more than 2,500 charging points will be in place across Scotland. That first step is part of the investment in infrastructure that is needed to phase out the need for new petrol and diesel cars by 2032—investment covering not just public charging points but also charging points at workplaces and in domestic settings. Members will note that I said 2032. That target is still three years ahead of UK Government ambitions despite this morning’s welcome announcement.
In recent years we have had a rail electrification programme that is the largest in our nation’s history. Edinburgh to Glasgow, Paisley Canal, Stirling Dunblane Alloa, and the Shotts and Whifflet lines—in fact all the lines between our country’s two biggest cities—are now all-electric. Virtually all the west of Scotland network has ditched diesel.
Is not there something we should learn in the rest of the UK, given what has happened with rail in Scotland? Does the hon. Gentleman share my disappointment that the previous Government cut back on electrification of our rail network? The learning from Scotland is to keep doing it, because it becomes more cost-effective. There should be a rolling programme, rather than the stop-start that we have seen in other parts of the UK.
I totally agree with the hon. Lady. I was coming on to say that the amount of money that has been wasted on cancelled electrification schemes is shocking. The Government’s commitment must be called into question. We have ambitious plans in Scotland, but if the Government here were to get a move on and invest properly it would release more capital for the Scottish Government to increase their ambitious plans with regard to decarbonising transport.
Is it not true that we always count the costs in the wrong way? Not doing the things we are talking about will ultimately cost us a lot more. Cancelling projects because they are getting more expensive does not take into account the cost if we do not do those things.
The hon. Lady makes a good point. It is a very short-term approach to look at such things in terms of their initial cost. They have to be considered in the medium and long term, particularly in the light of the climate emergency that the Government have announced. Cutting back on such schemes is disgraceful.
Work continues in Scotland, in planning future works. Those include the new metro running through my constituency, which will give Renfrew—currently the largest town in Scotland without a rail station—its first fixed rail link in more than 50 years; and the future decarbonisation of the Barrhead and East Kilbride lines. Scotland aims to make sure that all rail journeys are carbon free by 2035. Perhaps that is the sort of ambition that England and Wales need from their rail policy makers, who have wasted tens of millions of pounds on cancelled rail electrification schemes. That is entirely the wrong signal to send at this time to the public and the rest of the world.
The Scottish Government are doing what they can under current financial and constitutional constraints, but hon. Members who have had the pleasure of hearing me speak on this topic will not be surprised if I bring up Norway at this point. The right hon. Member for East Hampshire has already alluded to results there in response to an intervention by my hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown). Norway’s population is less than one tenth of the UK’s, and it is a country with a great many similarities to Scotland. Its electric car sales outstrip the UK’s, with an almost exponential growth rate. Last year alone, electric car sales increased by 31%, while the figure for petrol cars dropped by the same rate and that for diesel cars fell 13%. The car industry in Norway predicts an even greater demand for electric vehicles this year. By the end of this year there is every chance that half of all new cars sold in Norway will be electric. In the UK, the figure stands at 2.1%, while fossil-fuel cars continue to increase in number.
The difference is that Norway has a Government who are taking concrete action to push electric vehicles, and who are investing in the infrastructure needed, with nearly as many charging points as the entire UK. An independent, northern European, energy-rich country with full access to the single market and the European economic area is leading the way on the sort of bold transport policies that others can only follow, which are possible only with the full powers of a sovereign, independent Parliament and Government. Norway now, and Scotland in the future: one has only to look at the polls over the past week or so to see that the writing is on the wall for Scotland’s continued membership of the United Kingdom. However, I digress, and time is slightly against me.
Norway and Scotland show that leaving decarbonisation to the free market simply does not work. It needs strong policy and intervention from the Government, investment at a local and national level, and the commitment to match. I said before that the Scottish Government do an outstanding job, despite operating with one hand tied behind their back. Indeed, Scotland has shown global leadership by being the first country to include international aviation and shipping emissions in its statutory climate targets. Given its nature, aviation is the toughest of transport modes to decarbonise, but I welcome today’s news that the UK aviation industry has vowed to decarbonise by 2050. The Scottish Government are working with Highlands and Islands Airports and the aviation industry to bring to Scotland trials of cutting-edge zero-emission aircraft, using battery and hydrogen fuel-cell technologies, starting in the Orkney archipelago, where no flight lasts longer than 20 minutes. Indeed, it boasts the world’s shortest scheduled flight, from Westray to Papa Westray, which is shorter in distance than most airport runways, and lasts a minute or so. The Scottish National party will decarbonise flights within Scotland by 2040, and is aiming for the world’s first zero-emission aviation region, in partnership with HIAL.
Meanwhile, the UK Government’s track record is disappointing, to say the least—just ask the former president of COP26, Claire O’Neill, for her take. The feed-in tariff has been scrapped, and Scotland’s renewables have been subjected not just to discriminatory but to utterly shameful transmission charges. Both are key inputs to a decarbonised transport system. The tax and licencing regime delivers little benefit to those switching to electric vehicles, who play their part in driving the change that is needed. It is surely time for the Government to look to our European colleagues for inspiration and ideas. Perhaps that approach is not in vogue down here at the moment—it is certainly not within the present Government—but it would assist massively in delivering the transformational change needed across our network. If the Government are not prepared to do that, they should make sure that Scotland’s Parliament and Government have the powers and the finance needed to do the job properly.
It is a pleasure to serve under your chairship, Ms Nokes, and to respond to the debate. I thank Members who have contributed, and a number of excellent points have clearly been made. I particularly thank the right hon. Member for East Hampshire (Damian Hinds) for securing the debate.
I will make three key points. First of all, on the scale of this problem. Secondly, on the need for an urgent response, as discussed by a number of hon. Members. Thirdly, on the series of policy choices facing the Government now that they have a significant working majority. Before I do that, I will comment, without intruding into private grief too deeply, on the tussle that is quite clearly going on in Government at the moment. It is deeply unfortunate that a former climate Minister has quite clearly had a difference of opinion with her colleagues, which reflects rather badly on the Government’s ability to focus on this vital issue. I urge the Minister—a thoughtful and gentle chap who is very interested in key policies relating to climate change—to please have a word and see if he can sort things out.
We have focused on the technical points, but it is quite simply no exaggeration to point out that the climate crisis is the most urgent and serious problem facing the British Government and, indeed, the wider world. There is quite clearly a need for every Government, private individual, business and charity to take urgent and determined action. However, it is also clear from the debate that this is simply not happening, and that the Government, I am afraid, are failing in this vital area of policy.
I will address the series of policy choices facing Ministers now that they have been returned with a significant majority. My question to the Minister, whom I am sure is listening attentively, is: will the Government now step up to meet these challenges? Will they look at the difficult choices in front of them, or will they yet again fail the public and, more importantly, future generations? So far, I am afraid that the evidence points to continued failure. I urge the Minister to once again refer the matter to his colleagues and urge them to take serious action and to look once again at the fundamentals of these problems.
First and foremost, as the right hon. Member for East Hampshire rightly pointed out, the issue before us is one of road transport. The UK has a car-dependent economy, and we need to address that. This not only is a matter of technical detail but is fundamental, affecting planning and everyday life. I call on the Government to look not only at the subsidies and time limit for selling vehicles but at the whole planning system and the priority it gives to new road building. As I mentioned, the Government have so far taken the wrong choices on this matter. They are putting £30 billion from vehicle excise duty into a hypothecated fund, which is being allocated to new roads. Colleagues who attend Transport Question Time, as many in the Chamber today do, will note a series of Back-Bench Members pitching to the Government for new road building in their constituencies. That is not the way forward; we need to move away from car dependency.
I urge the Minister to listen carefully to my following points about the importance of other modes of transport, which were also ably made by other colleagues.
I very much welcome my hon. Friend’s approach of looking across the whole of transport, rather than focusing only on cleaner vehicles, because that will help us to tackle wider policy issues, including health and social justice. Does he agree that, when making difficult choices—there are difficult choices ahead—the Government should look with interest at the outcome of Climate Assembly UK, which was brought forward by six Select Committees, to see what the members of the public taking part have to say and what recommendations they make?
My hon. Friend makes an excellent point. I urge the Minister to familiarise himself with her work as the Chair of the Select Committee on Transport. The public are further ahead on this matter than we parliamentarians, so it is important that we address these issues. Let me make one further point about the strategic nature of our dependence on road and the policy mistakes so far. There is a stark contrast between the effective subsidy for road use and the use of carbon-powered transport—through the effective cut to petrol duty—and the lack of subsidy for rail travel and other forms of public transport.
To turn to rail, the Scottish National party spokesman, the hon. Member for Paisley and Renfrewshire North (Gavin Newlands), made an excellent point about the need for rail electrification. In my own region of south and south-west England, there is a clear contrast with other parts of the UK. On the railway line just beyond Reading, the electrification abruptly stops at Newbury, which is a long way from the end of the line, which goes all the way to St Ives. I urge the Minister to look again at rail electrification, and to ask his colleagues, particularly the Rail Minister, to look with urgency at this matter. In the Great Western region, there has been a complete failure in the Government’s commitment to electrification. On lines into Wales, the electrification stops at Cardiff, and the whole of south Wales continues to be served by dirty diesel vehicles.
However, similarly to road issues, rail issues go way beyond the technical nature of the vehicles involved. There are also wider questions about the priority given to rail travel over road travel and the strategic choices made by the Government. I urge the Government to look at the work of the German Government, which was mentioned by a colleague earlier. The German Government recently instituted a 10% cut in rail fares across Germany which, as mentioned, is in many ways a comparable northern European country. Labour proposed a 30% cut in rail fares. Cutting fares is likely to have a significant impact on rail use and in taking people out of polluting road vehicles and on to rail, which even with diesel locomotives will reduce carbon emissions significantly. With electrification, it has enormous potential benefits.
However, there is also an issue about ownership. I welcome the Government’s recent renationalisation —as my colleague said, we wish them a happy rail renationalisation day—but would like to see them go further and look at the whole network, and to introduce a clear strategy for managing and developing that network and avoiding the current poor performance of the franchise system and the failure of the complicated ticketing system.
It is a little-known fact that buses are actually the major form of public transport in the UK. I urge the Minister to completely rethink the Government’s failed policy on buses, which is in many ways one of their worst areas of transport performance. Funding for buses has been cut by 45%. The hon. Member for Bury North (James Daly) talked about his own issues on the outskirts of Greater Manchester, which I will come to shortly, but for many colleagues in rural areas, there has been a notable impact on services. Near to my own seat in Reading, Oxfordshire County Council rather foolishly cut all bus subsidies, affecting the population of more than half a million people. There is clearly a need for a complete rethink. Hundreds of routes have been lost.
However, as with rail, there is also a need to strategically rethink the strategy for the whole system. Since the Transport Act 1985, bus patronage has declined and there has been an over-emphasis on a small number of highly profitable routes, because of the nature of the system. We need to look again at the possibility of greater franchising. The hon. Member for Bury North makes a good point about the issue of communities on the edge of networks. However, franchising was retained in London and has been shown to lead to much higher bus patronage.
We also, as a country, need to address the success of municipal bus companies. In Reading, the bus company is outstanding and has growing patronage, and the same is true of Nottingham, where my hon. Friend the Member for Nottingham South (Lilian Greenwood) represents a seat. Municipal firms have a great deal to offer. Municipal transport is widely known on the continent and is associated with many centre-right Governments, so I urge Ministers to reconsider the previous—somewhat ideological—opposition to this common-sense, practical and effective form of local accountability.
In summary on buses, I call on the Minister to look at the overall level of subsidy and to address capital investment in the sector, with a view to encouraging more electric buses, and also to look at the management of bus services, to make them more effective and more responsive to local needs. This was so wisely pointed out in the case of Greater Manchester, where I believe that the Mayor is looking at franchising with a view to improving services in the very outer boroughs, which the hon. Member for Bury North mentioned.
I agree with a lot of what the hon. Gentleman says. As a new Member of Parliament who has spoken to those who are in charge of the consultation and putting forward the policy, my concern with franchising is that I have not been told that the services are going to be expanded, or that services in my area that are completely reliant on some form of subsidy will receive that subsidy. I support the idea in principle, but I fear that it will not lead to the expansion of the service, a better service or a more regular service. Does he have any views on that?
I thank the hon. Gentleman for his point. I think that the issue is local accountability. Certainly, when we look at franchising in the country as a whole, it is clear that the franchising system has worked extremely well in London where it was retained. There is a widespread desire among Mayors and other leading figures in local government to expand franchising. I ask the Minister to allow all local authorities to consider both franchising and remunicipalising bus companies to improve services in areas such as the hon. Gentleman’s constituency and many others around the country, including rural constituencies.
I appreciate the pressure of time, Ms Nokes, and will be brief on my final point. As the hon. Member for Cheltenham (Alex Chalk) pointed out, it is crucial that we do not address transport just through vehicles, but look at active travel. There is huge scope in this country to encourage walking and cycling. Points were made about the topography of some British cities, but they do not apply in many parts of the country. Many urban and many semi-rural areas are relatively flat, but we perform very badly compared with other northern European countries. We are way below the levels that we should be achieving. At the moment, the projected increases in walking and cycling are not taking place—we are clearly flatlining. When we look at the wider context of the lack of investment in this area compared with road transport, it is clear that greater capital investment is needed. That is why we would have committed substantial moneys to that, and I urge the Minister to do that.
In my own town of Reading, the simple measure of a bridge across the Thames specifically for walking and cycling has led to a transformation in the journeys made by commuters to Reading station. That is a simple example of the many benefits of capital investment in this sphere. That issue has been noted as regards London and Manchester, and I am sure that the Minister will address it in his closing remarks.
I am aware of the time, Ms Nokes, but I also ask the Minister, as he considers this, to please talk to his colleagues in other Departments and integrate policy with wider measures to tackle climate change.
May I say what a pleasure it is to serve under your chairmanship, Ms Nokes? In the time available, I shall do my best to set out the Government’s strategy and to deal with the many points that were raised.
First, I thank my right hon. Friend the Member for East Hampshire (Damian Hinds) for calling this debate on the importance of decarbonising the transport sector. As the first Minister for the decarbonisation of transport, I welcome this opportunity and the many contributions from Members from, I think, all parties in the House. We have seen quite a lot of expertise, including from the former Chair of the Transport Committee, the hon. Member for Nottingham South (Lilian Greenwood), and I have heard an awful lot with which we agree, including on the scale of the challenge of global climate change and the imperative of gripping transport decarbonisation now. There was an important point about avoiding climate anxiety while stressing the urgency of the situation. We do not want to depress people, particularly the young, by making out that this task is impossible.
We also heard about the real strides that we have made as a country and the need for the transport sector now to lean in and show the leadership that the energy sector has shown. I was particularly interested in the points that my right hon. Friend the Member for East Hampshire made about behavioural insights and understanding the real barriers to EV uptake and modal shift—indeed, we are putting a lot of emphasis on that in the strategy—and about the need for a smooth evolution of the support framework.
As the first Minister for the future of transport, focusing on decarbonisation, digitalisation and disconnection, I, with my right hon. Friend the Prime Minister, am absolutely determined that we will take an integrated approach. That means putting people and places—neighbourhoods—at the heart of the vision for transport, looking at what the transport sector needs to do to put people and places first and looking at our research and development programme across Government to ensure that we are backing the right innovations in technologies to support future green transport. To that end, we have established in the DFT a new directorate for the future of transport, which has seven workstreams and seven directors, dealing with R&D, finance, place, data, regulation, decarbonisation and the importance of behavioural insights as well of ensuring that we go with the grain of people’s aspirations for their families and their constituencies.
I do not want to take up too much time agreeing with everyone on the scale of the crisis. We have only to look to what has been happening in the past few months around the world—to Australia, to our own floods and to the rate of polar ice melt and the rising sea levels—to know that this is the defining global challenge of our generation. I can feel in this Chamber the appetite across the parties to show the electorate in this country, after the divisions of the past few years, that we are united in ensuring that we tackle it.
Let there be no doubt that this Government are 100% committed to leading—not just delivering but leading —and therefore we must accelerate our action to reduce greenhouse gas emissions to avoid longer-lasting consequences. That will mean reducing car dependency and building lower car dependency into the new houses that we are building, and that is why I was delighted last week to announce on the east-west arc, for example, that we are focusing on rail links to the new housing.
The decisions that we make will affect the future of the planet for generations to come. This is urgent. I am delighted that, as I am speaking, the Prime Minister is sitting down having just given his keynote speech defining how important this is for the Government. We will have to show new models of leadership globally, and that is why hosting COP this November is vital.
I will just take this opportunity to say that since Mrs Thatcher was, famously, the first western leader to warn of the pace of this back in the 1980s, we saw a few decades of quite slow progress until the last decade. I pay tribute to the right hon. Member for Doncaster North (Edward Miliband), David Cameron and Nick Clegg for putting together a consensus that we needed to act 10 years ago.
The Climate Change Act 2008 was the first of its kind in the world and made the UK the first country to have legally binding long-term emissions reduction targets, and we should be proud of that. Since 2000, we have decarbonised our economy faster than any other G20 country. Last year, with support from this House, we became the first major economy to set a legally binding target to achieve net zero emissions from across the UK economy by 2050. That will end our contribution to global climate change, but it does not mean the end of prosperity. I am equally proud that we have created more than 400,000 jobs in this sector. We need to be clear that green growth is more sustainable, resilient and globally exportable, and creates more opportunities for the next generation of people in this country.
Between 1990 and 2017, we reduced emissions by more than 40% while growing our economy by more than two thirds. Green growth works. However, we are not complacent—
Will the Minister give way?
I will not, just because I am very short of time to respond to the debate.
Delivering net zero will require genuine transformation of our economy and society, including our homes, transport systems and businesses. Although challenging, it offers tremendous social and economic opportunity, but we will have to go further and faster to build on our track record, with transport front and centre.
I shall list briefly the things that we have done. This is a very significant demonstration of leadership. Our £1.5 billion ultra low emission vehicle programme is the envy of the world. We have just announced the £400 million charging infrastructure fund, which will see thousands more electric vehicle charge points installed across the UK, both superfast chargers at motorway service stations and domestic chargers. The first £70 million of that will create another 3,000 rapid charge points. With the private sector, we are on track to deliver £1 billion for charging infrastructure. I am genuinely delighted that the Prime Minister has this morning announced the Government’s intention to bring forward the ban on petrol, diesel and hybrid cars and vans to 2035, in line with the Committee on Climate Change’s advice.
On shipping, we have the clean maritime plan. On rail, we have set the ambition to remove all diesel-only trains from the network. On aviation, we have helped to lead the world in setting up that first and seminal international agreement for emissions reduction, and here in the UK we are investing £1.5 billion in future aviation technology. Yesterday, I visited the E-Fan X, a partnership between Rolls-Royce and Airbus at Cranfield pioneering the first electric plane.
We will have to invest in science and technology longer term, as well as modal shift for healthier and happier places short term, and to that end I will shortly be announcing with my right hon. Friend the Secretary of State our first ever transport decarbonisation plan. That will set out for the first time an approach for each mode—road, rail, shipping and aviation—and an approach by place. We want to look at the worst motorway junctions and railway stations, and we want to use digital tools to help to track standard emissions per passenger kilometre. And there will be a plan for science and R&D investment longer term, including for important technologies in areas such as hydrogen and carbon capture and storage—there is a whole range of technologies that can help us to drive both the modal shift and the emissions reduction.
This is about harnessing the power of our science and innovation and our digital economy to help lead the world in how to empower today’s travellers, passengers, drivers and households to make green choices. Imagine the power of a green Citymapper that will allow people to choose low-emission journeys and then reward them. That is very powerful and something that we need to look at.
Crucially, this will not all be done by top-down diktat from central Government; it will require—this is one reason why I welcome it—a bold new deal of devolution with towns and cities, and so I am in the process of working round all the Mayors of combined authorities.
We are short of time. Let me close by saying that if we are to achieve this objective, which we are determined to do, it will require not just science and not just devolution for modal shift; it will require, I suggest, a pan-Government approach on a par with that which we took in the build-up to the Olympics—a genuine decarbonisation olympiad, which will need to happen on a cross-party basis and inspire the next generation with the belief that we can do it.
Perhaps, with their permission, I can write to the hon. Members who raised specific questions with the detailed answers that I have written out but have no time to read out now.
Question put and agreed to.
That this House has considered net zero targets and decarbonising transport.
Innovation in Hospital Design
I beg to move,
That this House has considered innovation in hospital design.
It is a pleasure to serve under your chairmanship, Ms Nokes, and to hold this important debate. Last September, the Government gave the green light to 40 new hospitals, as part of the health infrastructure plan. For my Basingstoke community this means support for a hospital replacing a much-loved building, built over 40 years ago.
We wanted a new hospital six years ago. While it is important to refresh those plans, because we are now talking about a district hospital, not just a critical treatment hospital, we already have a great deal of work in place. The initial community consultation has identified widespread support. The ambulance service has identified the location that would save more lives. The local council has given planning consent for a hospital to be built.
What about the building itself? If we are to realise the full benefits of this once-in-a-generation opportunity for our healthcare infrastructure, we need not the fad of the moment, but the best design for our hospitals based on evidence and the needs of clinicians, patients, staff and the community, as well as research at home and abroad, to create the best blueprint for local trusts to use for the next generation of NHS hospitals.
Guidance on how to design a new hospital, provided by the NHS to hospital trusts, has been called “out of date” by Architects for Health, an organisation dedicated to improving healthcare design. That should concern us. I hope that the Minister will reassure me that any new hospital will benefit from the best design thinking based on the best evidence around the world.
Many of the crucial design factors identified through research by design experts are completely absent in many hospitals within the NHS estate. Many of our hospitals, including our hospital in Basingstoke, were built for a different era of medicine. The buildings have been modified, added to, partially knocked down and rebuilt, and prefabricated units have been built in front of old units. Any sense of coherence in the design of our hospitals has long been lost.
I hope the right hon. Lady agrees that, historically, hospitals have been built away from where those services were most needed, causing issues with the recruitment of consultants and doctors, who then have to work with a demographically and geographically diverse population. I hope that location is given full consideration when new hospitals are designed.
The hon. Lady is absolutely right. That is why I was pleased that the NHS trust in Hampshire went to the emergency services and asked where the best location for a hospital would be. They identified junction 7 on the M3—an area not unknown to you, Ms Nokes—as a fantastic location. It would be convenient not only for staff, but for the ambulance service, so that it could can save more lives. All these issues must be taken into account.
We have experience of building hospitals since Basingstoke and North Hampshire Hospital was built in the 1970s. Newer private finance initiative hospitals have often been debated in this place. Interesting research has been done on their design, showing that the innovative use design was inhibited because private finance saw those hospitals foremost as an investment vehicle, and tried to reduce risk by using conventional design and construction methods—looking to the past rather than the future. We cannot make the same mistakes again.
What makes a good hospital for now, or, better still, for 2060, when these hospitals will still be operating? Based on the past 40 years of experience, we know the next generation of hospitals must be flexible in their design, not only to accommodate change, but to be built with change in mind and not as an afterthought. I am sure that some elements can be standardised, but the overall design must be flexible. Some new hospitals are built with the intention that they may have an entirely different use in the future. In our communities there are successful examples of buildings that began with one intended use and have moved to another, but they are few and far between. We need to ensure these hospitals have that flexibility, to scale up, change, scale back and even change use entirely.
Patient treatment is the prime function of a hospital, but so is patient recovery. The prevalence of multimorbidity requires a different way of thinking. Perhaps people with mental and physical illness—indeed, those with both simultaneously—should be treated side by side. Rightly, our focus is on early detection and prevention, so part of any new hospital must be mobile, to take prevention of disease into the heart of our community, with the permanent migration of some services from hospitals to the community, including simple diagnostics and therapies.
Research from the US demonstrates the importance of the right environment for patient recovery, including noise reduction, air quality, green space, daylight and seeing nature. Unsurprisingly, all those elements promote good health in well people, too. In 1984, a study by Roger Ulrich proved that a view through a window of a natural setting—perhaps the Hampshire countryside—would aid recovery. Those who had a view of a natural scene had a shorter stay and fewer complications and required less pain relief than those with a window facing a brick wall. Those are not new ideas. Florence Nightingale insisted on every ward being flooded with sunlight, with windows that opened to bring in light and ventilation lifting the spirits, but that is not the case for every ward in my hospital and hospitals around the country.
Staff retention is one of the most acute issues for the NHS. NHS staff are hugely loyal and dedicated. The hundreds of people in Basingstoke who work in my local hospital go above and beyond every day in bringing the best care to my constituents. However, where we work matters, and we should not rely on that loyalty and dedication but reciprocate it. We need to think about how design can improve everyday working lives.
Office design has evolved over the past 40 years, creating spaces that encourage creative collaboration. However, in hospitals things have not changed much at all, yet collaboration and creativity are just as relevant in medicine as in commerce, as are training and upskilling, which should be designed into these new buildings.
Of course, a hospital’s environmental impact also needs to be minimised. The importance of renewable energy and public transport links goes without saying, but we need to take account of the actual design of the hospital, to ensure that it is a design that the surrounding community can be proud of, and so the hospital does not look as if it has landed from outer space and instead fits with the natural setting; a hospital should be a building that will add to that natural setting and not detract from it.
For this new generation of hospitals to be truly sustainable, there needs to be a move away from the disposable hospital design of the 1970s, which was perhaps used when the hospital in Basingstoke was built back in 1972. A building that is flexible and that can be repurposed is a building that is sustainable, which is the approach that we must take.
Each and every one of the 40 new hospitals will be a huge investment for taxpayers, and it is right that approval procedures are rigorous. However, I hope that my hon. Friend the Minister can assure us that, despite that rigour, the long-term benefits of the best working environment for staff are not traded for a short-term reduction in cost.
Hospitals are absolutely extraordinary places that do extraordinary things on a routine basis. They are places where we experience the most emotional experiences in our lives; they are the places where new life is brought into the world and where we face our darkest moments. I will always remember the birth of my three children in Queen Charlotte’s Hospital in London, even though there was a decision to move the hospital after the birth of my second child and I had to go to a new location for my third child. Nevertheless, to be surrounded by experts in maternity and midwifery was an extraordinary experience, and we always have a debt of gratitude to hospitals that have served us in that way. Now Basingstoke hospital is looking after my mother and my father in an extraordinary way, and we should always recognise the incredible lengths that the NHS goes to, in order to ensure that we have the right support in place at the right time.
That is why communities have such a profoundly emotional attachment to their hospitals. That is a challenge that the Government face as they introduce their plans for 40 new hospitals, because they must recognise the impact of any change to a building with which people have an emotional bond and attachment, whether they have had a baby or visited a dying relative there. We need to understand that and take the community with us.
I hope that my hon. Friend the Minister can outline today how the Government will ensure that this once-in-a-generation opportunity—these 40 new hospitals for communities right across the nation—involves good design. That means design that helps to provide the best treatment, the best recovery, the best staff retention and the best for our environment, and such design should be at the heart of each and every new hospital, because we must build hospitals for the future and not simply replicate the past. We also need to recognise the emotional role that hospitals play in the lives of our families and our communities. We must work with the people the NHS serves to ensure that this groundbreaking development of the NHS estate is understood, embraced and welcomed.
It is a huge pleasure to serve under your chairmanship for the first time, Ms Nokes.
I congratulate my right hon. Friend the Member for Basingstoke (Mrs Miller) on securing this incredibly important debate about innovation in hospital design, which I know is an important subject for her. She has worked tirelessly to secure a new and better hospital to serve her constituents in Basingstoke, who I know are grateful for the enormous amount of work that she done. I also know that she will continue to hold our feet to the fire in the Department of Health and Social Care, to ensure that the new hospital is the very best that it can be.
As my right hon. Friend said, the Department has invested heavily in the NHS, providing large amounts of capital investment to hospitals, as announced last year by the Prime Minister and the Secretary of State for Health and Social Care. Ensuring that this investment delivers innovation in health infrastructure is absolutely vital, as we move forward towards a health estate that is fit and able to face the challenges of the future.
We announced a new health infrastructure plan, or HIP, to deliver a long-term programme of investment in our NHS estate, buildings and equipment. This will be the biggest and boldest hospital-building programme in a generation, supporting our health service so that dedicated NHS staff, who are quite marvellous, can give patients world-class care in world-class facilities.
Under the new HIP, we have made a long-term commitment to build 40 new hospitals over the next decade, including to the Hampshire Hospitals NHS Foundation Trust in my right hon. Friend’s constituency. As she knows, the trust will receive £5 million in seed funding to develop plans to renew the ageing estate and better align services at the hospitals in Basingstoke and Winchester.
The 20 hospital upgrades that we previously announced are already under way. That is on top of a capital commitment, amounting to around £3.3 billion, provisionally awarded to over 170 sustainability and transformation plans since July 2017. That capital investment is going into a wide variety of programmes right across the country, including new urgent care centres and integrated care hubs—which bring together primary and community services—and, of course, new mental health facilities.
This investment programme will totally transform the health infrastructure in this country. It presents a unique and exciting opportunity to implement the latest innovation in healthcare design, with all the benefits and advances of modern methods of construction. Getting this right will ensure that patients receive the right treatment—treatment that speeds up their recovery and makes the most of the working environment, ensuring that our wonderful NHS staff can work in facilities that support them to deliver the very best in patient care.
The impact of the built environment on patient outcomes and staff satisfaction is increasingly clear. My right hon. Friend has already referred to it, but academic research conducted by the University of Sheffield shows that patients make significantly better progress in new, purpose-built and designed buildings than in old ones. There are a range of impacts, including reductions in pain medication needs and shortening hospital stays. In the mental health sector, treatment times were reduced by 14%, and in the general medical sector, non-operative patient treatment times were reduced by a staggering 21%. That is the prize here.
There is also growing evidence that access to and visibility of green space is vital to promoting therapeutic environments that aid recovery, with positive health outcomes including reductions in stress and anxiety, increased social interaction and, of course, an improved healthcare experience.
There has been some really interesting recent work in this space, which the Department welcomes. For instance, the Royal Horticultural Society donated its feel-good garden from the 2018 RHS Chelsea Flower Show to Camden and Islington NHS Foundation Trust. Its permanent home is now at Highgate mental health centre, one of the trust’s two in-patient psychiatric sites, and it is dedicated to improving the care of older adults with acute mental illness.
As my right hon. Friend said, there is nothing new about that approach. Florence Nightingale—who I know is deeply ingrained in your constituency, Ms Nokes—had it right from the beginning. My constituency of Gosport houses Haslar, a military hospital built in 1756 that has long, well-lit buildings, beautifully landscaped gardens overlooking the Solent and, critically, many out-buildings—smaller structures where the war-wounded would be wheeled out to take the air and look at the beautiful views of the Solent that we still enjoy today. Buildings designed to maximise natural light and views of green space, with increased natural ventilation and reduced noise levels, make for a much more pleasant environment, not only for the patients, to aid recovery, but for the staff going about their work.
As my right hon. Friend said, there is mounting evidence that there are strong links between the design or layout of buildings and the job satisfaction of staff, thereby improving staff retention. Buildings should be designed in a way that makes it easier for staff to do their job. For instance, designing the layout of a health building in a way that aligns with patient flow and clinical pathways also contributes to increased staff satisfaction, which makes sense. Staff can dedicate more time to patients because the time spent walking between linked wards and clinical services is reduced.
Naturally, we want to ensure that the modern clinical design of buildings is also cutting-edge in the way it supports environmental sustainability. The large hospital projects selected for phases 1 and 2 of the Department’s health infrastructure programme have been instructed to ensure that they combine and contribute to the reduction in the NHS carbon footprint by following the framework developed by the UK Green Building Council on net zero carbon buildings.
As well as seeing innovation in hospital buildings, we want to see environmentally conscious design. The NHS has led a new-for-old programme, which improves delivery of local community-based infrastructure as well, so these things are not only for the big new acute hospitals. The new-for-old programme is adopting a variety of sustainability measures, including something called BREEAM, which stands for the Building Research Establishment environmental assessment method—that slips off the tongue. It will be incorporated as standard, as independent third-party verification of sustainability performance in infrastructure.
The design of estate has a massive part to play in achieving net zero carbon targets, and carbon efficiency measures can have a positive effect on both patients and staff. For example, installing energy-efficient LED lighting in every hospital will produce average energy cost savings of up to £33 million and, importantly, improve the clinical environment for patients and staff. Adopting renewable energy solutions in the design of clinical facilities also contributes to cleaner air for our communities and better health outcomes.
Our building programme will take advantage of innovative design and innovative construction methods, and we are encouraging the NHS to take advantage of a range of modern construction approaches, including off-site manufacturing and standardisation, such as repeatable room design. Such methods can enable new and better buildings to be built quicker than otherwise would be possible. They can open their doors to patients sooner.
The Minister rightly talks about new and innovative methods to build buildings quicker, and that is very important, but my concern about getting these things finished is not about the building; it is about the approvals processes. Given the benefits that she so eloquently outlines in having the additional 40 new hospitals—benefits to patients, but also to the taxpayer—what space is there for the NHS to speed up the programme? It is clearly long overdue and to the benefit of all our constituents.
My right hon. Friend is absolutely right to raise that point, and I will come to it later in my speech. The key thing is to ensure that all the relevant stakeholders and partners are brought to the table very early so that everybody understands exactly what the plan is and has a feeling that they have bought into and invested in how that plan unfolds.
Earlier, I mentioned the importance of innovation, repeatable room design and standardised components, which very much lead to the flexibility that my right hon. Friend talked about. That means that the NHS can adapt to future advances in delivering modern patient care, and it delivers time, cost and efficiency benefits. For example, the Wrightington Hospital orthopaedic centre uses repeatable rooms, and that is already delivering benefits to patients and staff, but it also means that the rooms can be changed in future as modern innovation delivers changes. It is also critical that innovative building design integrates the benefits of technology and infrastructure to make full use of its transformative potential for service delivery and patient care.
As my right hon. Friend says, it is important to ensure that the designs are delivered fast. The schemes must be built in a way that works with the local community. The buildings must be easily accessible, sustainable and integrated with the local planning infrastructure, and scheme proposals and business cases developed in partnership and in alignment with sustainability and transformation plans, integrated care systems and clinical and estate strategies. They need written commissioner support, alongside evidence of engagement with local stakeholders and their support for the plans. We hope that will speed up delivery of the buildings.
I hope that goes some way towards reassuring my right hon. Friend that the Government are absolutely committed to maximising innovation in the high-quality hospitals that we are delivering. We are going to seize this once-in-a-generation opportunity, and we will work tirelessly to ensure that the people of this country are receiving the care they deserve in buildings that are modern, functional and beautiful. I thank her for securing this debate, because it has given me an opportunity to outline how we intend to do that, but I am sure she will continue to hold us to account when it comes to delivering on that commitment.
Question put and agreed to.
[Sir Charles Walker in the Chair.]
I beg to move,
That this House has considered climate justice.
It is a pleasure to serve under your chairmanship, Sir Charles. I thank Mr Speaker for granting the debate, and I welcome the Minister to his place. I also thank colleagues for being present, including those who have long spoken out in this place on climate change, climate justice and ecology.
Climate justice is a term often brandished around, but personally, and for the purposes of the debate, I take it to mean addressing the climate crisis in a way that is fair and equitable. Climate justice links human rights and development to achieve a people-centred approach, safeguarding the rights of the most marginalised people and sharing the impact of climate change equitably and fairly, because we know that those least responsible for climate change suffer its gravest consequences.
Disadvantaged groups will continue to be disproportion- ately affected as climate change persists. Those groups will be affected due to inequalities that are based on differences in gender, race, ethnicity, age and income. The fourth national climate assessment report of the Intergovernmental Panel on Climate Change found that low-income individuals and communities are more exposed to environmental hazards and pollution.
Climate change is already forcing people from their land and homes. Oxfam found that climate-fuelled disasters were the No. 1 driver of internal displacements over the past decade, forcing an estimated 20 million people a year from their homes.
Is the hon. Lady aware that the New Zealand Government have awarded visas for climate refugees so that they can live in New Zealand, and does she think that that will develop further over the coming years?
I thank the hon. Gentleman for his intervention; that is a very good point. I certainly think that in the wake of the climate crisis we have to reassess our definition of economic migrants.
The World Bank warns that, without urgent action, 143 million people will be displaced in sub-Saharan Africa, south Asia and Latin America by 2050. As the Joseph Rowntree Foundation has rightly stated, climate justice is about not only ensuring that nobody is unfairly affected by climate change today, but recognising that future generations have rights too.
I congratulate my hon. Friend on the debate. She is making an excellent speech. Does she agree that, based on some of the analysis that she has already referred to, the costs of not dealing with climate justice will far outweigh those of doing so, given the legacy that we will leave for future generations and what they will have to clear up?
I agree with my hon. Friend. There will be no future generations on a dead planet. As the Joseph Rowntree Foundation has stated, climate justice is not just about us here and now; it is about future generations too. I thank her for raising that point.
Continuing to burn fossil fuels or expand aviation, and compensating by paying poorer countries to offset those emissions, risks only worsening and entrenching current inequalities. Will the Minister categorically rule out the UK dumping our carbon reduction obligations on to developing countries? Failure to reduce emissions and adapt to the impacts of drastic climate and ecological breakdown threatens to reverse hard-won development gains and to increase poverty, inequality, hunger and humanitarian disasters.
I thank my hon. Friend for introducing this important debate, especially in the light of the fact that the UK will host the COP26 vital meeting later this year, which is really our last chance to come up with a meaningful plan to tackle carbon emissions. The Government have used very warm words on tackling the climate emergency, but does she agree that those words ring hollow when a UK Government agency, UK Export Finance, continues to fund new oil and gas projects across the world that, when complete, could amount to as much as a sixth of the UK’s total annual carbon emissions?
My hon. Friend makes a pertinent point. Indeed, current emission reduction pledges from the international community are insufficient to meet the Paris agreement goals and instead put us on track for a terrifying 3° of warming.
Despite the UK hosting COP26 later this year, more than 90% of the £2 billion in energy deals struck at last month’s UK-Africa investment summit were for fossil fuels. Will the Minister clarify how the deal struck by the Prime Minister last month is consistent with the Government’s stated aim of tackling climate change and setting an example for other nations?
Even with all the evidence before us, and in spite of the rhetoric, the UK Government are pressing ahead with Heathrow expansion. They have effectively banned the cheapest form of renewables, new onshore wind, through restrictive planning measures and removal of subsidies. They have cut frontline environmental agencies, such as Natural England, to the extent that they cannot even meet their basic statutory duties. Meanwhile, the UK is missing nearly all our international biodiversity targets, and species decline and habitat neglect and destruction are taking place at an alarming rate.
The hon. Member is making a compelling speech. Does she agree that we should add to that litany of charges against the Government the fact that they continue to measure their emissions in terms of our production emission reductions rather than our consumption emission reductions? If we started to take account of what we consumed in imported emissions, the very bad progress that we have already made would look even worse.
My hon. Friend makes an important point. I thank her for that, and for her many years of work in Westminster on climate justice.
In the light of all this, it comes as little surprise that on BBC Radio 4 this morning, Claire O’Neill, the former president of the UN climate summit in Glasgow, said that the Prime Minister has admitted to her that he does not even understand climate change. Will the Minister lay out what major changes—not promises, consultations or strategies, but tangible changes—have taken place or been set in motion since the House passed Labour’s climate and environment emergency last May?
Does the Minister agree that it is imperative that the UK gets our own house in order, and is seen to be making substantial progress on decarbonisation, climate change, adaption and habitat restoration, ahead of hosting COP26? Will he outline investments and actions in the pipeline between now and November—specifically, investments in infrastructure to create the green, clean jobs of the future? Will he clarify whether the Prime Minister is indeed entirely ignorant about climate change, as claimed by his former colleague? Lastly, is there a reason why the climate sub-committee has not met since it was first announced, and on what dates is it scheduled to meet?
There is a huge opportunity in Glasgow later this year, but decisions must be made and acted upon that keep fossil fuels in the ground, transform our food systems, decarbonise our production and consumption, restore ecosystems, and completely change our economies at a scale that matches the enormity of the crisis at hand.
Many Members will be alarmed by reports from the former president of the UN climate summit that the Government are
“miles off track”
in setting a positive agenda for COP26, and that promises of action
“are not close to being met”.
What does the Minister have to say in response to assertions that preparations for COP26 are
“mired in chaos and confusion”?—[Official Report, 3 February 2020; Vol. 671, c. 34.]
In the light of those significant concerns, will the Minister agree to provide the House next month with a substantive briefing update on preparations for COP26?
The question of how to support the countries most affected by the impacts of climate change has been a long-running debate at COPs over the years and is an important factor in achieving climate justice. After a year that has seen the likes of Hurricane Dorian and Cyclone Idai inflict extreme losses on disadvantaged communities across the developing world, addressing the issue of climate finance can no longer be delayed. Will the Minister outline for us the UK’s position on climate finance for poorer nations? How does he propose to involve disadvantaged groups in the planning and policy-making process, so that those individuals have a say in their own future?
It is imperative that developing countries receive the support they need to adapt to the impacts of climate change and reduce their own emissions. Developing countries should not be forced to choose between schools and medicine and coping with climate breakdown. Will the Government commit to working with others at COP26 to develop new sources of climate finance, such as a polluters’ tax, so as to not rely on the overseas aid budget alone?
With the addition of paragraph 51 to the COP21 decision accompanying the Paris agreement, developing nations reluctantly agreed that loss and damage could not be used to claim compensation from richer nations. Will the Minister outline the Government’s position on paragraph 51 and say whether he supports calls by the US to further exclude countries not signed up to the Paris agreement from any liability for the impacts of climate change?
Action to tackle climate change is increasingly being viewed through the lens of human rights, internationally and legally. As has been seen in some key strategic cases, the human rights basis for litigation on climate change has increasingly resonated with judges. New lawsuits have been able to draw on advancements in attribution science to establish a critical causal link between a particular source of emissions and climate-related damage, so the message to the world’s biggest polluters is clear: “Your time is up.” The communities most impacted by the reckless and short-termist actions of Governments and major polluters are, with increasing frequency, having their day in court. Will the Government take a human rights-based approach to climate change ahead of COP26, supporting those most impacted by, and most vulnerable to, the impacts of climate breakdown?
People of my generation are here to claim our right to a stable planet. We are here to shake decision makers out of their comfort zones, because the kind of action needed to address the urgency and scale of the climate and ecological crisis can take place only outside of those comfort zones. If the Government are sincere about the scale and urgency of the problem, we will not continue to hear about endless plans, pledges and consultations, but will see concrete actions in the here and now. COP26 is a historic opportunity that simply cannot be botched, yet sadly everything we have seen and heard points to this whole process being recklessly mismanaged under the stewardship of this Prime Minister. I will end with some advice from the outgoing president of the UN climate summit:
“My advice to anybody to whom Boris is making promises—whether it is voters, world leaders, ministers, employees or indeed, to family members—is to get it in writing, get a lawyer to look at it and make sure the money is in the bank.”
That is what all of us in this room must resolve to do.
If everybody sticks to about six minutes, we should get all Back Benchers in. If you do not stick to six minutes, I will introduce a time limit.
I begin by congratulating the Prime Minister on launching the UN climate summit in London today. I had the pleasure of working with Sir David Attenborough last year on tackling plastic pollution, and I am delighted that such a revered conservationist has today supported the Government and the UK’s role as a world leader in tackling climate change. I welcome the call this morning for international action to achieve global net zero emissions. I also thank the hon. Member for Nottingham East (Nadia Whittome) for securing today’s debate on the important subject of climate justice.
In my view, the science is clear: if we continue to pump greenhouse gases into the atmosphere, climate change will continue to get worse and temperatures will continue to rise, along with associated impacts and risks—particularly severe and frequent extreme weather, including flooding, which affects my constituency of Stafford. To avoid the worst impacts of climate change, we need to stop adding to the greenhouse gases in the atmosphere. I was pleased that in 2008, the UK passed the Climate Change Act with huge cross-party consensus, becoming the first country in the world to set a legally binding target for reducing greenhouse gas emissions. I am also pleased that the target is now to achieve an 80% reduction in those gases by 2050 from their 1990 levels. The Government should be congratulated on their support for, and investment in, clean energy since 2010.
Reducing the impact of climate change is a matter of great interest to my constituents. We are currently having a public consultation across Stafford borough, through which residents, businesses and organisations have the opportunity to give their views on the draft climate change strategy produced by Stafford Borough Council. This follows the council’s declaration of a climate change emergency last year, with a commitment to be carbon neutral by 2040.
I am very pleased to hear about what is going on in the hon. Lady’s local authority; a similar approach has been taken by Hounslow council, and I congratulate it on having done so. Does she agree that not only should everybody participate in those opportunities where they are available, and that the House should send out that message, but that where local authorities are not taking those steps, they should be strongly encouraged to do so by the Government?
I absolutely agree with the hon. Lady. I congratulate Stafford Borough Council on having been recognised as one of the leaders in our region by a Friends of the Earth survey of local authorities, showing that it has done a huge amount on this issue. I also draw attention to the city’s successful introduction of a number of initiatives to reduce carbon emissions, as well as the number of plans for the future that the council has introduced, such as installing solar panels on the roof of our civic centre and attempting to reduce energy consumption in our county council buildings.
I am pleased that last year, the UK became the first major economy to legislate for net zero by 2050. By having declared net emission goals, Britain is a front runner, along with a number of other countries including Norway, Iceland, Sweden, Costa Rica, France and New Zealand. I was also pleased that this morning, the Government announced that we will be moving away from petrol and diesel vehicles, bringing the phase-out date forward by five years—from 2040 to 2035—or earlier, if a faster transition is feasible. Of course, that must be subject to consultation. We should also consider including hybrids for the first time.
The Government should continue to work with all sectors of industry to accelerate the roll-out of zero-emission vehicles, helping to deliver green jobs in the UK, including in my constituency of Stafford.
As somebody who has had an electric vehicle for a few years, I can attest to how incredible they are. However, there continue to be issues with easy access to vehicle charging, as well as the costs of the vehicles themselves. Does the hon. Lady agree that, if there is to be the roll-out we want, prices need to come down and the industry needs to do more to ensure that electric vehicles are affordable for ordinary families across the country?
The hon. Lady makes a good point. In my constituency, it is hard for someone with an electric vehicle to find a charging point, so I am encouraging the borough council to roll them out across the constituency.
Climate change is a global challenge that affects us all, not just within our national borders in the UK but around the world. It makes us vulnerable to the impact that rising temperatures are having on the weather, food production and water resources. As climate extremes worsen, the world’s poorest countries and communities will be most affected. I agree with some of the points made earlier by the hon. Member for Nottingham East.
I acknowledge the work of UK aid, which has helped more than 47 million people to cope with and adapt to the effects of climate change and natural disasters. I am proud of the Government’s commitment to spend 0.7% of our gross national income on overseas development assistance. We must ensure that our aid is congruent with the goals of the Paris agreement.
I will give a few examples to show how the Department for International Development makes a real difference on environmental issues. UK aid works with the Met Office to provide communities in developing countries with state-of-the-art weather information. In Uganda, it helps urban planners to identify the impacts of long-term climate change on urban water, sanitation and hygiene systems.
Cutting-edge British research has identified the fact that the Sahel faces three times more mega-storms, some of which are the size of England, than previously. I am proud that British scientists are working with city planners and officials in Burkina Faso to help to decide where hospitals and schools should be built and to protect them from future disasters. UK aid has provided 17 million people with improved access to clean energy, which should be commended and, I hope, continued by the Government.
I encourage the Government to continue to invest in clean green technology, to preserve our natural habitats, and to take measures to improve resilience to climate change. I am pleased that today, the Prime Minister reinforced his commitment to tackle climate change and biodiversity simultaneously, recognising the important role of restoring our natural habitat.
Hosting COP26 will be a major opportunity for the UK and nations across the globe to step up the fight against climate change. Five years on from the Paris agreement, it is a fantastic opportunity to build on our world-leading net zero target and push for international progress to tackle climate change. I am pleased that the Government have set out an ambitious 2050 net zero target. We must also remember that, last year, the UK went coal-free for 18 days, which is a record. The UK has also pledged to phase out unabated coal completely by 2025. We must use COP as a springboard to expand the Powering Past Coal Alliance and to urge others to join us in pledging net zero emissions. There is no greater responsibility than protecting our planet and that mission should be central to the Government.
The UK has a proud record of tackling climate change. We should raise our ambition this year to enable a greener future for all our children. I welcome the fact that today marks the kick-off of a year of climate action, with events taking place in all four nations of the UK. I encourage fellow hon. Members, businesses and charities to participate in the run-up to the upcoming summit in November.
It is a pleasure to serve under your chairship, Sir Charles. I congratulate the new Member, the hon. Member for Nottingham East (Nadia Whittome), on securing this timely debate. I am sure there will be many more, but it is good to start having the debate as early as possible.
The climate crisis will affect us all, but not everybody will be affected equally. If we allow it to get worse, it will create huge global inequalities on a scale that we have never seen. Some parts of our planet will be much worse hit than others, which will create extreme poverty, hardship, displacement and possibly even war. Those who are worse hit will be those already living in poverty and struggling against extreme weather conditions.
As a Liberal, I care deeply about people from every part of the world. People in China, Argentina, Nigeria and Iran are our neighbours, which is why I try to call out human rights abuses wherever I witness them. The point has already been clearly made that climate justice and the fight for human rights are directly linked. I feel called upon to avert the climate emergency, because it is about justice across the world and, ultimately, the human rights of people who live in areas of the world that will be much worse affected than here.
At our last conference, the Liberal Democrats agreed a credible plan for how the country could cut most of its emissions by 2030 and get to net zero by 2045. Our approach is evidence-based and pro-innovation. We need to put British innovators at the forefront of the fight against climate change. I agree with many hon. Members who have said that we do not need to be doom and gloom, but we do need a plan to effect change. The most important question for this debate is how we do that fairly in this country.
In the context of climate justice, fairness means protecting the low paid, the elderly and the just about managing from higher costs. It means an understanding that if an electric car costs more, only some people will be able to buy one, and thinking about how we can continue to offer choices that are affordable to everybody. Of course, we need to make sure that we build sustainable public transport links and that public transport is affordable—currently, even that is not an affordable choice for many.
Does the hon. Lady agree that there are opportunities in the housing sector to embed renewable infrastructure in new housing developments and flats, so they are built with renewables and electric charging points in mind, and that we can take the opportunity to embed sustainability in the construction sector in this year of all years?
I completely agree, but unfortunately, the path to building net zero homes was stopped under the last Government. As a new Member, the hon. Lady is probably best placed to encourage the Government to make sure that we build carbon zero homes. In fact, our target is for them to be carbon zero by 2021 and at Passivhaus standard by 2025, because that is where we ultimately need to get to. That cannot be the reserve of only those who can afford it, however, so how do we build a sustainable housing programme for social and affordable homes, not just the private sector?
Fairness means that the energy efficiency of social housing and rented property cannot be an optional extra but must be a requirement for anyone wishing to be a landlord, so that it is part of letting a property for social housing providers and private landlords. A fair transition is the only way to fight the climate emergency while protecting the ideals of climate justice. A fair transition also ensures that people buy into the more radical choices involved in climate action. The climate emergency will affect us all, but it will affect some of us more than others. The longer the Government wait to implement meaningful climate action, the more people will suffer. We are running out of time to smoothly switch to a net zero Britain without compromising our health, happiness and freedoms.
At the core of the Liberal Democrat plan to get to net zero is a just transition commission to understand where the biggest economic impacts of changing to a net zero society will be, and to create future jobs before the job losses in fossil fuel industries are incurred. We need to set up citizens’ assemblies to involve all parts of the public in the discussion, so that we formulate together the aims and ambitions for getting to net zero fairly. Most of all, the Government have to set out a credible coherent plan to set the direction for how the UK will get to net zero.
As the country that led the industrial revolution, we have been one of the biggest polluters over time. We as a country have a moral duty to provide global leadership to tackle the climate emergency here and across the world without delay.
I congratulate the hon. Member for Nottingham East (Nadia Whittome) on securing this very important and timely debate. Today, the UK published its 2018 carbon emissions, which showed that carbon emissions in the UK fell by 2.1% in 2018, down to 451.5 million tonnes. I mention that number because it helps to put into perspective the challenge ahead of us.
I want to speak to a solution that might not immediately jump to colleagues’ minds as a cost-effective course of action for the UK Government to take. That solution is empowering women and ensuring that girls have access to 12 years of quality education and to the same family planning choices as women get here in the UK. I was astonished to learn that that intervention alone is the single most powerful and most cost-effective step that we can take, as a world, to reduce the amount of carbon that we will emit by 2050. It is truly astonishing. Some studies have said that such a step could save as much as 120 gigatonnes of carbon from being emitted by 2050; other studies have it at more than 100 gigatonnes. A gigatonne is 1,000 million metric tonnes of carbon and the UK emits 451.5 million tonnes of carbon, so we could save 240 times what we currently emit annually.
It is a startling statistic that I thought deserved further investigation, and I discovered that it comes about through a range of different interactions. Education speaks for itself, as we can see from extensive studies. For example, the International Institute for Applied Systems Analysis discovered that a woman in Africa who has no access to any kind of family planning will have, on average, 5.4 children, if she has no education at all—that is the mean outcome. If she goes to secondary school, she will have, on average, 2.7 children. If she goes on to a college education, she will have 2.2 children. One of the effects of girls’ education is that women choose to have their families later and they tend to have closer to a replacement number of children. It also, of course, has an incredible impact on the ability of a women to earn over her lifetime, but it is the impact on carbon emissions that I found particularly startling. Some 214 million women do not have access to modern birth control. If we give them the same kinds of choices that we have in the UK, that would add up to some very startling statistics.
To put the numbers in perspective, if we had comprehensive global coverage in onshore and offshore wind, that would save 98.7 gigatonnes. If we completely managed our refrigerants, that would save 89.74 gigatonnes. Reducing food waste would save 70.53 gigatonnes; switching to a plant-rich diet would save 66.11 gigatonnes.
Girls’ education is so valuable on so many fronts—as is, within that, the Government’s objective to champion 12 years of education for everyone. It is not just a good thing in and of itself, and good for the world economy; there is this startling statistic of how education combined with access to UK levels of modern family planning would save 120 gigatonnes of carbon being emitted into the atmosphere by 2050.
It is a pleasure to serve under your chairpersonship, Sir Charles. I congratulate my hon. Friend the Member for Nottingham East (Nadia Whittome) on securing this debate.
My generation grew up to the sound of climate warnings. Before I was even born, the Intergovernmental Panel on Climate Change had said that human activity was to blame for a planet that was quickly getting hotter, and every few years since, it has warned that we are on course to do “irreversible damage” to ecosystems and species. Two years ago, it said that preventing climate catastrophe would require,
“rapid, far-reaching and unprecedented changes in all aspects of society”.
Since its first meeting more than three decades ago, CO2 emissions have risen by more than 40%. They continue to rise, and the powerful continue to ignore the warnings.
The effects are with us now. This winter, Australia burned and Indonesia drowned. Twenty-nine people died in the fires and 66 people drowned in the floods. Across the world, we see it again and again. The Solomon Islands are disappearing beneath the Pacific, forcing people to flee. Mozambique was battered by two of the worst storms in the continent’s history last year, which claimed the lives of more than 1,300 people. The Amazon rainforest—the lungs of our planet—was set alight by warmer, drier weather and reckless profiteers. Here in Britain, floods are hitting us harder and more often. Climate breakdown is with us already, but still the powerful ignore the warnings.
Will the hon. Lady give way?
I apologise to the hon. Member—because of the time limit, I must progress.
There was a time when many denied the science, but today there is a different kind of denialism. They do not deny the science—they deny the politics. They pretend that business as usual can combat the climate emergency, and that banning plastic straws, using bags for life or tweaking the system is enough. I am sorry—it is not, because the problems are not individual. They are collective. It is the same politicians who tell us to ban plastic straws who have left MPs’ pensions invested in deadly fossil fuels, so hon. Members will understand why we do not have high hopes for COP26 later this year and why we expect more platitudes and more hypocrisy. I ask hon. Members to take a lead from the students who have forced their universities to divest, and to divest now.
To prevent the climate emergency from becoming a climate catastrophe, we have to face up to what is driving the crisis. The answer is clear. It is a capitalist crisis, driven by capitalism’s need for expansion and exploitation. It is not the fault of a few bad apples; the entire system is rotten. It is a system that rose with the coal mines and steam mills that powered Britain to global dominance, and trashed the world’s climate to win wealth for colonial powers. Today, the global south still pays the price. If the climate crisis is a capitalist crisis, it is a neocolonial crisis too. Those least to blame—the global south and the global working class—will be hardest hit. While the world burns, the rich will build higher walls to protect themselves. They will let climate refugees drown and the dispossessed starve.
That is one future, but there is another. If we unite people across borders, and recognise that in this fight our enemy travels by private jet and not migrant dinghy, we can have a global green new deal, and it will look like this: dismantling the fossil fuel industry; taking resources away from a handful of private profiteers, and using them to plan a better future; insulating our homes and designing new green industries; building free public transport and creating millions of good, unionised jobs. That is how we unite black and white, north and south, migrants and those born here, people in Britain and people overseas. We all have an interest in survival. That is how we can build a world that is truly our own, with opportunities for all.
Plenty of people will call me naive, but the real naivety is to pretend we have another choice. My generation grew up watching global leaders bail out banks but ignore the warnings of a planet on fire. To stop that, we must finally make good on the promise of an old socialist hymn. With a global green new deal, we will
“bring to birth a new world from the ashes of the old”.
It is a pleasure to serve under your chairship, Sir Charles. I congratulate the hon. Member for Nottingham East (Nadia Whittome) on a compelling speech and on securing this important debate.
Climate change is happening now, and those who have done the least to cause it are the ones who stand to lose the most. Climate justice, to put it bluntly, is a question of who lives and who dies. With a commitment to reaching net zero emissions now in law, I want to look at three areas that will determine whether the UK’s climate pathway will be a just one: the speed at which we decarbonise; how we decarbonise; and the degree of co-operation shown to other nations as we do.
First, speed. From a climate justice perspective, a net zero target of 2050 is simply not good enough. The Paris agreement commits countries to try to hold the global temperature rise to 1.5°. In its landmark report, the IPCC headline was clear: to stay below 1.5°, global emissions must halve by 2030 and reach net zero around mid-century. Let us remember that that is for only for a greater than 50% chance of staying within this level of heating, which, to me, does not sound like comfortable odds. By any measure of fairness, the UK has a clear responsibility to go faster than the global average. We are historically one of the biggest emitters. We started the modern fossil-fuel age with the industrial revolution, and the UK is one of the very largest per capita contributors to present climate change. We also have a greater capability than other countries. We are the fifth biggest economy and we have a GDP per person over two and a half times the global average, so we have to go further.
What would an equity-based emissions reduction target for the UK look like? Professor Tim Jackson from the University of Surrey has given us a rough guide. By taking the IPCC’s per capita carbon budget for 1.5° and adjusting it to allow each person in the poorest half of the world 33% higher emissions than each person in the richest half as an example of how to work on an equitable basis, Professor Jackson estimates the UK’s share of the remaining global budget as two and a half gigatonnes of CO2. On our current emissions reduction trajectory, counting only the UK’s production emissions, we will smash through that target in 2026. If we aim to reach net zero in 2050 on a linear emissions pathway, we will use around two and a half times our fair share of emissions, but if we are to include our consumption emissions—something I will return to in a moment—the budget on our current trajectory is exceeded in 2023, and a linear emissions pathway to net zero in 2050 would consume around four times our fair share.
There are many other ways of trying to cut the climate cake. Looking at it from a from an equitable perspective, a greenhouse development rights framework was set out in the 2019 report by the Committee on Climate Change on net zero. It cut the cake slightly differently, but it pointed out that the UK would have to reach 100% net emissions reductions by 2033 at the latest if we were to proceed on an equitable basis, and that means that by 2050 we would need to be net negative, drawing down more than half of our 1990 level of emissions. To be absolutely clear, however politically expedient a 2050 net zero target might be, it cannot be said to be just. It will further exacerbate the inequalities that climate change presents and push the burden once again on those who have done least to cause it.
A second consideration when it comes to the issue of justice is about how we make the transition, which has major justice implications both for those in the global south and for future generations. Now that net zero has become the established shorthand for climate action, let us examine what that little word “net” in net zero actually means. In the Committee on Climate Change pathway to net zero there lies positively heroic, for which read criminally reckless, assumptions about the potential for negative emission technologies to suck carbon out of the atmosphere. Let us be really clear that the technologies are mostly yet unproven and in some cases entirely unknown. In other words, we are simply passing the buck to our children. They are the ones we hope will sort it out with some kind of technology. We do not even know what it is yet, and I think we should be honest about what we are doing. The level of warning we have currently locked in means that we are bequeathing to future generations a more dangerous world to inhabit. Leaving them with the burden and cost of highly speculative technological solutions is a grave injustice that we should avoid.
Finally, I want to talk about international co-operation. The UK does not exist in a climate vacuum. We have emitted far more than our fair share of the historic carbon budget. It has seen our economy, our wealth and our living standards increase dramatically, but it has also seen the lives of other people imperilled. We and other rich nations have used so much of the atmosphere’s capacity that we have pulled up the ladder behind us, excluding developing countries from the path that we have travelled. Natural justice dictates that we must now support other countries to adapt to the growing impact of climate change and compensate them fairly for losses and damages where adaptation is no longer an option. It requires a new fossil fuel-free development pathway, where less affluent countries leapfrog to a clean and sustainable future of higher living standards. One aspect of that concerns the transfer of technology. The UK leads the world in offshore wind and CCS development. We must transfer and make them available for the poorest countries to harness cheaply. As hosts of the UN climate summit this November, we have an incredible opportunity to reach out internationally in true climate leadership, to begin to make the reparations for the injustices of climate change and to take responsibility for the full impact of our trade, money and influence.
I have spoken about the kind of accounting that allows us to make it look as if our emissions have reduced far faster than they have. When we account for consumption emissions, our progress looks much less significant. It is also the case that our money and influence is used to actively fuel emissions overseas and lock other countries into the next generation of fossil fuel infrastructure. As the hon. Member for Nottingham East pointed out, more than £1.5 billion of UK Export Finance money went into oil and gas projects. It is no wonder the Environmental Audit Committee and Bond, the UK network for development organisations, have called for an end to all UK Export Finance support for fossil fuels. That is what I want to underline yet again. I know that it has been asked before by the hon. Member for Nottingham East, but I want to urge the Government Minister to demonstrate some seriousness when it comes to climate justice and at the very least to rule out any further use of UK Export Finance for fossil fuels.
I congratulate my hon. Friend the Member for Nottingham East (Nadia Whittome) on securing this debate and on giving us an opportunity to discuss the climate crisis. It is the greatest existential threat of our time and climate justice is becoming increasingly urgent. It is timely that this debate has been called ahead of Parliament’s voting on the Government’s Environment Bill. As colleagues know, much has been made of the Government’s ambitious target to decarbonise by 2050, but it is simply a headline. At the moment, it is a plan.
When we talk about climate change, we speak about the climate emergency. The summer saw swathes of the Amazon burn, and Australia is currently fighting the wildfires that have gripped areas the size of our own counties, so we are right to speak in terms of an emergency. However, I fear there is no recognition of that emergency in the Government’s response to the crisis so far beyond declaring one. There is no sense of urgency. There is more CO2 in our atmosphere now than at any point in human history, so before we pat ourselves on the back for small reductions in production—as has been mentioned, the offshoring of our share hides the truth on consumption—we must remember that we need to up our game and set out a radical course of action. We cannot let COP26 be a cop-out. It is our last chance to correct the path to climate disaster.
Locally, Sheffield City Council has declared a climate emergency and has set out a carbon budget with the Tyndall Centre, which shows the city would use its entire budget for the next 20 years in less than six. Rightly, it has set a course to try to get to net zero by 2030. Before Christmas, again, communities across South Yorkshire experienced flooding. The impact of an international crisis played out locally. If the UK was serious about preventing climate breakdown, we would not be seeing more investment going into drilling in new oilfields or building more pipelines. Instead we see UK-headquartered banks and the Government bankrolling fossil fuel extraction and directing more and more finance to fossil fuel companies, rather than solutions to the crisis. If we were serious about climate justice, the Government would regulate and penalise private banks for providing billions for fossil fuel extraction at home and abroad.
Between 2016 and 2018, HSBC gave $57 billion to the fossil fuel industry. Barclays, the biggest funder of fossil fuel infrastructure in Europe, gave almost $25 billion to fossil fuel companies in 2018 alone. The Government offered only £100 million of private investment for renewable energy investment in sub-Saharan Africa in 2018, which shows the difference in scale. Through their campaigns, organisations such as People & Planet and Greenpeace have brought to light the fact that our banks have been acting like fossil fuel companies with the amount of extraction they are financing, showing a determination to see the industry continue. It needs to stop. Without further regulations and legislation for our financial system there will be almost free rein to continue to make our worlds toxic and to continue to push us over the cliff we are balanced on, with temperatures potentially soaring by three degrees, which we know will be catastrophic.
Average wildlife populations have already dropped by 60% in 40 years, so we must act now and take our responsibilities seriously or risk further loss of species and populations. The Government are not exempt, either. In June, the Environmental Audit Committee exposed how UK Export Finance had been using British capital to finance fossil fuel extraction in the global south, undermining the effect of the UK’s carbon emissions cuts and any commitment to climate justice.
The climate crisis is a threat to us all, but we do not all face it equally. In fact, we must remember those who have already tragically lost their lives, swept up in the climate disaster, trying to protect communities and fight for the frontline of public services across the world. The Government need to end their support for climate colonialism and penalise banks that are accelerating climate breakdown at the frontlines. Climate justice absolutely requires recognising and mitigating the worst effects of the crisis and facilitating environmental migration in response to disaster displacement, which is unavoidable at this point. Fundamentally, we need to take a radical approach. Let us take as our starting point the root cause of the issue—where our Government are accelerating and exacerbating climate breakdown. Climate justice means acting now to stem the worst effects of the crisis, and for that we need to take aim at the banks that are choking our future. Our inaction is also choking our future. We continually raise the issue not to try to be a thorn in anyone’s side, but to be the roots that can lead to a shoot of hope for future generations.
Thanks to the discipline of colleagues, the Front-Bench speakers have approximately 12 minutes each, leaving two minutes at the end for the Member who moved the debate to sum up.
As ever, it is a pleasure to serve under your chairmanship, Sir Charles. I congratulate the hon. Member for Nottingham East (Nadia Whittome) on securing this hugely important debate. The beginning of the new Parliament is the perfect time to raise the issue.
I am delighted to be continuing in my role as the Scottish National party shadow International Development Secretary. I am particularly focused on the need to tackle climate change globally and to ensure that there is climate justice. That, I believe, will be a regular topic, if not the key topic, in this Parliament, and the defining feature of the next decade. Prior to last year’s general election, I was proud to propose the opening resolution—passed by acclaim—at the SNP conference on climate justice. We recognise that, while it has been the most developed and industrialised countries that have been the biggest contributors to carbon emissions, it is the poorest communities in the world who feel the devastating impact of climate change. We must recognise this reality and our obligation to right this wrong. Countries that have become prosperous while damaging the environment have a responsibility to help developing countries adapt to the consequences of climate change.
That is not just empty rhetoric. The SNP Scottish Government have been at the forefront of the global fight, tackling climate change and delivering climate justice, and showed bold leadership in establishing the world’s first climate justice fund in 2012. By 2021, £21 million will have been distributed through the fund, which is now supporting projects in Malawi, Zambia, Tanzania and Rwanda. Some of the fund’s successes so far include establishing 217 village-level committees to support water resource management and resilience, improving agricultural practices and irrigation services for more than 11,000 people, and providing 110,000 people with training in climate change. Going forward, the climate challenge programme in Malawi will support rural communities to identify and implement their own solutions for adapting to and building resilience against the worst effects of climate change.
Similarly, the climate justice innovation fund will support projects that are developing innovative solutions for strengthening African communities against the effects of climate change. The most recent projects to have secured funding address deforestation, food security and rural water supplies, while also empowering women, youth and other disenfranchised, vulnerable stakeholders in those communities. Through the climate justice fund, the Scottish Government are promoting the economic benefits of a just and fair transition to a low-carbon economy. The fund aims to share the benefits of equitable global development and the burdens of climate change through a people-centred, human rights approach.
What I have outlined has been done with a fund of £21 million over nine years, which has delivered incredible results. Just think of the potential if the UK were to follow the same model, given the scale of its resources. We hope that, through our example of leading on the issue of climate justice, we can embolden others in the international community. It is therefore vital that the UK Government follow the Scottish Government’s lead. Indeed, last year’s report by the International Development Committee on UK aid for combatting climate change highlighted the usefulness of climate justice as a framework for policies and programmes and called for the UK Government to adopt the concept of climate justice explicitly, to guide its international climate finance spending. However, that has so far been misrepresented or misunderstood by Secretaries of State or other Ministers when addressing the House of Commons, or has simply fallen on deaf ears.
The report was also clear that DFID must have adequate resources. Evidence to the Committee suggested that DFID’s capacity and expertise on climate had been reduced in recent years. That is not indicative of a Government who are tackling climate change and climate justice at the heart of their agenda. It is vital that DFID rectify that and that it should have sufficient members of staff who have climate expertise and are focused on climate programming. Furthermore, DFID must remain a strong stand-alone Department if the UK is serious about climate justice. Development spending must be focused on helping the poorest and most vulnerable, and on alleviating global poverty. If we are to embrace the concept of climate justice and help the worst-off deal with the effects of climate change, we must have a Department equipped to do that, rather than one that views development through the ideological prism of national and commercial interest.
Trade and development are distinctly two different areas and they must not be forced together at the expense of the world’s most vulnerable people, particularly in the midst of a climate emergency. That is a growing concern for me and my party, and for NGOs at national and international level. In addition, there must be policy coherence on climate change across Government. We simply cannot have the situation that currently exists, whereby international climate finance spending to tackle climate change is undermined by support for the fossil fuel economy in developing countries by UK Export Finance, as has been mentioned several times in the debate. That will leave a legacy of dependency on fossil fuels and will disincentivise investment in renewables. Therefore, climate change should be an explicit strategic priority across all Departments. It is overdue and needs to be addressed now.
The sacking last week of Claire O’Neill, the former Minister of State at the Department for Business, Energy and Industrial Strategy, as president for COP26 has shown what a complete shambles the UK Government are in. Their approach to international climate change policy has been patchy at best. On Radio 4 this morning Claire O’Neill said that the Prime Minister has shown
“a huge lack of leadership and engagement”,
and that he
“doesn’t really understand climate change”,
leading the UK to be
“miles off globally from where we need to be”.
It is therefore little wonder that the Prime Minister is doing everything in his power to stop the Scottish Government being represented at COP26 in Glasgow later this year. To put it simply, the Prime Minister does not want to be upstaged and embarrassed by First Minister Nicola Sturgeon, who certainly does recognise the urgency and moral responsibility that we have with climate change, and who leads a Government whose work has been described by the UN climate change secretary as “exemplary”.
Putting it frankly, if the UK Government are not willing or able to properly prepare to host what is a major international event, perhaps they should speak with the First Minister for some blunt advice. As things stand, it is impossible to conclude anything other than that the UK Government are in a shambles and are playing politics with the global climate emergency. Therefore, if the UK Government are serious about alleviating the harm that climate change will bring to some of the world’s most vulnerable communities, they must follow the bold leadership of the Scottish Government and the recommendations of the International Development Committee and explicitly adopt the concept of climate justice to guide their climate spending. To do anything less is to reject our global commitments, our global partners and our global responsibility. While it is obvious to most that Brexit will undoubtedly make the UK smaller and poorer, not taking climate justice seriously will also make it both short and brutish.
The SNP has every reason to be proud of its record in championing climate justice abroad. More than 75% of the mentions of “climate justice” in the past decade in this Parliament have come from SNP MPs. I hope to see the same interest in the subject on the UK Government Benches in this Parliament. The simple fact is that we face a climate emergency that threatens us all. It will result in a less safe world, where ecological and demographic crises are unmanageable and where the development gains that have been made will be reversed. What good is our work on delivering aid for the world’s poorest and most vulnerable if it is undermined by disasters, disease, and displacement caused by climate change? It is now time to put climate justice at the forefront of aid spending and urgently do all we can to address the crisis.
It is a pleasure to serve under your chairship, Sir Charles. When I saw this debate on the list of upcoming Westminster Hall debates, I was keen to participate not only because it is such an important topic, but because it is being led by my constituency neighbour and hon. Friend the Member for Nottingham East (Nadia Whittome). It is a real privilege to respond for the Opposition.
My hon. Friend is quickly making her mark on the House, and I know she will be a strong voice for our community in Nottingham and for communities around the world who need people to stand up for them. I have known her for a number of years, and she has shared her voice, her power and her platform—be it for a popular or an unpopular cause—with people who are in need and who are without a voice or power. I know she will bring great credit to herself and our city in her time as an MP. We in Nottingham are proud that we will be the first city in this country to be carbon neutral, which was born out of community activism and campaigning. People took to the streets of Nottingham and pestered their elected leadership by being clear about what they wanted on this issue. Local leaders then reflected that by making it into policy, which is exactly how things should be.
Members of different parties have made a number of excellent contributions to the debate. I took double pleasure in the contribution from the hon. Member for Stafford (Theo Clarke), who has such a strong record from her professional experience. I know she will be a strong advocate for an independent, well-resourced DFID. My previous winding-up speech for the Opposition was in the dying embers of the last Parliament, and sitting about three chairs down from where she is sitting was her predecessor, Jeremy Lefroy, who is remembered fondly in this place for his contributions on a variety of issues, but especially on international development—there is clearly something in the water in Stafford. I take her point on the importance of the congruence of ODA policy and the Paris goals, and Britain’s climate obligations. I will return to that later, because we are at a point where they are starting to diverge.
I turn to the contribution from the hon. Member for Bath (Wera Hobhouse), who made an important point about our neighbours. Everyone is our neighbour. We talk about constituency neighbours, but our fates are so intrinsically linked these days. We are on the same planet currently hurtling headlong towards the same dreadful fate, so we have a real job of solidarity and responsibility to each other. I was very pleased to hear her talk about the importance of citizens’ assemblies, as other Members did. I will make a shameless plug as the chair of the all-party parliamentary group for deliberative democracy—all allies are welcome. For the climate emergency and many more issues, our democracies would be strengthened by bringing people in and having proper, evidence-based conversations on thorny topics.
The hon. Member for West Worcestershire (Harriett Baldwin) mentioned an extraordinary fact about the impact of gender and of all girls around the world getting 12 good years of education. My heart leapt when she brought gender into the discussion, as we ought to be feeding it into every debate in this place. Meeting only a basic decent standard would help us tackle climate inequalities and all sorts of inequalities around the world. She talked about enormous scales of improvements and carbon reductions, but they do not even factor in that, if we had a basic level of education for women and girls around the world and the freedoms that go with it, we would also have better leadership. The scope for making much greater inroads into other knotty climate challenges—in fact, into all our global challenges—would be enormous, too.
My hon. Friend the Member for Coventry South (Zarah Sultana) made a critical point that came up in the election when we talked to people on the doorstep, and to which we have to keep returning at all times: climate change is not a theoretical exercise, but is happening now. That not only behoves us to take immediate action, but reminds us that our actions are late. As such, they need to come with the scale and ambition that mean we are catching up. In that vein, the hon. Member for Brighton, Pavilion (Caroline Lucas) reminds us of our historic obligations—the duality of having both a historical legacy but also the greatest capacity for change.
We in Britain have a real responsibility to take global leadership. I suspect the Minister will start with that, because most, if not all, Government Ministers do so. We are in danger of believing our own hype that we are doing enough with our current emissions reductions. It is great to see the reductions, but they are not enough. We must take a real global lead by using our assets. As my hon. Friend the Member for Sheffield, Hallam (Olivia Blake) said, that is inconsistent with the decisions being taken on drilling, oil deals and fossil fuels, to which I will return shortly.
I will make a couple more points. We had the COP26 announcements today, but I want to talk about an announcement from two weeks ago, not least because I raised this issue at departmental questions last Wednesday and the Minister accused me of not having read the announcement. I thought it slightly unkind, not least because I was quoting verbatim from a written answer from the Minister for the Middle East and North Africa, the right hon. Member for South West Wiltshire (Dr Murrison).
Two weeks ago, the Prime Minister stood at a podium—he was probably waving his hands around—at the UK-Africa investment summit and made his flagship announcement on the climate emergency. He told 16 heads of state and the world’s media that the UK would stop investment and development assistance for coal mining and coal-fired power stations overseas. Garlands flowed from virtually all our newspapers, and there was a real sense that it was a seismic and totemic moment for such a promise to come from the Prime Minister. Looking at the announcement and what it really means, the reality is that UK aid funds have not been used to support coal since 2012, nor had UK Export Finance supported coal overseas since 2002. It was a re-announcement of something that had happened many years ago.
There is nothing new in spin—I confess that I have used a bit in the past—but this is too important an issue on which to equivocate. Although the Government were briefing one thing on climate and saying what wonderful progress was being made, they were actually very busy doing quite the opposite at the summit. The Government helped strike £2 billion-worth of energy deals, 90% of which were for fossil fuels, primarily oil and gas. The five fossil fuel deals include an investment of £26 million in gas assets in Tunisia by Anglo Tunisian Oil and Gas, and an investment of £1.2 billion in oil production in Kenya by Tullow.
The Government might well make a case for why they should support and broker investment in fossil fuels, and they ought to, clearly and honestly. The Minister has a platform, and I call on him to make it clear what was done at the summit and why it is important. It should be debated publicly—that is how it should work. The public ought to be able to make their own assessment of whether their leaders understand the greatest challenge of our time, and whether our actions match up with the rhetoric. When we stand at a podium and say we are doing one thing, and then quietly do another in the backrooms, it serves nobody. It certainly does not serve debate and will not tackle the existential challenge that we collectively face. As we go into COP26, I hope we can use the announcements, including today’s, to have proper and honest conversations about climate justice and the climate emergency.
I will make a point on climate justice and ask the Minister a few questions. I am grateful to my hon. Friend the Member for Nottingham East for raising this issue—we talk a lot about the climate emergency, and we ought to do so. It is the question of our time and leads to a technical question: what can we do to tackle the issue? What should we do to reduce carbon, and how can we save our planet for future generations? In answering that, we miss the challenge of fairness and justice, because it is seen as a lesser emergency. However, there is no true solution to the climate emergency unless it is just.
I will put on record five ways that the UK could adopt a full climate justice approach at COP26, and I would be interested in the Minister’s reflections on them. First, we need to provide climate finance for adaptation, resilience and mitigation, which should be targeted at the people who are worst affected. Will the Minister consider embedding the principles and standards of the ODA in climate finance spending, to ensure that it explicitly reaches those who are most marginalised?
Secondly, it is long overdue that the UK ends its investment, finance and aid funding for oil, gas and fossil fuels overseas. Will the Government immediately switch their support for energy overseas to renewable energies? In the light of what outgoing COP chair Claire O’Neill said, did the Prime Minister understand the other elements of his announcement on coal? Will the Minister make it clear how the announcement of divestment from coal, which has previously happened, is compatible with the deals that were struck?
Thirdly, as the demand for renewable energy expands, we cannot simply replicate previous injustices by allowing large corporations to extract raw materials for products such as solar panels on the back of cheap labour and conflict. Can the Minister assure us that people in the global south will not be exploited anew in the quest for new resources? What will we do differently to ensure that outcomes are more just in the future?
Fourthly, those affected will not get justice until the international community and the UK start to find ways to make amends for our role in historical emissions—that relates to the point made by the hon. Member for Brighton, Pavilion. The UK can start by recognising the need for financing for loss and damage, so will the Government consider doing so ahead of COP? Will the Minister ensure that the tab is picked up by the world’s worst polluters, and that it is not subsidised solely by British taxpayers, the vast majority of whom have not benefited and, indeed, are living with the impacts themselves—another hidden local injustice?
Fifthly, we urge the Government to take immediate action to cut the UK’s carbon emissions in the coming months before the conference so that we set an example for other wealthy nations. We should be pleased with the progress that has been made—I know what the Minister will say about our record in recent years—but we should have an honest conversation with people, because this is about not just our raw top-line emissions figures but our consumption figures, as the hon. Member for Brighton, Pavilion said. Let us have an honest, in-the-round conversation, and be really clear about what we are doing and the improvements we are making so that we can be global leaders.
It is time for us to step up as global leaders, not just on tackling the climate emergency so that future generations have a planet, but on ensuring that the outcomes are just and that we do not make the same unequal errors that we made in the past. I look forward to hearing the Minister’s views. I once again express my gratitude to my hon. Friend the Member for Nottingham East for securing and leading this important debate.
Minister, would you leave two minutes at the end, for the mover to wind up?
I am grateful to the hon. Member for Nottingham East (Nadia Whittome) for securing this important debate on climate justice. I am also grateful for the contributions from my hon. Friend the Member for Stafford (Theo Clarke), the hon. Member for Bath (Wera Hobhouse), my hon. Friend the Member for West Worcestershire (Harriett Baldwin), and the hon. Members for Coventry South (Zarah Sultana), for Brighton, Pavilion (Caroline Lucas), for Sheffield, Hallam (Olivia Blake), for Dundee West (Chris Law) and for Nottingham North (Alex Norris). It is particularly apt that every Back-Bench speaker has been female, given that my predecessor, my hon. Friend the Member for West Worcestershire, touched on the role that women can play in addressing the injustices of climate change.
At same time as severe drought across east Africa has left 15 million people in need of food aid, devastating fires have raged across Australia. These events serve to remind us again that no country is immune from the effects of climate change and environmental degradation. Here in the UK, the Met Office predicts that our summers will become hotter and drier and our winters increasingly warmer and wetter. As recently as November 2019, flooding across South Yorkshire, Derbyshire, Nottinghamshire, Lincolnshire and West Mercia, left more than 1,000 homes flooded and over 500 businesses impacted.
As all hon. Members said, on a cross-party basis, the science is clear: carbon levels in the atmosphere have reached their highest for 3 million years and climate extremes are already damaging prosperity, security and human safety globally. I am proud that the UK is at the forefront of action to tackle climate change, both domestically and internationally. In June 2019, we set a legally binding target to achieve net zero greenhouse gas emissions across the UK economy by 2050. We are the first major economy in the world to legislate for a net zero target, which will end the UK’s contribution to climate change.
We have already shown that, with our world-leading scientists, business leaders and innovators, it is possible to cut emissions while growing the economy. Between 1990 and 2017, we reduced our emissions by more than 40% while growing our economy by more than two thirds. We have decarbonised our economy faster than any other G20 country.
Not only is the Minister once again looking only at production emissions, not consumption emissions, he is refusing to accept the fact that, when talking about emissions reduction—sorry, it has gone out of my head. I am going to sit down and come back to it because it has just gone, but it will come back any second.
I can predict what the hon. Lady was going to say, and I am sure she can predict my answer.
It has come back to me. Does the Minister really think that it is possible to absolutely decouple growth from emissions reduction? His statement implies that he thinks that that absolute decoupling is possible, and that one can get to the point of separating growth from emissions growth. There is absolutely no evidence anywhere in the world that decoupling on the scale, speed and absoluteness that we need is possible. There is nothing to reassure us that it is possible to go on growing while bringing down our emissions.
The hon. Lady and I take a different approach. The Government believe that it is important to protect jobs and the economy. We can still grow the economy, but we can do it in a sustainable, balanced way. A lot of people, including the hon. Lady in the past, are guilty of suggesting that we have to stop all economic growth in order to achieve that, but we cannot. We have to harness the expertise of the private sector and the public sector. Everybody must work together to achieve what we want. That is what we have done: we have led the G20 over recent years by taking that balanced approach.
Since we set our net zero target, we have committed around £2 billion to support clean growth in a range of sectors, from transport to industry. In July, we published our green finance strategy, setting out our approach to catalysing the investment in green infrastructure, technologies and services that will be needed to deliver net zero. Earlier today, the Prime Minister announced that a ban on selling new petrol, diesel and hybrid cars in the UK will be brought forward from 2040 to 2035 at the latest, as my hon. Friend the Member for Stafford said.
On the point about vehicles, in my constituency of Vauxhall, which is the start of the congestion charge zone in London, young people in a number of schools are having to use masks because the air quality is so bad. Does the Minister agree that the lack of an emissions target in the Environment Bill means that it will not address the problem? Until the Government commit to that, it does not matter if we continue to change our vehicles. We need key action on this really important issue.
I agree: we need to go further and faster. Today’s announcement is encouraging. As a former Minister for the automotive sector, I remember working on the “Road to Zero” policy paper, which looked at how we can roll out electric vehicles across the UK even faster than we planned. We were always keen to review the evidence and be guided by the science on how we can move these things forward. I welcome the Prime Minister’s announcement today on that increasing ambition, but we always need to look at ways to go further. This debate is about climate justice, and air pollution disadvantages disproportionately the most disadvantaged communities in this country. We need to work together and be ambitious. We need to look at decarbonising the whole transport sector. We have been most successful so far in the energy sector, but transport still has a long way to go. I welcome the ambition today, but I agree with the hon. Lady that we need to go further and faster.
We need to invest more in our world-leading expertise, particularly in the north of England, where one in five of all the electric vehicles sold in Europe are made, the world’s biggest offshore wind turbines are being built, and carbon capture and storage is being pioneered. In addition, last week in the House of Commons we introduced the Environment Bill, which sets out how we plan to protect and improve the natural environment in the United Kingdom. The Bill will ensure that the environment is front and centre in our future policymaking. It will support the delivery of the most ambitious environmental programme of any country in the world. That landmark Bill will enhance wildlife, tackle air pollution, transform the way in which we manage our resources and waste, and improve the resilience of our water supplies. The speedy return of the Bill to Parliament following the general election underlines our commitment to tackling climate change and protecting and restoring our natural environment for future generations, as we maximise the opportunities created by leaving the European Union.
We are making net zero a reality as we raise our ambition at home. We will use the opportunity of COP26—officially launched by the Prime Minister earlier today—to demonstrate global leadership on climate action and bring the world together to achieve real progress. As has been said, it is often the poorest countries and people who are the worst affected and least prepared to deal with the impacts of climate change, environmental degradation and biodiversity loss. That triple threat threatens to undo decades of progress towards the sustainable development goals. The World Bank estimates that, unless serious and urgent action is taken, 100 million people are at risk of being pushed into poverty by climate change by 2030.
We are committed to supporting the most vulnerable countries adapt and build their resilience and to supporting low-carbon growth and development. We remain the only major economy in the world to put into law our commitment to meet the internationally agreed target of investing 0.7% of our national income on international development. That shows that we are an enterprising, outward-looking and truly global Britain that is fully engaged with the world.
We are committed to transforming the lives of the world’s poorest and most vulnerable people by giving them access to quality education and jobs, about which my predecessor, my hon. Friend the Member for West Worcestershire, spoke so eloquently, and by supporting millions in dealing with the impacts of climate change and environmental degradation while promoting Britain’s economic, security and foreign policy interests.
Since 2011, our international climate programmes have helped 57 million people cope with the effects of climate change; provided 26 million people with improved access to clean energy; and helped to reduce greenhouse gas emissions by 16 million tonnes, which is the equivalent of taking three million cars off the road for a year. In September, the Prime Minister committed to doubling our international climate finance to at least £11.6 billion over the next five years, which will make us one of the world’s leading providers of climate finance.
That funding really works. In 1991, a category 6 cyclone hit Bangladesh, killing 139,000 people. In 2007, an even stronger cyclone killed 4,000. That is still far too many deaths, but the incredible 97% reduction was achieved by Bangladesh’s investment in better disaster preparedness, with support from international donors.
UK Government research into drought-resistant wheat varieties has delivered benefits more than 100 times greater than costs, delivering an annual economic benefit of between $2.2 billion and $3.1 billion. Our forestry programmes have supported Indonesia in introducing regulatory changes, including setting up independent monitoring and improving law enforcement. Today, 100% of timber exports are sourced from independently audited factories and forests, and over 20.3 million hectares of forest are independently certified. In Ethiopia, our productive safety net programme helped to prevent 4.2 million people from going hungry when the country experienced severe drought. Our programmes have helped smallholder farmers in Burkina Faso deal with increased rainfall variability and higher temperatures; have assisted with the production of Kenya’s national climate change action plan; developed early warning systems to reduce the impacts of disasters in Chad; improved flood defences in South Sudan; and delivered solar power to clinics across Uganda .
Addressing the contribution from the hon. Member for Dundee West (Chris Law) gives me the opportunity to acknowledge the efforts of the Scottish Government, who have also recognised that the poor and vulnerable at home and overseas are the first to be affected by climate change and will suffer the worst. The Scottish Government’s work—particularly in Malawi, which he mentioned—continues to be cited by the Department for International Development as a really good example. I take exception, however, to the hon. Gentleman’s claim that DFID’s expertise has been reduced in this area. We have made a number of investments, and I hope that he welcomes this Government’s appointment of Lord Goldsmith as a joint Minister for the Department for Environment, Food and Rural Affairs and DFID, to bring expertise to both Departments and determine how we can better collaborate to tackle the issue.
Turning to the UK-Africa investment summit, which was also mentioned, we may not agree, but energy is essential to economic growth and poverty reduction. Currently, 840 million people have no access to electricity, and 2.9 billion have no access to clean cooking. Our priority is to help developing countries to establish a secure and sustainable energy supply while supporting climate and environmental objectives. Increasing our overseas development support for renewable energy has been the top priority. Since 2011, UK aid has provided more than 26 million people with improved access to clean energy and installed 1,600 MW in clean energy capacity.
We recognise that countries will continue to need a mix of energy sources as part of a transition to a low-carbon sustainable economy, including renewable energy and lower-carbon fossil fuels such as natural gas, which produces significantly less carbon than coal or other commonly used fuels. Our approach to fossil fuels is therefore to support them where there is a clear development need and as part of a transition to low-carbon economies. When assessing new support, we will ensure that assistance does not undermine the ambitions of a country’s nationally determined contributions, and that an appropriate carbon price is used in the appraisal of the programme.
We have about 30 years to get to net zero. How long does it take to develop new fossil fuel industries and then see them as a transition? They will just remain in place even though we have to reach net zero. Does the Minister not recognise that we have run out of time for a proper transition and have to get to net zero as soon as possible?
We have to get to net zero as soon as possible, but we have to do so in a balanced and proportionate way. To give an example, the oil and gas sector contribution to the Scottish economy is £16.2 billion in gross value added, and some 105,000 jobs in Scotland are dependent on it. It would be slightly hypocritical of us to continue employing so many people in the oil and gas sector in the UK—we see it as part of our energy transition, using gas in particular to decarbonise our economy—if we were to say that other countries around the world could not use gas as a low-carbon alternative to the dirtier fossil that they use, particularly coal. We take a balanced approach on those matters, but I know that there will be disagreement across the House.
I was pleased that in addition to the £6.5 billion-worth of deals that were announced at the UK-Africa investment summit, we announced £1.5 billion of new DFID programmes to support sustainable growth across Africa. We will continue to work in partnership with African countries as part of our broader strategy for Africa, which has seen a significant uplift in our resources on the continent for the first time in decades.
Successfully tackling climate change will require action from the whole of society: Governments, business, communities and each of us in our individual choices. We know that the impacts of climate change will not be borne equally between rich and poor, women and men, and older and younger generations. At the start of her speech, the hon. Member for Nottingham East said that climate justice means
“addressing the climate crisis in a way that is fair and equitable.”
I agree, and that is fundamental to the Government’s approach.
As an international community, we must renew our efforts to achieve the sustainable development goals and fulfil our commitment to leave no one behind. The UK will not only play our part in that domestically, we will provide global leadership, as we invite the world to Glasgow in November to agree on and increase the urgent action that we need to take to protect our planet.
I thank the Minister for his response and every hon. Member who attended for their contribution. I am reassured by the widespread recognition that climate change does not impact everyone and every nation equally. It crosses borders and there is an urgent need to invest in infrastructure and adaptation, and to decarbonise. I was particularly pleased that the hon. Member for Brighton, Pavilion (Caroline Lucas) and others made the point that 2050 is not good enough as a target for decarbonisation. I was also pleased to hear examples of local authorities across the country leading the way to reach net zero, particularly in our own city of Nottingham, which is on track to be the first carbon-neutral city in the UK.
Whoever is in government or opposition, the climate emergency cannot wait. I look forward to working with Members across the House to hold the Government to account on their pledges. In that vein, I will follow up with the Minister and I hope that he will respond in more detail to the questions that I have raised, particularly about whether the Government will rule out carbon offsetting, why the climate sub-committee has not yet met and when it will do so, and whether he is prepared to give a substantive update briefing on COP26 preparations in the light of the serious concerns that have been raised.
Question put and agreed to.
That this House has considered climate justice.
Local Housing Allowance: Homeless Young People
[Mr Philip Hollobone in the Chair]
I beg to move,
That this House has considered local housing allowance rates for homeless young people.
It is a pleasure to serve under your chairship, Mr Hollobone.
Clearly, we have a severe homelessness crisis. The number of people sleeping rough on the streets of England has increased by a huge 165% since 2010, and 103,000 young people were homeless or at risk in 2017-18. In my own city of Brighton and Hove, the scandal and tragedy of homelessness is acute. Vulnerable young people are being let down, left to sleep on sofas, in hostels and on our pavements, cold, frightened and desperately unsafe.
The Minister himself has said, in answers to questions in the House, that the causes of homelessness are numerous, varied and complex. He is right. In the short time we have today, I will address the specific problems caused to vulnerable young people by the significant gap between the cost of renting in the private sector and the local housing allowance rates provided to the young people who need support.
Private renting is expensive, but because there is not enough social housing, young people are forced into the private rented sector as the only alternative to homelessness. The House of Commons Library points to evidence that in many areas, especially areas of high housing demand such as Brighton and Hove, there is a growing gap between the lowest private rents and the amount of local housing allowance. Young people in Brighton and Hove have a particularly hard time because the amount of LHA is calculated by lumping our city in with other towns in the locality where the cost of housing is much lower. The amount of housing support is therefore artificially depressed, leaving young people in an even more desperate position.
Research by the Chartered Institute of Housing illustrates the dire situation for young people. In Brighton and Hove, 30% of properties should be available at or below the LHA rate, yet LHA is so much lower than local rents that only 10% of shared properties and only 5% of one-bedroom properties are affordable. Evidence is also provided by the National Audit Office, which in 2017 concluded that housing benefit changes were contributing to an increase in homelessness.
As hon. Members know, the Government have taken some action. This April, there will be a one-off, 1.7% increase in LHA rates. That sounds positive until we look at what that means for the figures. In Brighton, young people will receive only £5 extra a month. That is a kick in the teeth for homeless young people who are already more than £140 a month short of the average rent for a room in a shared house, as I will explain. Furthermore, because the increase is a percentage, it locks in the freeze of the past four years.
To illustrate the point, the charity Centrepoint analysed the new LHA rates for 2020-21 alongside the average rental costs for the 247 local authorities where rental data are available. It found that, from April, a room in a shared house would be affordable only in three of those 247 local authority areas for those in receipt of the shared accommodation rate. Rightly and urgently, homelessness charities are calling for the local housing allowance, including the shared accommodation rate, to be set at the 30th percentile of local rents, as it was until 2012. I hope that the Minister will push the Treasury for the restoration of that link to rents.
My more specific purpose in securing today’s debate, however, is to urge the Minister to champion two other actions that will cost the Treasury relatively little, but will have a massive impact on two groups of extremely vulnerable young people. The first group to need the Minister’s help is homeless young people under the age of 25 who are ready to move on, but who are trapped in hostels because they cannot find anywhere to rent on the shared accommodation rate. In effect, therefore, they are left locked into emergency accommodation, unable to find a safe place to live and unable to move on. Moreover, in the process, they prevent those in urgent need from finding shelter at the emergency accommodation.
Young people under the age of 25 make up fully 44% of those living in supported accommodation. They end up trapped in hostels, because our welfare system is rife with age discrimination. If I am over the age of 25 and previously spent three months in a hostel, I will be given a higher local housing allowance to help me find a place to live, but if I am under 25 and in exactly the same situation, I still receive the lowest rate. Young people entering a homeless hostel at the age of 18, therefore, will have to wait as long as seven years before they benefit from the rate that would help them to move forward.
Why have the Government turned their back on vulnerable young people who so clearly need support to find a home? Young people experiencing homelessness cannot rely on the bank of mum and dad and cannot move back into the family home to save up, yet they receive the lowest minimum wage and the lowest benefit rate.
In 2018, the charity Depaul UK looked at the shared rooms available in 40 local authority areas in England where official statistics showed that a total of 225 young people were sleeping rough on a single night. Across those 40 areas, only 57 rooms were found to be available for young people at or below the shared accommodation rate. Nine of those 225 young people sleeping rough were in Brighton and Hove, but the research found literally no rooms in our city that were available within the shared accommodation rate for young people claiming benefits.
In Brighton and Hove, the shared accommodation rate for homeless young people is just £360 per month. If we search on Rightmove for shared room rooms for that amount, I promise that all we get coming up on the website are parking spaces or garages. That is shameful. The average rent of a room in a shared house is £507 a month. That is a shortfall of more than £141 a month, leaving homeless under-25s unable to move out of a hostel and find somewhere safe to live. In the Prime Minister’s local authority, from April 2020 the monthly shortfall will be more than £236 a month. In the Minister’s own area of Colchester, the shortfall, as I am sure he knows, will be £153 for a homeless young person.
The Minister may ask why young homeless people need the exemption from the shared accommodation rate when the Government have introduced some measures intended to mitigate the impacts of LHA restrictions. For example, in answer to a recent written question, the Minister replied:
“For individuals who may require more support and whose circumstances may make it difficult for them to share accommodation, Discretionary Housing Payments are available.”
I urge the Minister, however, to consider the fact that discretionary housing payments, or DHPs, are not a sustainable solution. They are supposed to be a temporary measure until a household finds more affordable accommodation. Yet for homeless young people, affordable accommodation simply does not exist, due to the reduced rate of housing benefit that they receive.
Moreover, in order to access DHPs, young people need to approach their council or MP for support in applying, and many homeless young people at crisis point may simply not have the know-how or capacity to do that. Furthermore, the state already has the information needed to make a fair decision on providing extra support without forcing someone in that position to apply for discretionary and temporary help—the information is that being homeless and living in a hostel for three months is, in itself, qualification enough for needing more support, whatever age someone is.
Centrepoint, which works daily with young people aged 16 to 24 in that position, estimates that it would cost just £3.68 million a year for the Treasury to exempt such young people from the shared accommodation rate, giving them the higher one-bedroom rate and a chance to move on. That does not even take account of the savings that would accrue from providing stability—the cost of emergency accommodation is high, as is the cost to the state and the young person of the consequences of homelessness.
I appreciate that Ministers accept the logic of providing an exemption to the SAR to people in need, because they are able to find such funding for over-25s who are experiencing homelessness. All I am asking for today is that they will find it in their hearts and budgets to help younger homeless people too.
My second specific ask of the Minister relates to that group of young people who have left care. Care leavers deserve somewhere safe to call home. Many have experienced unspeakable trauma, and surely that is the least we can provide. Again, it is shocking that the local housing allowance received by care leavers drops on their 22nd birthday, putting them at risk of eviction and homelessness. When I say “drops”, I mean it literally plummets. In Brighton and Hove, there are about 300 care leavers aged between 17 and 21. On a care leaver’s 22nd birthday, what does the state do? It takes away £330 a month. In the Prime Minister’s area, a care leaver surviving in the private sector loses a whopping £437 a month. What a birthday gift to vulnerable young people who are on their own, having faced unimaginable trauma and difficulty.
The Government’s rationale for creating such instability, difficulty and risk for 22-year-old care leavers is not at all clear. Perhaps the Minister will explain. The policy seems strongly at odds with previous Government statements. For example, in 2016, the Government rightly accepted the moral obligation to provide care leavers with the support they need, stating:
“The government is passionate about improving the lives and life chances of care leavers. Young people leaving care constitute one of the most vulnerable groups in our society, and both government and wider society have a moral obligation to give them the support they need as they make the transition to adulthood and independent living.”
I could not agree more, and I urge the Minister simply to extend that understanding until a care leaver is 25.
Homelessness charities estimate that the number of care leavers aged 22 to 24 affected by the reduction in housing support is relatively small. The cost of extending their exemption from the low shared accommodation rate until the age of 25 would be in the region of £6 million. As with the previous ask for hostel leavers, it would save the Government money overall by reducing homelessness, distress and all the personal and financial costs associated with crisis management.
To try to demonstrate the genuine need for support for care leavers until the age of 25, I would like to tell the Minister about a case from my local area. A girl in both foster care and residential care was placed with foster carers from the age of 14; as a result, she built a solid relationship with the family she was finally placed with. She has learning difficulties, so any changes to her environment or living circumstances are destabilising. To her great credit, she found a job and established a good routine in the local area, and she maintained a tenancy on a bedsit. She was able to cover the rent between the LHA one-bed rate and her weekly wage. Since turning 22, she is in receipt of the lower shared room rate of local housing allowance. That means she does not have enough to cover the cost of rent each week from earnings and benefits. She is now at risk of homelessness.
It would cost just £3.7 million a year to give vulnerable homeless young people the chance to move on, and just £6 million to continue supporting care leavers with their housing costs until they are 25. That support would save the state money overall, because stable, supported young people could fulfil their potential rather than suffer in chaos and danger. Less than £10 million to make such a huge difference to young people’s lives is not a lot to ask. Will the Minister urgently meet with the homelessness charities and MPs to work on these specific asks ahead of the Budget—the critical moment? Will he use his influence with the Chancellor to provide that relatively small amount that would make a huge difference to young people in my constituency and right across the country?
It is a pleasure to serve under your chairmanship, Mr Hollobone, and I thank the hon. Member for Brighton, Pavilion (Caroline Lucas) for securing this important debate. Since my election in 2015, I have been passionate about tackling homelessness. Before my appointment as a Minister, I served as co-chair of the all-party parliamentary group on ending homelessness, where I engaged and built relationships with many brilliant charities, a number of which the hon. Lady mentioned, to work with them to end homelessness and rough sleeping.
Since my appointment as Minister, I have worked and continue to work closely with a number of those charities and other organisations to help to inform my work and that of my Department, to ensure that the Department for Work and Pensions does all we can to support those who are at risk of homelessness and that we are getting housing benefit right to provide the support that people need. As a Department we support the wider Government aims and ambitions to end rough sleeping and tackle wider homelessness.
My role as the Minister for welfare delivery has enabled me to go to all parts of the country, and subject to reappointment I look forward to continuing to do so. I have visited a number of charities and organisations around our great country that support those who have experience of homelessness and rough sleeping. That has enabled me to get a better understanding of those issues. I include among those organisations a number of arm’s length management organisations and housing associations that have a role to play.
The hon. Lady will no doubt recognise that this is not an issue that the Department for Work and Pensions can tackle alone. I am working with my counterparts in several Government Departments as part of cross-Government efforts to tackle this issue. Sadly, these debates are always far too short; I have no doubt that the hon. Lady and I could discuss this and associated issues at great length. We could probably spend most of the day talking about the issues she raised: rough sleeping and the broad rental market area in Brighton, local housing allowance, Centrepoint’s analysis and young people under 25 with experience of homelessness, as well, of course, as care leavers, not to mention the point she makes about social housing. I would very much welcome her at the Department to chat through some of those issues at greater length with officials, as appropriate.
I will try to cover as many of the issues as I can in the time left. First, we have to address the elephant in the room, which is the root cause of this issue: in parts of our country, we have massive supply and demand issues. The hon. Lady’s constituency is an example of that; my own constituency is another. As a result, although there are parts of the country where the ambition was to have the local housing allowance rates set at the 30th percentile, there are many parts of the country where the local housing allowance is sub-5%. That represents an issue. The root cause of that—my officials will not like me for saying it—is that successive Governments have failed to build enough houses, in particular affordable housing and homes for social rent. That is something we need to look at.
I congratulate the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing this important debate. On affordable housing, does the Minister share my concern about the research by the charity Crisis, which showed that cuts to housing benefit mean that in 94% of areas across the country, only one in five private-rented properties are affordable to young single people? Obviously, we need to do much more to tackle that.
The hon. Lady is partly right; the solution is not just about local housing allowance. We can continue to pump money into housing benefit, which unfortunately in many parts of the country lines the pockets of private rented sector landlords. But if we are to tackle this in the long term, it is about affordable housing and a mixture of tenure between ownership, affordable housing, which is up to 80% of market rent, and homes for social rent, which is significantly lower. It is about addressing the supply issue as well as the demand issue, to ensure that we tackle the problem for the medium to long term. That is why the Department and I are working closely with the Ministry of Housing, Communities and Local Government, not to mention the other Government Departments involved. Between us, we hold the key—we hold the housing benefit bill, but they have a lot of the levers to address the supply side.
I commend the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing this debate. The Minister will be well aware that only something like 6,480 social rent properties were built in 2018. We have a huge undersupply, as the Minister highlights. The other day, Shelter told me that people are finding themselves under so much financial pressure that they cannot meet the rent because of the low payment being given to them. People are moving from a two-bedroom to a one-bedroom and are doubling up in the properties. That is putting more pressure on single occupancy and double occupancy.
There is no question that the Government are committed to increasing the supply of social housing. Through the affordable homes programme to March 2022, we will deliver 250,000 new homes on a wide range of tenure. We will renew the affordable homes programme, building hundreds of thousands of new homes.
It is important to stress that, since 2010, we have delivered more than 464,000 new affordable homes, including 331,800 affordable homes for rent. As I said, I am working very closely with my counterparts at MHCLG on the interaction between housing supply and housing benefit. Until that supply is addressed, local housing allowance rates will continue to play a part. That is why we have increased LHA by 1.7%, in line with CPI. Of course, the ambition is to go further, and I personally would like to see it go back up to the 30th percentile. That comes, as I think I have said in response to written parliamentary questions, to the tune of about £1 billion. It is not a cheap intervention, so we have to address the supply issue alongside it.
The hon. Member for Brighton, Pavilion rightly raised the broad rental market area in Brighton. That is not an easy issue to address. There are 192 broad rental market areas and 960 local housing allowance rates, so looking at them is a considerable piece of work. I am doing that work, and it is important that we do so, but it cannot be done in one financial year. Unfortunately, since there are so many of these issues in all parts of the country, there are unintended consequences. However we draw the boundaries, there are winners and losers. I understand that there is an issue in Brighton at the moment. The same is true of Blackpool and, close to my constituency in Essex, of Jaywick, Frinton and Clacton. These issues do arise. I encourage the hon. Lady to write to me with the specifics—alternatively, I would be very happy to visit—so we can look at them in more detail.
I work very closely with Centrepoint, which is a wonderful charity. I have been on several visits and I intend to do far more. We have already done a considerable piece of work in this area. I can touch on the Government’s action on homelessness and local housing allowance, although I probably do not have enough time to go into the detail I would like. There have been considerable amelioration measures, such as discretionary housing payments, which we are increasing by a further £40 million this financial year to help local authorities support people where local housing allowance is not sufficient. Over the past three years we have also had targeted affordability funding; as I understand it, in the last financial year, that increased about 45% of shared accommodation rates by 3%. Nevertheless, I would like us to go further, and I think the steps we have taken to increase rates by CPI will make a difference.
The hon. Lady referred specifically to care leavers. We know that people leaving the care system can be particularly at risk of homelessness. We have provided £3.2 million per annum to 47 local authorities with the highest number of care leavers at risk of homelessness. That has led to a number of innovative ideas to support those leaving the care system into safe, secure and long-term housing. However, I understand the case put by Centrepoint, the hon. Lady and others about the rate. She suggested two items that would cost a little under £10 million. That is still a significant sum and would require Treasury approval. She may have got the impression that she is pushing against a half-open door. I am very sympathetic to that view, including in relation to those who have experience of homelessness. She asked me to commit to meeting charities and Members with specific interests in this area. I would of course be delighted to. Actually, I think a number of those meetings are already in train, but I will of course continue to do that.
On the shared accommodation rate, our approach is based broadly on the principle that young single people in the private rented sector should have their housing benefit limited to the rate appropriate for shared accommodation, but the hon. Lady rightly made the point that there are exceptional circumstances and there need to be exceptions to policy. We already have a number of exceptions, as she pointed out, but where there are opportunities for us to go further and there is a clear evidence base for doing so, of course we will look at that.
An obvious example of other interventions is the Homelessness Reduction Act 2017, which has enabled us to make great strides in the support that we can give to young people in particular. Many of them would not have been eligible under the previous system of priority need but now will be eligible on the basis of the duty to refer. The Act is making a huge difference, and I have no doubt that the hon. Lady knows that from speaking to her local authority, as I do to mine. We must ensure, through the MHCLG, that it is suitably resourced, but we know it is making a difference, including to young people. Importantly, the Act also places a duty on public bodies, including children’s services, youth offending institutions and youth offending teams, to ensure better partnership working. That is really important for ensuring that young people get the wraparound support they need.
The MHCLG is the lead on broader Government action on homelessness, but we very much support its efforts. The Government are committed to tackling homelessness and rough sleeping. As the hon. Lady will know, we committed in our manifesto to end rough sleeping by the end of this Parliament and to fully enforce the Homelessness Reduction Act.
There are a number of issues, including local housing allowance rates, that I would love to cover in more depth. As the hon. Lady rightly pointed out, we have an opportunity ahead of the fiscal event—the Budget—on 11 March to look at housing in the round. We are having conversations with the MHCLG and the Treasury to see how we can look at supply and the way that investment in supply—in particular supply of affordable homes and homes for social rent—would interact with our housing benefit bill. It pains me that we spend around 30% of our housing benefit bill on the private rented sector. It pains me even more that, because of LHA rates and other demand and supply issues, a percentage of that—I do not have a figure, but there is research to be done there—is spent on housing that I do not believe is of a standard that the taxpayer and the Government should fund or invest in.
In conclusion, I would be very happy indeed to work with the hon. Lady—
Will the Minister give way?
I really appreciate the Minister’s response, and I would very much like to take him up on his offer of meeting him and his officials. I know that he is broadly on side. He pointed to supply, which is very important—we need more affordable housing, particularly for rent—but we also need immediate action. As he knows, discretionary payments are not a sustainable solution. They are for moments of crisis; they are not for an ongoing payment situation. Right now, there are not any mitigating circumstances for the particular groups that I and Centrepoint have identified, so I urge him again to take up those cases.
I thank the hon. Lady for that intervention. As a Department, we set no timeframe or parameters for how long discretionary housing payments are available. We leave that up to local authorities. However, I very much take her point, and I thank her for the constructive way in which she has put the case for those two groups. There is a strong argument there, and I will have to take it away and work it up with officials, including by having conversations with Centrepoint and others.
We are committed to providing a strong safety net for those who need it. That is why we continue to spend more than £95 billion a year on working-age benefits, including around £23 billion to help people with their housing costs. We are meeting our manifesto commitment to end the benefit freeze and the freeze on local housing allowance rates. I hope the hon. Lady has got a sense of my passion on this issue and my desire to go further. That is why, as I have said a couple of times, work is under way between my Department and the MHCLG. Where there are opportunities to bring in Members from across the House and charities—charities have some really good ideas and quite reasonable requests of Government in this area, with strong cases—I am very happy to work with them.
Question put and agreed to.
Lloyds, HBOS and the Cranston Review
I beg to move,
That this House has considered Lloyds, HBOS and the Cranston review.
It is a pleasure to see you in the Chair, Mr Hollobone. I think this is the second time I have spoken under your chairmanship about banking matters. This story is at least as shocking as the last one we discussed.
The story starts back in 2007, when Nikki and Paul Turner, who were then customers of HBOS, told the bank of a huge fraud in its organisation that was affecting them and many other customers. The bank denied all knowledge of the fraud. It sought to suppress the evidence that Nikki and Paul Turner had and to ensure they could not speak out by trying on 22 occasions to repossess their home. Without the Turners, I do not think we would be here today, but they found out, and their determination has brought these matters to this point. The fraud was finally proven in court in 2017, 10 years later—imagine those 10 years of denial.
Despite the fraud happening within HBOS, which was part of Lloyds Banking Group by that point, we were willing and happy for Lloyds to take on its own customer review and compensation scheme for those victims, many of whom had been denied any justice and had it denied to them that any fraud was going on whatsoever. Lloyds set up the Lloyds Bank customer review, also known as the Griggs review because it was headed by Professor Griggs, who was appointed by Lloyds to undertake compensation payments to victims.
The Turners were compensated, but they decided to help other people navigate the Griggs process. They formed an organisation called the SME Alliance, which has been proactive in making sure that people get justice. Not only did they warn Lloyds about the initial fraud; they started to warn Lloyds about how unfair the Griggs review was and how partial the process was to the interests of the bank. In fact, they went as far as commissioning their own review of the review, undertaken by Jonathan Laidlaw in 2018-19, which endorsed the Turners’ findings and said that the process was truly unfair and partial to the interests of the bank
Throughout the process, others were warning Lloyds that the Griggs review and the scheme was completely unfair. Following all those calls and the Laidlaw review, the Minister kindly supported those calls and commissioned a review, carried out by Sir Ross Cranston.
We have had many reviews and redress schemes in different forms over the past eight years. Does the hon. Gentleman agree that to provide comfort to people, the methodology of those reviews should be independently tested against the benchmarks that Sir Ross set out in his report?
The hon. Member is absolutely right. The biggest learning we have is that the whole process must be independent. It simply cannot be fair to have any review carried out within the bank’s boundaries that provides compensation for victims. It must be independent and independently verified. I very much appreciate her work and support on the all-party parliamentary group on fair business banking.
The all-party group, which I co-chair, made many calls saying that the process simply was not right. The Minister supported those calls, and we commissioned a review. Andrew Bailey, head of the Financial Conduct Authority , and the future Governor of the Bank of England, engaged in constructive collaboration with us and made an excellent choice of reviewer in Sir Ross Cranston, who has done a tremendous job. Most importantly, he got every stakeholder round the table before he properly commenced the review. He consulted us on many occasions, and we had great confidence in his ability to assess properly whether the review was fair.
Sir Ross’s findings were shocking—that is, shocking to anyone not familiar with the process. Anybody familiar with it, whether a victim or victims’ support group, knew exactly what he would say. We should be very grateful to him. It is a long report, but its essence is that: the Griggs review did not deliver fair or reasonable offers of compensation; it was not open or transparent; it had serious shortcomings; it took too adversarial an approach to assessing consequential loss; and, crucially, its design meant that it could never deliver fair and reasonable outcomes. Those were his findings.
We are pleased that the chief executive of Lloyds, António Horta-Osório, has written to us and the victims, and he met us. He has apologised unreservedly for the bank’s conduct in the review and committed himself personally to getting this right. It should not have been a surprise to anyone—he had been warned on many occasions that the process was flawed. Nobody should be surprised about the result if we allow a business to mark its own homework—it shows a fatal misunderstanding of how businesses operate. I speak as a businessperson who has been in business for 28 years and is still in business today. I do not think I should be allowed to regulate my business or regulate where I have customer complaints; independent oversight is critical.
Milton Friedman, the leading economist, once said that the social responsibility of business is
“simply to increase its profit”.
Warren Buffett recently said that the Government have to play their part in modifying the market system. We cannot simply leave this stuff to business; we must ensure independent oversight and fair regulation. Business is not afraid of regulation; it just wants stable, fair regulation, not over-regulation.
A bank found guilty in court of defrauding its own customers, which denied that fraud and even disgracefully mistreated whistleblower Sally Masterton in her efforts to keep the fraud out of the public eye, is allowed to compensate its victims, through its own process. The lessons we learn from the process are not just about how to compensate victims fairly and give them justice for their mistreatment but about how the regulators have dealt with it. We undermine our system of free market capitalism if we let these powerful and dominant capitalists go unchecked.
I will briefly list some of the representations that the all-party group has made over the years. My predecessor as chair wrote in February 2017 to António Horta-Osório about Lloyds’s plan to take forward the review. He said that there were unacceptable exclusion clauses, the process would be poor when it came to the consequential loss and it was critical that redress was transparent, balanced and legally binding. That was three years ago. We recommended the use of an independent process through the Chartered Institute of Arbitrators which would have been much fairer.
We did not leave it there. Over the past three years, I have had many meetings with the senior management team at Lloyds—I recently met the chief executive—including Lord Blackwell, the chair of Lloyds, as has the director of policy for the all-party group, Heather Buchanan. There has been much correspondence between us. In July 2018, we wrote again to Lloyds and said that the victims were still being treated with contempt. The reply from Lloyds—from Adrian White, the chief operating officer—said:
“We strongly believe that the offers made are both fair and reasonable.”
That demonstrates the institutional arrogance of Lloyds and the wider sector, as people were constantly pointing out that the review was not fair. Any protests about the process were simply ignored. For us, it is not that the bank did not know about it; it simply chose to ignore us and many others.
The key is where we go now. Perhaps this is not the first step, but it is incredibly important that the FCA undertakes an investigation under the senior managers regime on both the Griggs review and the people responsible for that review within Lloyds. Lloyds must take responsibility for the review and other things connected to the whole saga, including the disgraceful treatment of Sally Masterton, the whistleblower, who was mistreated for five years. She was discredited by Lloyds to the FCA, for which she was finally compensated in 2018, yet nobody has been held to account for the mistreatment of a whistleblower pointing out some of these very issues.
Another thing we will need to look at is the people who are not part of Lloyds but are connected to the review. The legal advisers Herbert Smith Freehills are clear that they misled the Financial Conduct Authority about Sally Masterton, the whistleblower. They advised Lloyds on the establishment of the Griggs review, on its operation and on some legal points incorrectly, according to Sir Ross Cranston. It is unthinkable that Herbert Smith Freehills should have any influence on the future redress scheme. That must be an absolute minimum; it cannot happen as we go forward. They should also be the subject of an investigation by the Solicitors Regulation Authority.
The Cranston review offers us a crucial opportunity; it is a watershed moment. It is not just about Lloyds but about the wider banking sector.
Is the hon. Gentleman aware that a freedom of information request to the Financial Ombudsman Service showed that, between 2015 and 2018, complaints about Clydesdale Bank, now Virgin Money, were disproportionately high in comparison with their larger competitors? There were 404 complaints in total and, worryingly, the percentage of those upheld was only 13%. Does he agree that it is time for the chief executive officer of Virgin Money, as a self-professed challenger to the status quo, to step up and make sure that these legacy cases are dealt with?
I absolutely agree with the hon. Lady. This is not just about Lloyds. A number of independent reviews have taken place, but they have been undertaken by the relevant banks. That simply cannot be right, in terms of justice for victims or their feeling that justice has been done. Justice being seen to be done is a basic principle that, it seems, the banking sector does not have to adhere to.
When the APPG was initially talking about future redress, it proposed a financial services tribunal, similar to an employment tribunal, where there would be no adverse costs, so a claim could be taken forward more easily. That would help to reduce the power imbalance between banks and businesses. A comment that came back from one of those commissioning the review on behalf of UK Finance, the banking representative organisation, was that the courts were not the right place for banking disputes to be settled. Well, they are the right place for the rest of us to settle disputes—that is what our system is built upon.
We need impartial, independent processes. I will talk about the right process for that moving forward, because there is an obvious new alternative approach we can take.
I pay tribute to the hon. Gentleman for the way in which he has championed justice for those wronged by Lloyds. He is right to describe this case as one of the worst examples of corporate abuse that many of us in this House can remember. Would he be attracted by the consumer ombudsman model? In this case it was not consumers who were primarily affected, but consumer ombudsmen in other countries—crucially, those with class action powers—can bring actions against big businesses that are guilty of the type of behaviour that the hon. Gentleman describes, on behalf of both consumers and small businesses. Would that not be a powerful addition to the regulatory field and help to hold big banks to justice?
The hon. Gentleman makes an interesting point, although that is not a model I am familiar with. Class actions are definitely opportunities that are not well exploited the UK because of our legal system. I would be keen to talk to him further about that approach.
Within our system we have the Financial Ombudsman Service, which does not necessarily have the best reputation, although I know the hon. Gentleman is talking about something different. It is a problem that whoever is overseeing cases has to be competent and have the right understanding, because there are complex cases that take into account issues around complicated banking products. We have to ensure that the calibre of arbitration or adjudication is at the right level—I will say more about that shortly. We certainly need reform. Moving forward, we think we have a good solution, but we need to continue to improve on that.
This is not just about Lloyds. There are a number of other redress schemes for banking malpractice and mistreatment that have already been conducted by relevant banks. Banks were the principal arbiters of deciding how much compensation people were allowed to have relating to the interest rate swaps schemes and interest rate hedging products, many of which had a devastating effect on businesses. The debates that we have had about the Royal Bank of Scotland, over the past months and years, have raised similar problems about the mistreatment of small businesses. There are problems with their review process and with others, as other hon. Members have said.
I will describe cases that put that into perspective. The first person to write to me about a business banking dispute was Jon Welsby from Filey, when I first became a Member of Parliament. He showed me a huge file of evidence about his business, but the dispute came down to quite a simple problem. He had been sold a swap by Lloyds bank—they were sold by many different banks—that had had a devastating effect on the interest rates he had to pay. The amount he had to pay rose from about £5,000 a month to £17,000—perversely, as interest rates fell, as that was the way swaps worked. He was given direct losses, but he was not assessed as being due any consequential losses by the bank-led review. He was able to gather together the resources to take his claim to court. It was a £10 million claim, although I am not clear exactly how much he received, as he settled out of court. He was able to settle the claim, whereas most people cannot get the money together to take their claim to court. He had had his claim assessed by the bank and was not happy with it, but because he had the money to get to court, it was settled for a much higher figure. It cannot be right that the only people accessing justice are those with the wherewithal to get to court. Given that imbalance of power, people would need millions of pounds to take a bank to court. It is simply unfair.
The constituent of my hon. Friend the Member for Beckenham (Bob Stewart), Dean D’Eye, came to us about the RBS Global Restructuring Group scheme. He had a property development business and loans to the value of around 60%. He never missed a payment to RBS. He was sold a swap, which damaged his business, but the key moment came when money from a property sale he had made, to add cash flow to his current account, was taken away by the bank and used to reduce debt. According to Mr D’Eye, that broke the agreement and had a devastating impact on his business.
It did not just affect Dean D’Eye but it deeply affected his father, who was almost bankrupted and lost his home.
Absolutely, and we see that time and time again. It is not just about businesses or jobs—although clearly businesses and jobs are lost—but about the effect on people’s lives. I understand that as a business person myself. My business has been my life. If somebody had taken my business away from me in those circumstances, I do not know how I would have coped.
The Minister may say that many cases are not proven or that the banks may write with various reasons why claims are wrong. That is why we do not put the APPG forward as an arbiter of whether the customer or the bank is right in such cases. We do not think the APPG, the victims or the banks should play that role; it must be somebody entirely independent. As I have said before, we recommended a tribunal approach to solving this imbalance of power. What my hon. Friend the Minister has managed to bring about is something new, called the Business Banking Resolution Service, which we think is a great step forward. We in the APPG have been working with the BBRS for the past year. It will mean that we can look at historical cases and at cases going forward, and at larger businesses too. It is absolutely the right thing, and we believe that the method of adjudication is good.
Our concern is, of course, as I have discussed with the Minister on many occasions, that that approach excludes people who have been through other independent bank-led reviews, which we think is wrong. We think the banks should look at such cases again where there is material evidence that something has not been settled fairly, but with the BBRS as a fallback. We think that is fair, and that should go for all victims of all bank-led remediation schemes who feel there is still a case to answer.
We also think there are other issues that need to be dealt with within the Lloyds Bank Review, certainly on eligibility. The review had very tight restrictions on eligibility: the victim had to have dealt directly with one of the two people convicted of the direct fraud, Lynden Scourfield or Mark Dobson. We think that is an unfair restriction. Lloyds has made ex gratia payments—I think £65,000 in total—that are only allocated to certain people who have been through that scheme or are assessed as being appropriate to go through that scheme, which, again, we think is unfair. Lloyds should look again at that.
We see a lot of people now putting their cases forward for the Business Banking Resolution Services. Our constituents who have these kinds of problem can put their cases forward, and we urge them to do so, but when they do, while their cases are being assessed, we think the bank should declare a moratorium or a stay of proceedings on any cases going through that process.
To conclude, we see this as a crucial opportunity, not only for Lloyds to get this right now, but for the wider business-banking relationship. We are very grateful to the Minister for the steps he has taken, both in appointing Sir Ross Cranston and on the Business Banking Resolution Service. We very much thank Sir Ross Cranston for his excellent work. We see this as a crucial opportunity to restore confidence in the free market system, to ensure that individual victims have access to justice and compensation and to improve the appetite for SMEs to borrow, start businesses and grow them, thereby giving a timely boost to UK plc. Let us ensure that we do not waste the opportunity.
The debate can last until 5.30 pm. If there are any Back-Bench contributions I can take those, but I need to call the Front Benches no later than 5.7 pm. The guideline limits are five minutes for the SNP, five minutes for Her Majesty’s Opposition and 10 minutes for the Minister, and then Mr Hollinrake has a few minutes to sum up the debate at the end. The latest intelligence I have received is that we are expecting Divisions at 5.30 pm, but that they might come earlier. Members will know that if a Division comes during the debate, we have to adjourn for 15 minutes or half an hour, so Members might want to be mindful of speeding up their contributions to ensure that we finish the debate before a Division occurs.
I apologise for not being on time, Mr Hollobone; I had a short-notice meeting with the Under-Secretary of State for Northern Ireland, the hon. Member for Worcester (Mr Walker) on Northern Ireland issues, and we had to go to meet him. I talk very fast, Mr Hollobone, as you know, but in the next few minutes I am going to get more words to the minute than any other person ever got, if that is possible. I hope I do not talk so fast that Hansard cannot follow it—I will certainly do my best.
On 18 December 2018, 13 months ago, we gathered here in Westminster Hall for a debate on the same subject of Lloyds HBOS, some nine years after the matter was first raised in the House in June 2009 by Sir James Paice MP. My substantive support for a proper and independent review of the Griggs HBOS bank-led remediation scheme is a matter of record in that debate. Less well-known is what has happened since, so let me put some of that on the record from my perspective today.
I begin by drawing the House’s attention to a few paragraphs of an excellent article that I read, by Helen Cahill in The Mail on Sunday on 25 January. Helen wrote:
“Sources said Horta-Osorio, who has been at the helm of Britain's biggest retail bank since 2011, is keen to salvage his reputation before departing as chief executive.
He has also halted three legal battles with victims in an effort to repair relations between the bank and its small business customers.
Victims have been fighting for fair compensation for more than a decade. Nikki Turner, director of victims’ group SME Alliance, said: ‘We have struggled with this for years. We hope this will encourage other chief executives to be more hands-on. How do you know what’s going on in the bank, if you don’t know about it personally?’”
Then, in what in my view will prove to be a seminal article, for Reuters last Wednesday, under a section entitled:
“Chief executives at a conduct crossroads”,
Rachel Wolcott wrote:
“Bank chief executives face a choice in 2020. They could take actions to resolve fairly disputes and claims stemming from past misconduct. That then would set the tone for how such problems are solved in future and reinforce cultural transformation messaging.”
There are a lot of things that can be done.
“Alternatively, they could continue approaches that resulted in unfair customer redress schemes, customer claims being wrongly denied, and vulnerable customers hauled through the courts.”
The article quotes Ruth Steinholtz as saying:
“They can’t have it both ways.”
They think they can, but they cannot. Ruth Steinholtz is further quoted as saying:
“They say they want to increase trust, but they can’t do that if they don't take responsibility for their actions and admit they got it wrong. I do think there has to be some sympathy for the reason they have difficulty admitting getting it wrong, which is they get slammed by the regulators every time they do”—
but if it is wrong, it is wrong and they should say that.
The article continues:
“The Cranston Review, which saw Lloyds Banking Group’s handling of HBOS Reading victims criticised, may have been a catalyst for that very change in approach required to take Lloyds’ cultural transformation work forward. Lloyds has invested in efforts to improve culture, making key hires and revamping its purpose, values and behaviour statement. Recent decisions by Antonio Horta-Osorio, chief executive to increase HBOS Reading fraud victims’ compensation, pre-empting further unflattering investigation results expected in the Dobbs Review, was deemed as a step in the right direction.”
It is, and it should be seen as such. The article goes on to say:
“If this approach continues to influence Lloyds’ engagement with mortgage prisoners, cases that come through the Business Banking Resolution Scheme (BBRS), PPI claimants and yet to be uncovered conduct problems, its chances of achieving meaningful cultural improvements may increase.
Barclays, RBS, Virgin Money and other UK banks have not made public any change in attitude towards legacy conduct issues, however.”
It is disappointing that they have not.
“Banks, via UK Finance, contested the eligibility criteria for the BBRS, which is aimed at putting SME mistreatment in the past.”
“Most banks have made few meaningful actions to help mortgage prisoners or customers whose loans were sold to debt collectors and vulture funds.”
That includes Lloyds as one of the culprits.
“David Duffy, chief executive at Virgin Money Holdings, in contrast to Lloyds’ recent approach, has rebuffed the FCA’s Bailey’s specific requests to ‘deal with’ some of its most troublesome and longstanding SME customer disputes.”
Mr Duffy is noticeably where his Lloyds CEO counterpart was a few weeks ago, pre-Cranston, and in my view he needs to move his position to remove the shackles strangling this bank.
The Minister will be well aware of the case of John Guidi, the CYBG, now Virgin Money, hunger striker, and his recent correspondence, now publicised on Twitter and elsewhere, detailing the implications of both his case and many others. It is insightful to read the Reuters article by Lindsey Rogerson on 24 January, headlined:
“Outgoing FCA chief advocates for bank victims inclusion in new resolution scheme”.
That is good news.
The article addressed Andrew Bailey’s public and private view on both Mr Guidi’s case—I have probably pronounced his name wrong there—and those of the other victims of banks that are not yet participating in the BBRS, such as Zurich Dunbar. I ask the Minister, in his concluding remarks, to respond by giving his view and that of Government on the following observation by Mr Guidi:
“Meanwhile, the Vulture funds appear to be untouchable by the law yet they use their distorted version of law for their own benefit to destroy the honest and hardworking, tax paying SMEs and individual people of this country and leave them destitute as a burden on the state while they themselves pay no taxes in the UK, Ireland or anywhere else.”
I turn now to an instance that I witnessed, together with our voluntary adviser, Brian Little at Westminster for Banking, who has assisted with auditing and whistleblowing since that December 2018 debate. I was approached by Lloyds Banking Group’s public affairs director, Mr Benedict Brogan, who asked to speak with us about the content of various parts of my speech, which Brian and I were very willing to do. Our first meeting took place immediately on the resumption of Parliament after Christmas 2018.
A number of matters were discussed, including—specifically relevant to the debate—the importance of a meaningful and competent review of the Griggs scheme, together with the crucial involvement of victims’ representatives in the recently announced dispute resolution scheme, now called the Business Banking Resolution Service. From our experience in Northern Ireland, we believe that all the people cannot really move on until the victims’ aspects are properly considered and a closure and reconciliation process undertaken, as the hon. Member for Thirsk and Malton (Kevin Hollinrake) mentioned; I only caught the tail end of his speech, but I have spoken to him about this. He and I both requested this debate, and I am pleased that we got it.
As a result, over the next couple of months, Mr Brogan engaged with other banks, and centrally Mr Horta-Osório suggested that Nikki Turner of the SME Alliance be invited to join the independent steering group, or ISG. Bearing in mind that Paul and Nikki Turner had been the subject of 22 applications for eviction by Lloyds, and that the Lloyds CEO was subjected to calls for his resignation in Parliament in that December debate, this was an enormous ask, and impossible in many people’s eyes; in effect, a few of us were thought of as mad. We understand that, when António was approached on the subject, after several seconds of reflection and following his interview by CNBC in Davos in January 2019, he looked up and said words to the effect that “it was the only way forward”, and so it is.
Shortly afterwards, on 12 March 2019, Nikki and the SME Alliance released to the press that they had been invited and were joining the ISG of the DRS. That press release also referenced Mr Ian Lightbody from the CYBG Remediation Support Group. Unfortunately, the DRS chairman, Mr Lewis Shand Smith, did not follow Ian’s involvement through, despite another small business representative board member from Make UK being unable to attend. That was, and remains, a huge disappointment to Financial Conduct Authority CEO Andrew Bailey, the SME Alliance and the all-party parliamentary group on fair business banking.
Despite the time pressures across many fronts on Andrew Bailey, who is soon to be Governor of the Bank of England, we witnessed his personally taking charge of the interviews for the chair of that review with an unwavering commitment to the values and intent of that process, which we welcomed. After a couple of challenges in securing other candidates, Sir Ross Cranston was selected. He has proven to be exactly what was required—independent, evidence-led, competent, fair and robust. I put on the record our thanks and gratitude to both Andrew Bailey and Sir Ross Cranston for their work on this in 2019. I must also add thanks to the Lloyds CEO, Mr António Horta-Osório, who devoted some of his time to overseeing not only the HBOS aspect of this but the treatment of other victims, such as victims of Lloyds business support unit. I wrote to António to thank him personally on Monday 20 January.
Yes, Rachel Wolcott is right: bank chief executives are at a conduct crossroads in 2020. How true that is. This is the year that their actions, including active support for the BBRS, will communicate to their staff, the victims and the public at large whether cultures are really changing.
My final point relates to a victims’ conference I attended and spoke at on 17 September last year in London, where I heard Brian Little tell a story to victims that got everyone’s attention. It is on YouTube; most things seem to be nowadays. Back in 2011, Brian was a constituent of mine, and he still is. He had a mental breakdown for some 17 months, during which time I, as a new MP, and with my parliamentary aide, assisted in keeping his whistleblowing case alive during his diagnosis and recovery.
During that time, we met the now-Lord Andrew Tyrie, in his role as Chairman of the Treasury Committee, in relation to independent reports and assessors. By coincidence, António was the subject of stories on the front page of The Daily Telegraph on 4 May 2011. While only just in the CEO role, António had taken the brave step away from the UK Finance position on PPI and stated that Lloyds must address the compensation issue. Back then, that was perhaps £5 billion to £10 billion across the banks; it is now more than £50 billion, but it was the right thing to do. Brian’s story was about cover-ups in reports; the court eventually found that he had made 12 protected disclosures.
On Saturday, I read an article in The Times in which Katherine Griffiths wrote that António was now the longest-serving CEO in the FTSE 100, and that the search for his successor is imminent. Whether accurate or not, I ask through this House that Mr Horta-Osório continues what a number of us have witnessed in the last few months: personal involvement and oversight of the Cranston compensation review and active support for the BBRS, and perhaps even the involvement in a closure and reconciliation process at Lloyds, which we would be more than happy to discuss with him prior to any departure or retirement.
I am conscious of the time, so I will scoot forward to near the end of my speech. In relation to third-party debt, can I ask that the Minister takes similar action immediately? Most of this will not be about individual cases, but I am concerned that the BBRS will not be ready in time to hear the case of Nigel Henderson, as he is terminally ill. While the Minister consistently states that he is unable to address individual cases, which I understand, I should think that he would wish to publicly endorse the emergency cases policy of the BBRS that James Hurley reflected in his recent article in The Times, in which he wrote:
“Bosses of the service have been asked to prioritise cases where business owners are terminally ill and where there are imminent repossession or bankruptcy issues.”
It is morally right to do that, so why should we not?
An open letter to the Prime Minister last Wednesday from the Banking Victims for a Future groups stated:
“The objective is to have Banks put things right, redress customers, where they should be redressed, and continue to reinforce our work that Banks really need to earn people’s trust. Without this redress through a credible Business Banking Resolution Service (BBRS) followed by an appropriate closure and reconciliation process, within each bank, for the last 20 years we will not help this nation and its people, through many small businesses, PROSPER in a post-Brexit United Kingdom.”
Everybody will want that, whether they are in favour of Brexit or not.
I will conclude with this comment from UK Mortgage Prisoners:
“We do not want to be left behind within our Prime Minister’s hope for our nation. We didn’t deserve this and should not continue to suffer. We insist that our ‘People’s Government’ provide a solution and reflect it in the chancellor’s budget speech on 11th March 2020, to the nation”.
I look forward to hearing the Minister’s response to my two key points and to whether he endorses these aspirations of the Prime Minister. I thank you, Mr Hollobone, and hon. Members for enduring my speaking at 60 words to the second, or thereabouts.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I pay tribute to the hon. Member for Thirsk and Malton (Kevin Hollinrake) for his diligence and for his role in the all-party parliamentary group on fair business banking, and for bringing yet another debate. I also pay tribute to Heather Buchanan for her diligent work behind the scenes.
If this process has taught us anything, it is that we need urgently to look at reforming the banking system into an ethical model that works for customers, whether they are private individuals or businesses, because this scandal has evaded every safeguard that ought to protect customers. As the hon. Member for Strangford (Jim Shannon) said in hope, there should now be a positive influence on the behaviour and attitude in banks, but an awful lot still needs to change. As he also mentioned, this is much bigger than only Lloyds and HBOS, and we need to look more widely at the issue.
Customers were defrauded of millions of pounds, and there was nothing short of a corporate strategy within Lloyds to cover that up. There is evidence that the bank’s own compliance officers were involved in the cover-up. The scandal was not uncovered by a regulator but by whistleblowers such as Sally Masterton, who was treated appallingly by Lloyds—as the hon. Member for Thirsk and Malton laid out—and put on enforced leave for her part in bringing the issue to light. She was even prevented from working with the police to bring about an end to the scandal. If we cannot rely on whistleblowers to be supported through this process, we have a serious problem. The hon. Gentleman also mentioned the Turners, and we should pay tribute to them for their 10-year battle through this as well. It should not take 10 years for people to get a reasonable response and to get justice when they have been wronged.
The independent Griggs review was supposed to deliver compensation to the victims, but this too fell short of expectations. The role of the independent reviewer was to oversee cases to ensure that they were fair. However, customers criticised the process, owing to the unaccountability of the reviewer, who would often fail to disclose what information had been provided to them from the bank. Some described it as corrupt, and many have reported it as being a thoroughly awful experience. Cranston himself described the banks as confrontational and, at times, forceful, which is completely inappropriate, regardless of the situation. Customers had no way of knowing what was fair or of seeing the working behind it. As the hon. Member for Thirsk and Malton mentioned, there is an inherent power imbalance within this, with people having to go to court and pursue this over many years, which many could not afford to do.
I know that Members across the House will be grateful for Sir Ross Cranston’s diligent work in his review of this fiasco, and we thank him for that. Particularly welcome is his recommendation that customers should be released from egregious settlement agreements, which many customers agreed to as they were offered on a take-it-or-leave-it basis by the bank; customers often felt that they had no other choice.
Sir Ross Cranston also recommends that the bank must arrange for the reassessment of direct and consequential losses by an independent body. In his report, he says that
“this part of the Customer Review, both in structure and in implementation, was neither fair nor reasonable… Other inconsistencies also resulted in unfairness… The general failure to communicate in a sufficiently clear and transparent way caused confusion”.
The bank did not make a single redress payment for direct and consequential losses to any business individual affected by the scandal. This could cover such damage as loss of opportunity, loss of profits, reputational damage, and claims for the impact of the scandal on a customer’s personal life. Given the time period over which this took place, it is clear this could have had a huge impact on the lives of the victims of this scandal.
It is unfortunate that banks cannot always be relied on to act in the best interest of their customers without adequate enforcement of the rules. We cannot allow them to mark their own homework. I urge the Minister to investigate the possibility of creating a permanent commercial financial dispute resolution platform, which would allow a streamlined process for consumers to hold banks to account and go some way towards alleviating the suffering of victims of mis-selling.
Although there is no doubt that some individuals went to great efforts to bring justice to the victims of this scandal, there is still no straightforward recommendation for redress for customers, for them to achieve the fairness and justice they deserve. We have seen people lose their businesses and livelihoods before any justice was served. People such as those mentioned by the hon. Member for Strangford, who have suffered through ill health or who have aged in the intervening years, need to see that soon. For many people, those opportunities may be lost forever. The Treasury must act to ensure that a scandal of this magnitude cannot happen again. The legacy of this saga must be change across the board.
My hon. Friend the Member for East Renfrewshire (Kirsten Oswald) mentioned Clydesdale and Virgin Money. We know other issues are brewing out there. I ask the Minister to take those into account. Again, I thank Sir Ross Cranston for his report, and the significant pressure for change, which leaves it to us and the UK Government to act.
I am grateful, Mr Hollobone, for giving me the chance to respond to this debate. I thank the hon. Member for Thirsk and Malton (Kevin Hollinrake) for securing this debate and the all-party parliamentary group on fair business banking for all its efforts to secure justice for victims of banking fraud and misconduct.
The hon. Gentleman has made clear the significance of the Cranston review in reconsidering the process by which banks compensate business customers where there has been historical misconduct. I add my voice to his. Strangely, this is now a positive story: we finally have the review we all wanted, although the journey to get here has been fairly tortuous.
Everyone here has been involved in these issues for some time. In my time as the shadow City Minister I have had to become familiar with and speak about an appalling litany of complaints about how business customers have been treated, not multinational businesses, but the small businesses that we would all recognise as the backbone of our constituencies and this country. The stories have been of livelihoods and relationships destroyed, and of entrepreneurs and companies losing family businesses they have spent years building.
We are here to discuss Lloyds. The HBOS Reading issues were clearly an issue of criminal liability in that bank. In the wider sector we have discussed a whole range of unacceptable conduct: the mis-selling of interest rates and hedging products, the mistreatment of companies in distress by pushing them into restructuring, and the unscrupulous sales of loan books to vulture funds. That is why the question of how redress happens has become so important.
Research shows that a frighteningly small number of small businesses in this country believe that their bank will do the right thing by them. Given the reports detailing the historical conduct we have discussed, we cannot blame them. We must all improve on that. Whether we are politicians, banks or businesses, this lack of confidence is not in our interest. We need to be able to tell our constituents that there is a level playing field when they find themselves in conflict with their bank, and that there is a path to fairness, justice and proper redress.
Too often, in recent years, the response from banks to us has been, “Systems are in place and we believe they are fair. All the historical issues have been sufficiently dealt with.” This report has shown unequivocally that not to be the case, vindicating those of us who have campaigned in this area for years, particularly the hon. Member for Thirsk and Malton.
It is not acceptable for industry to equivocate on this any longer and, to use the hon. Gentleman’s phrase, to mark its own homework. Key problems identified in the Cranston review include the lack of independence in assessing complaints and the benchmark for compensation being so high that no customer could hope to meet it. It is important that we, as parliamentarians, learn the lessons from these observations and embed those principles in any new schemes. I look forward to the Minister’s response to the review.
There are other avenues we must continue to consider, to get to the root of this problem. I believe we should consider a full public inquiry into business banking scandals. This review is about the shortcomings of one bank compensation scheme, but it emphasises the importance of investigating all areas of misconduct, not just to ensure that victims get fair compensation—that is the minimum—but to identify systemic problems at the root of these scandals, to prevent them happening again. That could be challenging to us as parliamentarians.
I always worry that the model of banking in this country, whether for customers or small businesses, effectively relies on upselling products, so we do not really pay for the cost of our banking services, and therefore we have business models where products must be sold on to banking customers. Perhaps we need to look at that. We must continue to work towards the success of the business banking resolution scheme, to assess how successful it is in addressing these problems.
The hon. Gentleman makes a good point about products and services being sold to consumers and businesses. The royal commission in Australia determined that one of the biggest drivers of mistreatment of businesses and consumers was the incentives paid to people at the sharp end to sell those products. The hon. Gentleman is absolutely right. A public inquiry might well identify where this is going so badly wrong.
I am grateful to the hon. Gentleman for his intervention. We must look at the issue that he raises. In some ways, we have already addressed some of the things that the Australians had not yet got round to, as the scope was different, but that must be part of the conversation, because we can go back, decade after decade, and find historical problems in the sector. Clearly, something is happening, whether it involves the incentives for staff or the structure of the sector, that we might want to change.
I mentioned the business banking resolution scheme. Historically, I have always supported an independent tribunal system and I still believe that that proposal has merit, but perhaps we need to revisit regularly the BBRS’s work to ensure that it is getting the results that it requires in the timeframe.
My final point is on whistleblowers. Sally Masterton was mentioned. She was treated disgracefully. Other countries have much stronger protection for whistleblowers. I think we could look at that issue. If I were, as I have always wanted to be, in the Minister’s place, responding to the debate, I would want us to take that forward, to ensure that we really had an appropriate system that addressed all the needs.
It is a pleasure to serve under your chairmanship again, Mr Hollobone. I, too, pay tribute to my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake). Obviously, in this role, I have shadow Ministers shadowing my every move, but I also have my hon. Friend, who has spoken up very effectively on these issues over the past 25 months. We have had a constructive dialogue on many matters, and I look forward to addressing the points he and others have made in my response.
It has been just over a year since I announced that Lloyds would commission a review into the Griggs compensation scheme, which is another stepping stone in Lloyds’ journey to right the wrongs of the past and rebuild trust with their business customers. From the outset, I was clear that if the findings of the review were to hold up to scrutiny, the person overseeing it must be truly independent. I was therefore delighted by the appointment of Sir Ross Cranston, a former Labour Member of Parliament who was Solicitor General between 1998 and 2001 and is a professor of law at the London School of Economics, a Queen’s counsel, and a retired High Court judge. I met him on two occasions to check on progress, between May and when purdah commenced. That was not to influence him regarding the particular conduct, but to encourage him to look at this issue as thoroughly as possible.
Sir Ross found that the Griggs compensation scheme had serious shortcomings, as has been expressed fully in this debate, and that it did not achieve the stated purpose of delivering fair and reasonable compensation offers. Assessments of direct and consequential loss were too adversarial and legalistic, which was unfair and unreasonable for the customers it was designed to support. Sir Ross also found several other inconsistencies, along with a general lack of clarity underpinning the scheme, while the bank’s failure to communicate with customers in a transparent manner caused further unnecessary confusion.
Sir Ross found that some elements of the compensation scheme were good. For example, Lloyds provided generous legal assistance and wrote off some customer debts, as well as paying substantial distress and inconvenience redress. Nevertheless, the overriding conclusions were hugely disappointing, and Sir Ross has made it clear that Lloyds has more work to do to achieve the stated aims of its original compensation scheme.
The most substantial of Sir Ross’s recommendations is that customer claims for direct and consequential loss must be reassessed, and Lloyds is working with customers and relevant parties to agree the details of this process. I know that representatives of Lloyds have been mentioned in this debate, and I have been given assurances that they are eager to get on with things. That could be through the new Business Banking Resolution Service, which has been referred to in today’s debate, or through an equivalent scheme that is committed to achieving the same rigorous outcomes. Either way, it is pretty clear to me that these cases must be considered by an independent body in a transparent manner.
There has been work on this issue by the all-party parliamentary group on fair business, with support from Heather Buchanan, who was mentioned earlier, and the SME Alliance. I also know that Sir Ross Cranston himself is engaged in this process, which must continue, and must be thorough and rigorous.
Sir Ross has also recommended that Lloyds make payments to cover the debts of customers who repaid or refinanced loans, as well as releasing customers from certain aspects of their settlement agreements. It is vital that Lloyds now implements the recommendations as quickly as possible and continues to support customers as they navigate this process. I will follow progress closely and I expect to be regularly updated; I have made that clear.
I turn now to some of the points made by hon. Members throughout the debate this afternoon. The hon. Member for Gower (Tonia Antoniazzi), who is no longer in her place, asked whether all reviews should be tested against Sir Ross’s methodology. I will just say this: I think that all banks have a responsibility to reflect on the findings of the Cranston review and consider whether their own redress schemes achieved fair and reasonable outcomes for customers. Obviously, people have different interpretations, but the Cranston review is a wake-up call to banks to examine whether the appropriate transparent processes have been followed. That should happen now.
Will the Minister give way?
I will just make my next point, then I will give way to my hon. Friend.
My hon. Friend the Member for Thirsk and Malton asked about the appropriateness of the Financial Conduct Authority carrying out a review under the senior managers and certification regime. As he will know, the FCA is operationally independent of Government and it is for the FCA to consider whether there is sufficient evidence for such an investigation.
I know that we have spoken previously about Dame Linda Dobbs’s investigation, which has been ongoing for a considerable amount of time. That really needs to come to a conclusion; we need to see the results of that investigation. However, I cannot say more than that, because it is a matter for the FCA to consider. Now I am very happy to give way to my hon. Friend the Member for Beckenham (Bob Stewart).
I thank the Minister for giving way; he is an honourable and decent man. However, what shocks me most about all of this is that some banks are not acting decently and honourably. That really worries me; they should do that naturally. They are a bastion of our society, just as business is.
My hon. Friend makes a powerful point, which goes to the core of this matter. The Cranston review points to the fact that we now have a higher bar of expectations in terms of how these redress schemes should be operated in a transparent way. He has spoken in this debate and previously about the distress that has been caused to his constituents, and many other Members have also made points during this debate.
The wider banking industry has a responsibility to reflect on the review’s findings and act accordingly, so I welcome the banking industry’s commitment to creating a new scheme to address unresolved historic complaints from small and medium-sized enterprises that have not been through a formal independent process, and to address future complaints made by slightly larger SMEs that are just outside the remit of the Financial Ombudsman Service.
Will the Minister give way?
I will in a moment.
The aforementioned Business Banking Resolution Service opened to expressions of interest last November, ahead of its full launch later this year. Meanwhile, the expansion of the FOS last April means that over 99% of all SMEs now have access to fair, free and fast dispute resolution.
The hon. Member for Strangford (Jim Shannon) asked me to give way; I am happy to do so, but I want to refer to the points that he made. He referred to the eligibility of the BBRS. It is not for me to determine the eligibility of the BBRS, but his points about the prioritisation of cases will have been heard very clearly by those who have set up that service, and I urge the BBRS to reflect on his contribution to this debate.
The BBRS and the expansion of the FOS build on several initiatives that the Government have introduced, including the senior managers certification regime, which will hold key individuals at banks to account for the decisions that they make, including decisions that could impact on their SME customers. The industry has also made changes. For example, all major lenders are signatories of the standards of lending practice, ensuring that banks treat their customers in a fair and reasonable way. I hope that these steps, together with the work carried out this year to address historic SME disputes, will bring unresolved disputes to a close and prevent the same circumstances from occurring again.
I will conclude by saying that over the past year Sir Ross has taken considerable time to discuss sensitive and often distressing matters with customers; he has had 49 meetings with 62 customers, alongside his adopting a detailed and forensic approach to the cases he has reviewed, so I thank him for his efforts.
I welcome the commitment of Lloyds to implementing the recommendations of the Cranston review, and I will follow progress closely. I note the points made by the hon. Member for Glasgow Central (Alison Thewliss) and others, and I will reflect on them carefully.
The establishment of the Business Banking Resolution Service provides a further means of redress, and I look forward to seeing it bring closure to many long-running disputes. I am confident that we can continue to build on the good work that industry, small business representatives, regulators and Government have begun to rebuild trust, so that small businesses can access the finance they need to prosper and grow.
I call Kevin Hollinrake to sum up the debate.
I am grateful to you, Mr Hollobone, for calling me again, and to the Minister for his comments.
Sir Ross Cranston has left a tremendous legacy with his report, and I am very pleased to hear that the Minister thinks similarly. This matter is not just about this individual review process—the Griggs review. An industry benchmark should be set on how to do things and how not to do them, and on what “good” looks like. The Minister is absolutely right that all banks should look back again at their processes and reviews, and make sure they have got things right.
The other thing we need to learn from this matter is that when these processes—these redress schemes—are set up, we have to put the victims at the heart of them; we have got to get the stakeholders at the heart of them. Lloyds did not do that and nor did Royal Bank of Scotland. Sir Ross, more than anybody else, has done that, which must be the lesson that we learn.
I will conclude by saying that Churchill once said of the Americans that they always do the right thing but only after they have tried all the alternatives. That is what we must consider when we try to hold businesses to account; we must assume that they are not going to do the right thing. They are many very decent people in the banking sector and in business more widely, but we simply cannot trust that people will do the right thing. People do what is inspected and not what is expected, so we must absolutely make sure that we do our bit. I know the Treasury will do its bit to try and ensure that we get this matter right, but the FCA, the BBRS and all those different stakeholders need to ensure this time that we get things right.
Question put and agreed to.
That this House has considered Lloyds, HBOS and the Cranston review.