Climate Change and Sustainable Energy Bill Speech

Brooks Newmark makes a major speech on the Climate Change and Sustainable Energy Bill and highlights the successes of Braintree Council's pioneering scheme to offer council tax rebates to home owners who install cavity wall insulation.

Mr. Brooks Newmark (Braintree) (Con): I, too, commend the hon. Member for Edinburgh, North and Leith (Mark Lazarowicz) for his foresight in introducing the Bill. I very much welcome the contribution that he has made by encouraging a progressive and sensible response to climate change. The time is long overdue for us to confront this ever-present and growing concern, so I should like to talk about the broader principles that the Bill addresses.

We must all recognise that we face an overriding problem when dealing with climate change. My hon. Friend the Member for South-West Bedfordshire (Andrew Selous) identified the difficulty during the Opposition day debate on tackling climate change. He said then that
"we are unlikely to make progress on climate change until the public take it more seriously, and . . . we have all failed in doing that job".-[Official Report, 12 October 2005, vol. 437, c. 365.]

That very much backs up the point that my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) made. This is not a high priority on many people's lists. When lists are published they include crime, health care and law and order, all of which are far more pressing issues on people's minds. However, as my hon. Friend the Member for Kettering (Mr. Hollobone) and the right hon. Member for Oxford, East (Mr. Smith) said, this is indeed a pressing matter, particularly for young people. They are the people who send me letters and make representations to me on the subject.

Mr. Forth: I am sure that my hon. Friend, taking the interest that he does in the subject, is absolutely familiar with the excellent report recently produced by the House of Lords Select Committee on Economic Affairs, which, if I get a chance to catch your eye, Mr. Deputy Speaker, I may want to expand on. Is my hon. Friend aware of their lordships' excellent conclusions, and if so what weight does he give to them?

Mr. Newmark: I very much appreciate my right hon. Friend's guidance on this matter. I confess that I have not had the time that he has had to study it in the depth that he probably has, but that does not necessarily negate the argument that I am making.

If we continue to talk of climate change in terms of international accords and global trends, we shall continue to fail in winning over the public. Kyoto is important and effective carbon trading is important, but if ever an issue needed to be tackled at a grass-roots level it is climate change. That is why I believe that the Bill raises a very important principle.

It seems that we have two options for encouraging a change in public opinion. The first is to continue with sporadic warnings about the dire consequences of doing nothing. They will unfortunately occasionally be backed up by tragedies, like Boscastle, or farces like the annual water shortages caused by the wrong kind of rain. The alternative is to provide meaningful and accessible incentives-I use that word as opposed to regulations or directives-for ordinary people to contribute to the country's energy efficiency.

In 2002, domestic users accounted for about 24 per cent. of the UK's greenhouse gases and 27 per cent. of carbon dioxide emissions. Three quarters of that figure results from heating and hot water alone. Indeed, domestic users are the largest single group of energy users in the UK, which is another reason why I find the Bill extremely attractive.

About 140,000 new houses are built each year, and that could increase to 260,000 a year in the light of the proposals arising from the Barker review. Building regulations were upgraded in 2002 to increase the performance of new dwellings by 25 per cent., and I welcome the increase of another 25 per cent. this year. However, regulations are not quite the same as incentives and they are not nearly as effective.

Regulations do not generally encourage anyone to exceed the acceptable minimum standards. I therefore believe that the right thing to do is to offer fiscal incentives for energy efficiency.

I shall address the proposals in clauses 3 and 5 with reference to the example set by my own constituency of Braintree. Braintree council recently introduced a pioneering scheme to offer council tax rebates to home owners who install cavity wall insulation. Residents who join the scheme get a £100 council tax rebate for spending £170 on having their walls insulated. It is possible to save £100 on heating bills in the first year alone. That in itself must be attractive, and probably far less costly than perhaps even the micro-generation proposals that were mentioned earlier.

Mr. Mark Harper (Forest of Dean) (Con): My hon. Friend knows my concern-we discussed it earlier. The Braintree scheme is admirable, but there are parts of the country where, due to the nature of historic building construction, many householders do not have the option of installing cavity wall or similar types of insulation. If a local authority, on its own initiative, offers a council tax rebate to those householders who install insulation, those householders get a double benefit-they save some fuel costs and they get their council tax rebate. However, without support from the centre, that council tax rebate is effectively funded by other members of the community who are not fortunate enough to be able to make the energy saving. Will my hon. Friend address that point?

Mr. Newmark: My hon. Friend makes an excellent point. I believe that the scheme extends to loft insulation, as well. Councils throughout the land are increasingly having what we would all refer to as green agendas, and that scheme is very much part and parcel of an excellent green agenda for Braintree council.

Michael Fabricant (Lichfield) (Con): My hon. Friend makes an interesting point, and the intervention on him was particularly interesting. He mentioned loft insulation. Does he accept that thatched cottages offer tremendous insulation? He will have noticed, for example, that when there is snowfall, the snow evaporates quite quickly from conventional tiled houses, whereas it remains on thatch. Could it not be argued that there ought to be some financial incentive for people with thatched houses, too?

Mr. Newmark: I am sure that my hon. Friend is an expert on thatched coverage to the upper regions of one's house, so to speak. He is absolutely right-thatch is indeed an excellent form of insulation, as is white snow.

The Braintree scheme illustrates how quickly energy savings can repay capital investments. Tax incentives ensure an even quicker return, although I sound a note of caution about fiscal incentives. I believe that Braintree district council's scheme has been so successful because it is simple and easy as well as cost-effective. It is helped, of course, by the fact that the council tax is very much on everyone's mind at the moment-especially pensioners and the less well off-and any opportunity for a discount would immediately be attractive. The Association for the Conservation of Energy has said of fiscal incentives for energy efficiency that
"there is no doubt that consumers like to think they are getting something for nothing, especially if it is some kind of valid avoidance."

Mr. Nick Hurd (Ruislip-Northwood) (Con): I am grateful to my hon. Friend for highlighting the Braintree example because it is hugely important. The chief executive of the Energy Saving Trust told the Environmental Audit Committee that more than 600 households have applied for the rebate in just the few months since its implementation. Does not that information confirm my hon. Friend's thesis that exactly that type of short, sharp and simple fiscal incentive will break through the consumer apathy that has been the brake on attempts by successive Governments to make a breakthrough in the energy efficiency agenda?

Mr. Newmark: Indeed, my hon. Friend makes an excellent point. In fact, I had an opportunity to speak to the councillor who is leading the charge on this-Councillor Walters-who said that he has been inundated by e-mails from other councils that want to introduce such a scheme into their local communities because of its simplicity and cost-effectiveness.

Mr. Forth: My hon. Friend has already quoted what one if not two single-interest, publicly funded quangos have said on this subject. Does he have the same scepticism about their advice as the House showed to the chief police officers' advice that was so much criticised by Opposition Members just the other day? I hope that he is not suggesting that we should all accept uncritically what a single-interest, publicly funded quango says about something.

Mr. Newmark: Once again, my right hon. Friend makes an excellent point. I am always very sceptical about what comes from quangos. However, I also believe that it is important that we listen and then, having listened to whatever outside parties are involved, we reach our own conclusions and judgments. So having listened and read probably in a far more limited way than my right hon. Friend-I am sure that, as a much more learned Member, he has done much more work on this-I have reached my own conclusions, which I am presenting to the House today.

We must be conscious that not all fiscal incentives are so easy to understand. Clause 3 will require the Chancellor of the Exchequer to publish a strategy for fiscal and economic measures that will assist micro-generation and energy efficiency. The concern must be that the Chancellor's fascination with Gordian taxation schemes will run amok once again. An incentive is of no use if it cannot be readily appreciated as such by those people whom it exists to try to benefit. The danger is surely that the Bill will be railroaded into becoming yet another excuse for increased regulatory burdens in return for obscure tax credits.

Mr. Harper: My hon. Friend makes a good point about Gordian tax complexity. One or two Members have already mentioned the pitfall that those who set up micro-generation capacity might face if they find themselves with a liability to national non-domestic rates-business rates, to the layman-but there is also a risk, given the Chancellor of the Exchequer's well-known propensity for revenue raising, that household consumers who sell micro-generation capacity back to electricity companies might find themselves, either now or in future, taxed by the Chancellor on those revenues.

Mr. Newmark: I thank my right hon. Friend-[Interruption]-my hon. Friend. He is not right hon. yet. I meant right as in correct. I thank him for his contribution once again.

The paper, "Economic instruments to improve household energy efficiency", jointly published by DEFRA and the Treasury in 2003, lists no fewer than 12 separate economic instruments to encourage energy efficiency, including council tax and stamp duty rebates, which have already been subject to an early-day motion. I will not emit any further CO2 on the proposals listed in that report, except to say that we must be wary that the list does not grow unchecked. I have no hesitation in speaking in support of the principle of the Bill, but we have a duty to ensure that its provisions will be implemented as well as they have been drafted.

10.54 am

 

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