Climate Change Bill [Lords]

Public Bill Committee, 8 July 2008.

Schedule 5

Peter Atkinson (Conservative, Hexham)

I remind the Committee that with this we are discussing the following: amendment No. 109, in schedule 5, page 69, line 32, at end insert

‘but no charges for residual domestic waste can be imposed unless the authority has made provision to collect all other materials not less than once every 14 days, including, (i) all plastics of whatever type, (ii) polystyrene, (iii) paper and card of all descriptions including tetrapak, (iv) glass and (v) metal and aluminium.’.

Amendment No. 110, in clause 70, page 33, line 9, leave out subsection (2).

Amendment No. 107, in clause 70, page 33, line 19, at end insert—

‘(c) does not include a power to create a criminal penalty on any householder for non-compliance with any aspect of a waste reduction scheme.’.

New clause 18—Waste authority’s power to reduce amount of council tax payable—

‘After section 13A of the Local Government Finance Act 1992 (c. 14) there is inserted—

“13B Power to reduce amount of tax payable in relation to household waste

(1) Where a person is liable to pay council tax in respect of any chargeable dwelling and any day, any waste collection authority or waste disposal authority may require the billing authority for the area in which the dwelling is situated to reduce the amount which he is liable to pay as respects the dwelling and the day to such extent as it thinks fit.

(2) The power under subsection (1) may only be exercised in connection with measures to reduce the amount of residual domestic waste produced in the authority’s area.

(3) The power under subsection (1) may be exercised in relation to particular cases or by determining a class of case in which liability is to be reduced to an extent provided by the determination.

(4) Where an authority exercises the power under subsection (1) the authority must pay or allow to the billing authority if requested an amount equivalent to the total reduction in the amount of tax payable each year as a result together with the reasonable administration costs of making such reductions.”’.

New clause 22—Waste reduction incentives—

‘(1) A waste collection authority whose area is in England may make a waste reduction scheme, the objective of which is to provide an incentive to recycle more domestic waste and accordingly to reduce the amount of residual domestic waste.

(2) A waste reduction scheme—

(a) must provide for the incentive to be a payment of monies worth an amount which the authority considers will be effective to achieve the purposes of the scheme, and

(b) may, in particular, permit a person to be supplied with a voucher which may be exchanged for goods or services.

(3) A waste collection authority may make a waste reduction scheme only if arrangements for the collection of recyclable domestic waste from premises separately from other waste are available to the occupiers of premises to which the scheme applies.

(4) A waste reduction scheme—

(a) may cover the whole or any part of the area of a waste collection authority, and

(b) may apply to all domestic premises, to domestic premises other than those of a specified description or to specified descriptions of domestic premises.

(5) An authority that has made a waste reduction scheme—

(a) must publish the scheme in such manner as it considers appropriate, and

(b) may amend or revoke the scheme.

(6) Where a waste collection authority that operates a waste reduction scheme is not also the waste disposal authority—

(a) the waste disposal authority may pay to the collection authority contributions of such amounts as the disposal authority may determine towards expenditure of the collection authority attributable to the scheme, and

(b) the collection authority must supply to the disposal authority such information as the disposal authority may reasonably require for the purpose of determining amounts under this section.

(7) In this section—

“domestic premises” means—

(a) a building or self-contained part of a building which is used wholly for the purposes of living accommodation,

(b) a caravan (as defined in section 29(1) of the Caravan Sites and Control of Development Act 1960 (c. 2)) that usually and for the time being is situated on a caravan site (within the meaning of that Act), or

(c) a moored vessel used wholly for the purposes of living accommodation;

“domestic waste” means household waste from domestic premises;

“recyclable domestic waste” means domestic waste that is capable of being recycled;

“recycling” means recycling, re-using or composting.’

Steve Webb (Liberal Democrat, Northavon)

I look forward to hearing what the right hon. Member for Penrith and The Border has to say about the amendments that he tabled, when he has had chance to work it out. This group of amendments is different from that which we debated previously because, since our sitting on Thursday, two more measures have been added: amendment No. 110, which we tabled, and new clause 22. For the benefit of members of the Committee who might not have had chance to look at amendment No. 110, it questions the decision to restrict the number of pilots under clause 70(2).

Our approach is to allow 1,000 flowers to bloom, not five. There are big variations among local authorities. Urban, rural, and multi-tier authorities have different waste streams and structures for dealing with waste. In light of that, there is a huge amount of learning to be done. While I would not dream of accusing the Department of doing this, the present Prime Minister has a tendency to want to control things. Although, in one sense, the provision is enabling and saying, “Let there be pilots,” there must always be a “but” at the end, which is that we can have only five pilots. That is unnecessary.

The Bill refers to five pilots, so if the Government invited proposals for pilots and received 10 good ideas, they would be obliged to throw away five of them because, under statute, they will not be allowed to have more than five pilots. If the Government think that five pilots are all they can cope with, they are perfectly at liberty to decide to do that after receiving submissions, but to pre-empt looking at the pilots before they have even seen them is wrong, which is why my hon. Friend the Member for Cheltenham and I want to remove the stipulation.

Amendment No. 108 would exclude from participation in the pilots authorities that do not undertake weekly collections. As we said on Thursday, some schemes could be pure incentive schemes; in other words, some pilots need not be penal. Given that, at worst, they must be revenue-neutral, they could be net beneficial. Authorities, for whatever reason, that do not have weekly collections—that might be popular or accepted locally—should not be precluded from taking part in pilots whereby they could offer incentives to their residents to improve recycling. There is a valid debate to be had on weekly or fortnightly collections and whatever is appropriate in a particular area, but to preclude whole categories of authorities from running pilots because they opted in their particular circumstances not to have weekly collections seems unduly restrictive. We do not therefore support amendment No. 108.

We have a lot of sympathy with what amendment No. 109 is trying to do, but it is over-prescriptive. It refers to polystyrene and Tetrapak, for example, but we could find ourselves constantly amending legislation to cover new materials. We could certainly have central Government guidance and initiatives, but if we list specific individual materials—“metal and aluminium” itself is an interesting phrase—we would start to see some of the problems in identification. At the moment, we think that amendment No. 109 is somewhat over-specific.

New clause 18, which was tabled by the hon. Member for Bexhill and Battle on Thursday, relates to giving authorities the opportunity to cut council tax by means of an incentive mechanism. In principle, we have no problem with that. We are perfectly happy for local authorities to have that freedom. It was not apparent to us that they could not do that anyway under the Bill. If it is necessary to be explicit, we do not have a problem with that. However, we would probably need further legislation to make it happen. For example, imagine a council tenant on benefit who is on 100 per cent. council tax benefit. My understanding is that they do not pay the council tax and get the money back from the Government—they just never pay it. Therefore, if we wanted to incentivise people who do not pay council tax at all to cut their waste, it would be odd if their council tax was reduced and they got council tax benefit in excess of the council tax that they were paying. That would probably be illegal. Such an amendment would have knock-on effects, but, in principle, we do not have a problem with it.

Finally, we would be interested to hear what is meant by new clause 22, which has not yet been spoken to. It would probably be unhelpful for me to start guessing what it means, so I will draw my remarks to a close, but I might comment on that new clause once we have heard what it is meant to achieve.

David Maclean (Conservative, Penrith and The Border)

I am grateful to my hon. Friend the Member for Bexhill and Battle, who leads from the Front Bench, for moving the amendment that I tabled last Thursday. I apologise for not being able to be here, but I was on the Floor of the House dealing with an equally important question as saving the planet: MPs’ pay and allowances.

Where am I coming from with the amendments? I would not seek to press them to a vote or to delete the relevant measures, unless the Government volunteered to do so. However, over the past few weeks we have had important discussions about saving the planet. We have had discussions on global warming, carbon emissions, the loss of biodiversity and the destruction of the rain forest. We have been seeking to do incredibly noble things with reporting targets for 2050. I am not sure that any Committee, dealing with any legislation, has attempted to be so far-sighted or far-reaching. Now, near the end of the Bill, we have five clauses that are, literally, on garbage—on allowing councils to come up with what, in some cases, are hare-brained garbage-collection schemes or innovative recycling schemes. This could discredit the main purposes of the Bill.

We have already seen in the newspapers over the past few months stories about some of the imaginative ideas that councils have had. We have seen how some of the public have become cynical and disillusioned, because they believe that the rubbish that they put out is being recorded by spies or by cameras and microchips in their dustbins. I believe that there is scope for recycling initiatives. I believe that the Government should be running pilot schemes under fairly tight control. However, I do not believe that such measures should be in the Bill because that takes away from the glorious merits of the legislation before us.

Joan Ruddock (Labour, Lewisham, Deptford)

I know that the right hon. Gentleman was not present when we began the debate in our previous sitting, but there is a direct connection with the amount of waste that we householders throw away every year, the majority of which goes to landfill, producing methane, which is one of the most powerful greenhouse gases contributing to climate change. He might not think that it is entirely tidy to have the clauses in the Bill, but there is an important connection.

David Maclean (Conservative, Penrith and The Border)

The hon. Lady is right that there is a connection, but why do we not have clauses on the amount of motoring that we do, the cars that we buy and the contribution that transport makes? Why do we not have clauses on peat-land bogs and upland forests?

Joan Ruddock (Labour, Lewisham, Deptford)

The right hon. Gentleman knows that all such matters are considered in other forms of legislation. We can do—we are doing—many things to try and move towards having a low-carbon economy. However, we need the specific legislation, because we are the only country in the EU15 that does not allow charges to be applied for waste collection.

David Maclean (Conservative, Penrith and The Border)

This Bill is a convenient vehicle for the garbage clauses to be tacked on to. I am not suggesting that they are out of order because the long title of the Bill permits their inclusion. It is not just a matter of tidiness, although I do like tidy legislation—and tidy everything, to be honest. The schedule is inappropriate because it could disillusion the public with regard to our main purpose. People in the pilot areas and in other areas will struggle to put the right sort of material in the right boxes on whatever day of the week the council deigns to turn up to collect that sort of recycling material. When they get it wrong and are given penalties, I am afraid that they will say, “Well, it’s all this climate change nonsense and saving the planet,” and they could become disillusioned about our main purposes. I will not labour the point; I want to get on to the technical details.

John Gummer (Conservative, Suffolk Coastal)

Will my right hon. Friend press that point a little more before he gives it up? The Minister is just wrong. The schedule will distort the Bill in a way that will do damage. Already, local councils that tried to do what is proposed for a pilot scheme have found it much more difficult than they thought. At the moment, they—Tory as well as Labour councils—are being blamed. The Bill is about too big a matter for us to add to it this sectional interest, which the Government could have put in the Finance Bill or a whole range of other legislation. This shows that the Government have not yet realised what a huge undertaking they have taken on. In a sense, they have not built up the importance of the Bill.

David Maclean (Conservative, Penrith and The Border)

I agree with my right hon. Friend. I also agree with the Minister that it is important that recycling is increased. We need to educate the public to do that better.

I would have liked to have seen the Government’s “good” recycling scheme before going ahead with the measure. I am appalled at how some things have slipped in the House since the old days. When I was in government 10 years ago, we could never have come along to a Committee and said, “Pass this legislation. We will at some point in the future produce a good recycling service, and we will produce guidance and standards on what that is.” The Committee would have said, “Look, Minister, we are not going to go ahead with that until you produce the regulations and the guidance.”

Alan Whitehead (Labour, Southampton, Test)

May I help the right hon. Gentleman with an interesting quote? It states:

“Add to that, the impact of methane leaching from the decomposition of organic material which releases approximately 22 per cent of the UK’s methane emissions and it is obvious why no serious policy to combat climate change can avoid the problem of the way we use and discard material resources.”

That is a brief quote from the introduction to the Conservative quality of life commission report, which was authored by the right hon. Member for Suffolk, Coastal.

David Maclean (Conservative, Penrith and The Border)

Yes, of course it is terribly important. I do not want to go back to the discussion that we had two weeks ago but, as everyone admits, the rain forests are worth more than all the transport emissions in the world and we do not have a big section in the Bill on rain forests—the Government said, “Oh, it’s covered, we don’t want to deal with that.” Biodiversity is vitally important to saving the planet and it is not in the Bill. Yes, garbage and recycling make a contribution, but they have a huge part in the Bill, and it stands out like a sore thumb. It stands out like a piece of plastic in the newspaper recycling box because it is not appropriate to the Bill.

John Gummer (Conservative, Suffolk Coastal)

I hope that my right hon. Friend would agree that it is important to remember that the domestic waste stream is 8 per cent. of the waste stream as a whole, so even though the hon. Member for Southampton, Test is right about those figures, we are dealing with not the 92 per cent. but 8 per cent., and we ought to put that in context.

David Maclean (Conservative, Penrith and The Border)

My right hon. Friend is absolutely right. If the proposal was for a waste reduction scheme or a garbage collection scheme relating to all the garbage in the country, including the vast amounts that the commercial vehicles pick up each morning in the giant Biffa bins, or however else they collect it, I could understand it. My right hon. Friend is right: we have a Bill on carbon emissions, setting magnificent targets for 2050—which we can argue about ad nauseam—yet we have a few clauses on trying to create five pilot areas for a bit of domestic recycling containing weird and wonderful ideas and penalties. The pilots concern five of the authorities dealing with 8 per cent. of the waste in the country, so that is perhaps 0.1 per cent. of waste.

Joan Ruddock (Labour, Lewisham, Deptford)

There are measures to deal with all the other waste streams. I repeat that it is a specific necessity to deal with household waste streams. The recycling rates of commerce and industry, for example, are far ahead of household recycling rates. Regarding the right hon. Gentleman’s comment about what makes a “good” recycling scheme, on 19 June we issued the draft scheme for consultation.

David Maclean (Conservative, Penrith and The Border)

I am grateful to the hon. Lady for that latter point and I stand corrected. I hope the draft scheme will be circulated to members of the Committee. It is a pity that it is not in the room for us to study as we go along.

If industry and business are further ahead, let us have a specific Bill to lay out all the proposals for dealing with household waste in separate legislation, so that we can deal with it in detail. I do not want to get bogged down on that point—it was an aside at the start of the Committee. It is a pity that five or six clauses on garbage are stuck in such a major Bill.

John Gummer (Conservative, Suffolk Coastal)

Will my right hon. Friend note what the Minister said? The Government have done nothing whatever about the 20 per cent. of the waste stream that is construction waste. They have not insisted upon consolidation, they have not insisted that building companies behave properly, and they have no arrangement to help the links between local authorities and the building industry. We have the worst record in Europe, and the Government have done nothing. They have not even bothered to deal with the matter in the Bill.

David Maclean (Conservative, Penrith and The Border)

I am grateful to my right hon. Friend for those detailed observations, which I will leave for the Minister to respond to. We could do much more to use construction waste in recycling, whether in concrete blocks or road building and so on.

Gordon Banks (Labour, Ochil and South Perthshire)

Will the right hon. Gentleman give way?

David Maclean (Conservative, Penrith and The Border)

No, I do not wish to go down that route now, I wish to consider the amendment and explain what it is about.

Amendment No. 108 states that

“the authority proposes to collect residual domestic waste at least once in every seven days,”.

I suggest inserting that requirement into proposed new paragraph 2(2), so that a waste authority could create a waste reduction scheme. It would be allowed to do that, providing that it satisfied qualifications (a), (b) and (c), and that it collected waste every seven days. It would also be able to collect all recyclable material.

I then propose an alternative amendment, suggesting that authorities should collect every 14 days. An authority might not want to collect every seven days, as it believes that it has a good scheme collecting every 14 days. I personally think that that is too long and I am disturbed that some schemes collect garbage only every 14 days. However, in recycling garbage collection pilot schemes, collection up to 14 days is legitimate, so the option exists.

With my dodgy legs, I find it difficult, staggering with different boxes to the recycling bins, but I do my best to recycle. However, I am appalled to see the many rules that exist in district councils in different parts of the country—even in my area of Cumbria between Carlisle and Eden. There are different collections on different days. Some take paper but not cardboard, others allow paper and cardboard in the same box. There are numerous definitions of plastics. God help a person with a carrier bag full of plastic bottles that they are stuffing into the holes. If they stuff the carrier bag in with the bottles, they are in deep trouble. That will be a criminal offence, so they must go to another bin to dispose of the plastic bag.

There are different kinds of cans. I can tell the difference between a tin can and a Coca-Cola aluminium can, but the hassle involved in separating all that stuff in some ways prejudices me against recycling. It would be easier to put everything in a big bag and dump it at the tip. I do not do that, but at times, one is tempted. I can see that many others have been similarly tempted because of the sheer hassle of trying to separate things into too many different categories.

When I come to London—many of us have homes in the Westminster area—it seems to be all-in-one recycling. What is Westminster council doing? Is it doing it correctly, or wrongly? I assume that it is doing it legally. In the Westminster area, provided there are no food scraps, garbage or bits of cling film from food, all plastics, glass bottles, tin cans, containers, newspapers and card of whatever description—glossy Sunday colour supplements and ordinary newspapers—go into one recycling plant. I do not know how the council sorts it. I do not know if the council sorts it. Much of it may go for power generation, or incineration to create power. It is so convenient for householders that it is much easier to do and we are not prejudiced against doing it.

Anne McIntosh (Conservative, Vale of York)

Perhaps I can help my right hon. Friend. I followed the rubbish from Westminster to its ultimate destination, which is SELCHP—South East London Combined Heat and Power. I challenged the Minister about what is, in my view, a missed opportunity in the legislation, and about the need to educate people about what such schemes do. My right hon. Friend may not know that despite its name, SELCHP does not at present have a combined heat and power facility, or it may have just got it.

David Maclean (Conservative, Penrith and The Border)

I am grateful to my hon. Friend for that elucidation. The next time she is following the garbage truck, I would be grateful if she could call by my flat, because I have a huge bit of polystyrene wrapping from my last printer that needs to be taken to the tip.

Karen Buck (Labour, Regent's Park and Kensington North)

As a Member of Parliament whose constituency covers Westminster, may I inform the right hon. Gentleman that Westminster council has one of the worst recycling records of any local authority in the country? Whether waste is combined or separated, let us not be deluded into thinking that that in itself is the solution to the problem.

David Maclean (Conservative, Penrith and The Border)

The point is that Westminster council seems to be able to collect combined material from householders and do some separation. Presumably, it does not burn the glass or the metal in the power plant. It is able to separate that, I presume, and then burn the plastics and the paper. It has made it simple for householders by encouraging householders to use it. I see an awful lot of commercial waste lying around the streets from shops, pubs and cafÃ(c)s, which is presumably much more difficult to separate.

My amendments make it clear that any waste authority that intends to set rules for recycling must accept all possible plastics, paper and recyclable material. The hon. Member for Northavon is right. Once one starts specifying Tetrapak or the type of plastic, one gets into difficulties. I do not want to do that. I tabled the amendments in this form so that I could provoke a debate. I want at least one of the schemes to suggest that it will collect the residual domestic waste, as the Government have termed it—that is, the garbage, the food scraps, or what has not gone into compost—and take everything else in a limited number of containers.

My worry is that if an authority designs a scheme whereby it charges for the bulk of the garbage left—the residual domestic waste—or the weight of it, that may be legitimate, in order to minimise residual domestic waste either in bulk or in weight. However, if the authority then says, “Aha! We’re going to take only little plastic bottles, and we are not going to take polystyrene. We will not take cardboard or Tetrapak. We will take only the following materials, separated into three or four types”, it automatically forces householders to have a lot more residual domestic waste.

Householders will have to stick the polystyrene, the Tetrapak, the unacceptable cardboard or the mixed bit of plastic and paper into the residual domestic waste. I bought a new printer yesterday and I could not get the plastic off the cardboard. It is difficult to separate some of these things, and one ends up throwing them into the residual domestic waste because one cannot take the risk of putting them into the cardboard or into the plastic.

By being ruthlessly discriminatory as to what they will accept as recycling material, local authorities could design recycling schemes that force people inadvertently to increase the amount of residual domestic waste. Local authorities could then put a charge or tariff on that, which is unfair on householders. My amendments seek to tell local authorities that they cannot do that. If a local authority intends to be ruthlessly tight on the amount of garbage—I apologise for using the American word, but it is easier than “residual domestic waste”—on the food scraps and the bits that have to go into garbage, and if it proposes to penalise or charge householders who produce more than one little bag of garbage, there is a duty on the local authority to say, “However, we will take all the plastics, glass, bottles and cans in three simple boxes, or one multi-recycling container.”

Joan Ruddock (Labour, Lewisham, Deptford)

I think I need to help the right hon. Gentleman. The sort of scheme that he envisages would not happen. That is not the purpose. There is no absolute level of residual waste that a local authority would deem to be the basis of the scheme. A scheme must be based on the total residual waste produced within the pilot area. An average of that would be taken, and the range calculated. There is no absolute, as he describes. When I speak later, I may be able to elucidate further, but the sort of proposal that he makes would not be approved by the Secretary of State.

David Maclean (Conservative, Penrith and The Border)

I am delighted to hear that from the hon. Lady, and I admire her faith in the ability of all our local councils to come up with schemes that have such integrity. That seems to fly in the face of some of the stories in the newspapers over the past few months—not necessarily in the Daily Mail, but perhaps in The Daily Telegraph. Those stories may have been totally untrue, but if the stories about some of the schemes that local councils are imposing are untrue, I would love to hear so. Experience suggests that some of the stories about local authority prescription of the type of containers and receptacles that can be used are, unfortunately, correct.

If the dustbin man—I am not sure of the politically correct term; perhaps refuse-recycling collector-person—comes along to a household and there are 20 different sorts of bins, boxes and collection receptacles outside, that is not acceptable. My amendment says that if local authorities prescribe a type of bin, they should not prescribe a designer-style one, which can be bought only from them, at exorbitant cost. If it is nicked, blown away in the wind or ends up being used in the allotment for more convenient purposes, a replacement has to be bought from the authority, again at exorbitant cost.

Authorities should have a more standard-shape receptacle that the elderly can carry when it is full of bottles and that we cripples can carry when our legs do not work properly. I would like to see schemes that are more helpful—I declare an interest—for the disabled staggering to the garden gate than schemes with all the different sorts of boxes that we must have these days, because it seems that our garbage collection people will no longer come up the garden path to get them. I want to make sure that the local authorities do not build into their schemes conditions that are convenient for them, but are dashed near impossible for the householder in respect of the size, type or cost of the receptacles that may be used.

Another part of my amendment proposes that there ought to be no more than three different types of receptacle. This is not a gross exaggeration by The Daily Telegraph or others. Across local authority areas there seem to be totally different rules about what may go into a box. I agree with the hon. Member for Northavon that the Bill cannot prescribe the details such as thin or thick cardboard, Tetrapak and plastic. I do not want our district councils to do so either, as they are doing at present. There are vast differences in the definition of cardboard and newspaper between Carlisle city council and Eden district council. God help us if we put the wrong sort of cardboard in the cardboard box. It does not get collected and we might get a penalty.

Steve Webb (Liberal Democrat, Northavon)

The right hon. Gentleman is over-egging the case. Unlike ourselves, most people do not live in two local authority areas. Although we might represent areas that cover different schemes, provided that local authorities are consistent and clear, before long, people will know exactly what they are meant to do. Different local authorities will have different schemes, because they have entered into different contracts on different dates and so on. As long as residents are told and it is consistent, why does it matter if different authorities have different schemes?

David Maclean (Conservative, Penrith and The Border)

It matters because there is incredible mobility around an area. They are all our constituents. If we are all trying to come up with a proper recycling initiative, let us get as much standardisation as possible.

Steve Webb (Liberal Democrat, Northavon)

Why?

David Maclean (Conservative, Penrith and The Border)

Because we are trying to move the public and ourselves on to do more and more recycling, it is incumbent upon us to make it as simple as possible. The huge difference in the how local authorities are operating and in their definitions results in the sort of stories that appear in the Daily Mail and The Daily Telegraph and cynicism about all the recycling initiatives. Let us follow the old military term, KISS—keep it simple, stupid. That applies to me, especially.

Several hon. Membersrose—

David Maclean (Conservative, Penrith and The Border)

I give way to my right hon. Friend the Member for Suffolk, Coastal first.

John Gummer (Conservative, Suffolk Coastal)

As one who does not read either The Daily Telegraph or the Daily Mail, may I suggest to my right hon. Friend that there is a much more domestic reason for this? Often, people go and help their old relations who happen to live in the next-door area. I represent the Suffolk coastal area, and many people in mid-Suffolk come and help their aunts or uncles, or people who need their help, and they find it confusing that the two places have totally different arrangements. That is all right for the intelligentsia of the Liberal Democrat party, but there are many people for whom waste is not the most important thing in life. To have to go into the kitchen and read through a list that is totally different from that in another area is just confusing and off-putting.

David Maclean (Conservative, Penrith and The Border)

I agree with my right hon. Friend entirely.

Martin Horwood (Liberal Democrat, Cheltenham)

Will the right hon. Gentleman give way?

David Maclean (Conservative, Penrith and The Border)

I will give way to the hon. Gentleman in a second, I just want to elaborate on this point. I accept that different councils can have different coloured bins, different coloured receptacles and different days for collection. That is okay, that is the great diversity of Britain, but it should not be the case that one authority says, “Ah ha, that cardboard orange juice packet is acceptable because we deem it to be cardboard,” and another one says, “You have committed a criminal offence, you’ve put your orange juice packet from Marks and Spencer into the wrong box.” It is incumbent on us to make the legislation straightforward and simple. Given the difficulties of interpretation that the Committee is finding and the fact that the hon. Gentleman says we cannot put this into law because we cannot start defining what is a Tetrapak or polystyrene because it is too difficult and changes all the time, we will end up in this country with 300 authorities having 300 different definitions of what is acceptable newspaper or card.

Martin Horwood (Liberal Democrat, Cheltenham)

Will the right hon. Gentleman give way?

David Maclean (Conservative, Penrith and The Border)

I promise I will give way to the hon. Gentleman, but please give me a minute to finish this point. As I was saying, it is acceptable to have differences around the country, but those differences should be within certain parameters. It should not be within the parameters for local authorities to so narrowly define newspaper, card, or material that they will not accept, and to do so not because it is not recyclable or they cannot do anything with it, but because they have just entered into a contract with Mr. Snoggins, who will take only—[Interruption.]. Well in that case the council should enter into a contract with Mr. Y, who will take the thicker cardboard or the newspaper.

Martin Horwood (Liberal Democrat, Cheltenham)

Will the right hon. Gentleman give way?

David Maclean (Conservative, Penrith and The Border)

I give way to the hon. Gentleman to shut him up.

Martin Horwood (Liberal Democrat, Cheltenham)

The right hon. Gentleman is clearly enjoying himself. At the risk of encouraging him to go on to a further diversion, does he accept that the Select Committee on Communities and Local Government—or the Committee on the Office of the Deputy Prime Minister as it may have been called when it produced its report on recycling—clearly endorsed the approach that each council should be able to make up its own approach to recycling because the physical environments differ so much? It is one thing to recycle in a rural area, where people may have four wheelie bins, but that is not possible in a suburban area, which may have a box-based system, but even that is not possible in a place that is dominated by flats or multi-occupancy, where people have to do the recycling within their own household or share facilities. That is why we need a diversity of approaches. As my hon. Friend the Member for Northavon said from a sedentary position, different contracts are negotiated with suppliers, which have to be done at best value for local councils and therefore involve different qualities of paper or qualities of recycling. That is why the approaches have to vary. The right hon. Member for Suffolk, Coastal said that people might be confused by different districts having different approaches. The last time I looked, most households were residing in one district. That may not be true of Conservative Members, who have such huge gardens that they cover three districts, but most people do not seem to move.

David Maclean (Conservative, Penrith and The Border)

In essence, what the hon. Gentleman is saying is that the most convenient way for the local authorities and the councils to recycle will be the way that it is done and sod the constituents, sod the residents, who will be left with the residual burden. I accept that local councils may have a different contract to take cardboard or paper, or the most lucrative recycling contract. That is fair enough, but we should be making these pilots based around what is most convenient and best for our constituents, for our householders. What collects the most material for recycling? What breaks the polystyrene problem? Some bins now take polystyrene, but the attitude of the councils has been appalling. They will take the easy stuff: “Bring us your glass bottles and we will recycle them; put them into brown, green, yellow containers. Bring us your easy paper, we will recycle it. Do not bring us your polystyrene as it is too difficult. You are stuck with that and must sort it out. If it is too big, do not put it in a big bag as we won’t take it.”

There is the problem of old mattresses and sofas, which will now pollute the countryside. If the rules are too tight or it is too difficult for householders to get rid of the chunks of polystyrene that come with a new TV or printer, we know where those chunks will end up—in the fields and hedgerows of my constituency. If people cannot get to the recycling tip in the cosy hour that it is available, those materials will be dumped in the countryside.

One of the amendments suggests that recycling centres in the pilot areas should be open more—not 24/7, but perhaps 7-11. If someone finishes unpacking their kit at the weekend after a trip to Ikea or wherever, by 5 o’clock when they are ready to load the car with big chunks of card, the tip or recycling centre has already closed. That is outrageous. If we want innovative ideas, we should build in rules so that local authorities keep recycling centres open later in the evening and accept all plastics and materials.

If we have five innovative recycling pilots, and none take polystyrene and Tetrapak, what is the point? We cannot get rid of those things at the moment. I know nothing about the subject, but any fool can recycle plastic bottles or glass; that is easy. I accept what the hon. Gentleman says and that we might need different rules for the countryside and towns. I am happy with that—we might need different types of boxes and receptacles in the country and the towns, and in blocks of flats. However, householders must be able to get rid of all their recyclable material in those pilot schemes, and not be told that only the easy stuff will be taken as the rest of the plastics, glass, Tetrapak, polystyrene and so on cannot be coped with. That means that people are stuck with it and if they put it into the garbage, the residual waste, it is too bulky and big and they will be clobbered.

John Gummer (Conservative, Suffolk Coastal)

Will my right hon. Friend explain to the Liberal Democrats the very simple distinction between a different method of collection due to the nature of the household, which is for the benefit of the public, and the inability of councils to recognise that unless there are standard assertions about which materials are collected, we cannot get the proper value for that material? We get very little value from many materials because no single council collects enough of that material to make it worth while. That costs the council, as it will not deal with its neighbours and make a joint decision as to what the value and nature of the material should be.

David Macleanrose—

Peter Atkinson (Conservative, Hexham)

Order. Before the right hon. Gentleman replies, I remind the Committee that we had an extensive debate on these amendments on Thursday, and we are in danger of falling behind. I ask hon. Members to bear that in mind.

David Maclean (Conservative, Penrith and The Border)

I am grateful for that advice. If the Government agreed to withdraw these clauses, we could make very rapid progress.

My right hon. Friend is right. The key point I wish to get from the Government is about those “standardised assertions” of what is recyclable material. If that could be standardised throughout council areas, I would not care whether councils insist that they collect glass on a Saturday morning at 3 o’clock, or that the plastic bin has to go out on a Friday at 2 pm, although I would like to see that standardised as well—it seems to be for the convenience of councils and their operatives rather than householders. We should standardise the definitions of what can be put in the ruddy box. If the Minister goes ahead with the pilot schemes, I beg her to make that the main test. It is not about what size box councils have or what day they collect it; the main test of the pilots should be whether councils can standardise their definitions so that we have three recycling boxes at most that can take most of our recyclable material. We should challenge the councils to find another operator that will take the difficult cardboard, glossy paper or Tetrapak products.

I am fed up of going round the supermarkets, practically with my magnifying glass, looking at juice packets and seeing that even Sainsbury’s puts “Not yet ready for recycling” on them, because it finds them too difficult to recycle. If the supermarkets and the councils are finding it too difficult or too expensive, why should our constituents be left with the residual difficulty of, “We can’t take that, guv, it’s the wrong material” or “it’s the wrong weight”? I ask the Minister to try to design the pilot schemes to make it easy for householders to recycle and to recycle nearly everything, so that we have the minimal amount of garbage. Do not base the pilots on an area average.

I thank my right hon. Friend the Member for Suffolk, Coastal, who informs me that it was utterly inappropriate to refer to a “garbage collection man” or a “bin man”, they are domestic environmental collection operatives. I hope that all our domestic environmental collection operatives in future will find it easy to do simple recycling and take away the garbage at least every seven days.

Gregory Barker (Conservative, Bexhill and Battle)

I rise to speak in favour of new clause 22, which we placed before the Committee but did not have an opportunity to debate last Thursday. I am mindful of the revenue-neutrality concerns raised by Committee members when we discussed the last group of amendments on Thursday. While council tax reductions have to be paid for, we should remember that a municipality sending less waste to landfill would be paying less to landfill operators, which we discussed last week when Members rightly questioned how incentives would be paid for. The money saved could pay for the reductions in council tax for ambitious recyclers, and there would be significant savings from reductions in landfill tax being paid to Government.

However, in addition to cuts in council tax, there is another way to incentivise householders without threatening them with a penalty, and that is by paying people to recycle by offering vouchers depending on the amount of recycling waste that a family produces. Those vouchers could be redeemed locally, at supermarkets for example, and would thus go towards reducing families’ costs of living by helping them to pay for daily essentials at a time of soaring food costs. Communities could pool the vouchers to pay for equipment for schools or for the upkeep of parks and green spaces. That sort of market incentive is far more exciting and positive than pay-as-you-throw.

The public will not like the message, “We will fine you if you don’t go green.” “We will pay you to do it” is a better and more positive message. The only incentive scheme allowed under existing legislation is offering council tax reductions in exchange for producing less landfill waste, although, we would like that to be more explicit in the Bill. That is why I have tabled new clause 22, which would legislate for the introduction of such voucher schemes across Britain.

John Gummer (Conservative, Suffolk Coastal)

Will my hon. Friend assure me that the new clause would enable public-private partnerships in cases in which local organisations of all sorts might like to join the local council? That will be a good way for large stores—department stores and the like—to join the local authority in encouraging such schemes and perhaps put money into them so that the vouchers are worth that much more.

Gregory Barker (Conservative, Bexhill and Battle)

Absolutely. My right hon. Friend makes a very good point. The precedents for this kind of incentive scheme are primarily in north America and those partnerships are exactly what have happened. In effect, there have been top-ups in addition to the incremental savings from the value of the recyclates. Other organisations that wish to help to encourage recycling, particularly supermarkets and large retailers, have joined in to help recycle as part of their corporate social responsibility policies and to help drive the creation of viable new markets for recyclates.

A voucher system operator in north America, where a similar scheme operates, claims that recycling rates rise from single figures to, on average, 40 per cent. of household waste in the communities where it has been trialled. Participation in voucher schemes is entirely voluntary, but in north America it averages at 90 per cent. in areas where it has been introduced.

To give a specific example, an initial pilot in two neighbourhoods in Philadelphia included 2,500 households where recycling rates were just 7 per cent. and 30 per cent. respectively. They were two very diverse metropolitan areas. Within two months, recycling rates had doubled in both neighbourhoods, and participation rates rose to an incredibly impressive 90 per cent.

Another example is from Wilmington, Delaware. Participation in the voucher scheme is around 90 per cent., and the amount of waste to landfill has dropped by 40 per cent. This saved the city about $800,000 a year in landfill costs and landfill tax savings. That $800,000 was after the costs of rolling out the city-wide scheme.

Steve Webb (Liberal Democrat, Northavon)

The hon. Gentleman is citing helpful evidence about what others have done. Where does he stand on the apparent inconsistency between what he is saying and what his right hon. Friend the Member for Penrith and The Border argued? His right hon. Friend called for standardisation, no pilots without standardisation and so on, but he is talking about 1,000 flowers blooming. Does he think that such voucher schemes should be bog-standard, fixed and constrained, or should they be varied?

Gregory Barker (Conservative, Bexhill and Battle)

The hon. Gentleman misconstrues what my right hon. Friend is saying. My right hon. Friend and I speak with one voice. We do not want to clobber the council tax payer with penalties and fines in the way that the Liberal Democrats do. We want to offer incentives. The problem is the incredibly complex array of schemes. The average community charge payer is more likely to incur one of the Liberal Democrat fines or penalties if an array of legislation is allowed in.

The strong difference is not between my right hon. Friend and me, but between the Liberal Democrats and us. We favour rewarding people who do the right thing, looking for ways to incentivise communities, and looking for a positive agenda, rather than the Liberal Democrat hair-shirt, bang-people-up attitude, or at least their preference for giving people a fine or a penalty, because it is so much easier, particularly for lazy-minded councils, just to fix a penalty than to consider innovation and reward. Of course, although we do not intend to impose a scheme from the centre, the more uniform it is, the easier it is to understand, and the more comprehensive, the better. That is common sense.

John Gummer (Conservative, Suffolk Coastal)

Will my hon. Friend explain very simply to the Liberal Democrats that it is helpful to people to have standard categories, so they know what to save in the right boxes, and it is helpful then to have as many different ways of encouraging people to do it in as many different places as possible? That is clear, and even if the Liberal Democrats do not get it, most of the public will.

Gregory Barker (Conservative, Bexhill and Battle)

There is no need to tell the Liberal Democrats. My right hon. Friend has just put it so beautifully that I could not improve upon it.

Joan Ruddock (Labour, Lewisham, Deptford)

Will the hon. Gentleman clarify his account of the incentive schemes? Is he saying that there was an increase of 90 per cent. in the amount of material recycled, or that 90 per cent. of the waste was recycled?

Gregory Barker (Conservative, Bexhill and Battle)

I am saying not that 90 per cent. was recycled, but that there was a 90 per cent. participation in the waste recycling schemes, up from 7 per cent. in one part of the city, and 30 per cent. in another.

Joan Ruddock (Labour, Lewisham, Deptford)

Is that what the hon. Gentleman said?

Gregory Barker (Conservative, Bexhill and Battle)

I am confusing myself. I am saying that participation rates across the city rose to 90 per cent., rather than that 90 per cent. of rubbish was recycled.

Martin Horwood (Liberal Democrat, Cheltenham)

Will the hon. Gentleman give way?

Gregory Barker (Conservative, Bexhill and Battle)

Let me get to the logical breakpoint in my argument, then I shall give way. Let us return to the case in point at Wilmington, where the city faced the daunting dilemma of dwindling landfill space. It did not wish to fine anyone to increase recycling, so it used the innovative voucher scheme instead. The head of Wilmington’s public works, the public works commissioner, said:

“We’re not interested in penalties. We’re interested in making it work and getting people involved”.

That is exactly how the Conservatives see the recycling agenda.

Martin Horwood (Liberal Democrat, Cheltenham)

I am glad the hon. Gentleman told us that that was the logical breakpoint. He is indulging in some entertaining political slapstick, for which he will receive due reward from the Daily Mail. To bring him back to the facts, is he interested to know that during the Select Committee’s inquiry into recycling to which I referred, I supported incentives, not fines? I agree with his amendment. At the time, that action got me favourable mention in the Daily Mail.

Gregory Barker (Conservative, Bexhill and Battle)

Am I surprised that the Liberal Democrats say one thing in one Committee sitting and say another in a different Committee? No. That is their standard operating procedure. As for the savings for United Kingdom recycling operations that would accrue from not sending household waste to landfill, councils could make significant savings by avoiding landfill costs.

David Chaytor (Labour, Bury North)

The hon. Gentleman’s argument about the Wilmington experience is interesting. There are always dangers in trying to import directly into the United Kingdom an experiment that took place in the United States. Does he accept that, if the voucher scheme that he described was linked entirely with the larger retail businesses, it would further concentrate the retail market in the hands of the big five supermarkets in the UK?

The last thing that most towns in Britain want is a further concentration of retail share with the big five because that would continue the hollowing out of our town centres. It would also make individual households more car dependent because, to use their vouchers, people would have to drive to the out-of-town supermarket. What would be saved in emissions and might be saved through an increase in recycling would be counter-balanced by increased emissions from having to use the car to drive further to the retail outlet.

What is there in the Bill to prevent one of the five local authorities from submitting an innovative bid on exactly those lines? Is anything blocking that?

Mr. Gummerrose—

Gregory Barker (Conservative, Bexhill and Battle)

If my right hon. Friend will allow me, I shall explain. We want it made explicit in the Bill that such action would be allowed. I do not accept the absolute logic of the assertion of the hon. Member for Bury, North.

John Gummer (Conservative, Suffolk Coastal)

Will my hon. Friend help the Committee by explaining that the Wilmington project was supported not by the local retailers, but a major beverage manufacturer? The manufacturer wanted to take such action. It was a sensible thing to do, and the vouchers could be used at any local shop. That is not the issue. A system can always be organised. We need the opportunity under the Bill for at least one of the tests to be undertaken in that way.

Gregory Barker (Conservative, Bexhill and Battle)

Absolutely. The hon. Member for Bury, North painted an entirely sensible scenario of everything accruing to supermarkets, and that would worry us. However, as my right hon. Friend the Member for Suffolk, Coastal said, food or other manufacturers are equally able to participate in promoting such a scheme. It would enhance the opportunity to recover things like glass bottles from drinks manufacturers and reusable or recyclable packaging products. Although we do not want to get into that level of detail now, I understand his point, but I do not consider it to be a necessary or obvious conclusion that such schemes would put more power into the hands of the supermarkets, to the detriment of local traders.

Finally, I return to the landfill tax and the cash savings that would accrue from recycling within a year to a council that increased the amount it recycled. The landfill tax stands at £32 a tonne. As was announced in the 2007 Budget, landfill tax will rise by £8 a tonne a year until at least 2011, when it will be £48 a tonne. As we are producing about 28 million tonnes of municipal waste a year, the opportunity to avoid the costs of sending the waste to landfill, plus avoiding the costs of paying up to £48 a tonne on landfill tax represents a significant financial saving for councils. I note that the Treasury expects to receive £1.1 billion from landfill tax in 2008-09.

Avoiding such costs should mean that councils are able to pass those savings directly back to the ratepayers through council tax reductions for ambitious recyclers, on the basis that council tax payers are already paying through their council tax to have their waste collected. Any additional savings that the council make as a result of participating in such schemes and diverting waste from landfill should at least be shared with the council tax payers, consistent with our policy that it is right to reward people for doing the right thing, and to do so without penalising non-participants.

Steve Webb (Liberal Democrat, Northavon)

Savings are an important part of the equation. A local authority does not get money; it just does not face an increase in a bill that would otherwise be faced. It is not that local authorities will suddenly have an income stream that they will have to decide what to do with, but that there is a tax with a ratchet effect on it, which they may be able to mitigate, to a greater or lesser extent, by such schemes. Does the hon. Gentleman accept that, although it sounds great in principle, that is not a pot of money that local authorities will have? The rate per tonne is going up and up, They can try and offset it, but the odds are against the net effect being less landfill usage. The scheme would have to be extraordinary to deliver that, would it not?

Gregory Barker (Conservative, Bexhill and Battle)

I understand what the hon. Gentleman is saying, but any responsible, prudent local authority will have to have a financial plan that anticipates paying that charge. If councils are able to beat the financial plan because of the actions of their local council tax payers, they will achieve a saving on their forecast budget. That saving should at least in part, if not in full, be shared with those who are doing the right thing and recycling.

Unfortunately, I am unable to press new clause 22 to a Division. However, I shall seek to press new clause 18, to which I spoke on Thursday and which gives power to local authorities to reduce the amount of tax payable in relation to household waste.

Joan Ruddock (Labour, Lewisham, Deptford)

Let me begin by addressing some of the comments made in the debate this morning.

The right hon. Member for Suffolk, Coastal accused the Government of not tackling waste other than household waste, but we put in place construction-site waste-management plan requirements earlier this year, which will transform the operation of construction sites. The Department for Business, Enterprise and Regulatory Reform strategy on construction waste was published last month.

The right hon. Member for Penrith and The Border spoke of how Westminster deals with its waste, sending it to SELCHP. I cannot comment on the particular processes of that authority, but I can tell him that there are perfectly good mechanical arrangements for separating combined, dry recyclates. Many local authorities across the country satisfactorily separate plastics, paper, metals and glass, collected together, by using plants called MRFs—materials recovery facilities. He said that Westminster sends everything to SELCHP. I cannot comment on the specifics, but it is the Government’s policy that only residual waste remaining after the maximum recycling by a local authority should be sent for incineration. It is true that the SELCHP plant does not currently have heat recovery, but it is looking at whether it can do that in the future. I would support that, SELCHP being in my constituency.

The right hon. Gentleman began by objecting to having these clauses in the Bill at all, but he has made a meal of them.

David Maclean (Conservative, Penrith and The Border)

I took interventions.

Joan Ruddock (Labour, Lewisham, Deptford)

I was glad that he took my interventions because they helped, I hope, with the case that he was making, or not making. He spoke about recycling centres and I agree with him that recycling centres, civic amenity sites—whatever the local authority calls them—should offer a service that is relevant and fits contemporary lifestyles. We have encouraged local authorities to consider carefully the hours at which such facilities are open and how they enable people conveniently to deposit materials for re-use, recovery and recycling. I have recently seen a state-of-the art facility at Reading.

David Maclean (Conservative, Penrith and The Border)

In that case, will the hon. Lady insist that at least or possibly three of the five pilots have 7-11 opening facilities?

Joan Ruddock (Labour, Lewisham, Deptford)

I am sorry to have to tell the right hon. Gentleman, but that is not relevant to these particular clauses. We are considering enabling the local authority to recover more recyclates at the household level. The schemes are to deal with the material that the householder puts in his or her bin, not what they may or may not be taking to the civic amenity site. Taking things to the civic amenity site or the recycling centre is usually done on the basis that what one cannot put in one’s bin is what one takes to the other place. I am giving the right hon. Gentleman that information because he makes a good point, but it is not relevant to these particular clauses or the amendments proposed to them.

The right hon. Gentleman queried what is the point of the pilots if they do not take everything. The point is to increase the participation rate and to increase the quantity of material that is collected. Although he would like, and I would join him in this aspiration, local authorities to collect more and more and more waste streams, none the less it is a fact that not everyone is participating at the moment and not everyone is participating to the degree that they might, so we could collect a great deal more from the doorstep than we do currently.

The right hon. Gentleman said that he would like standard assertions of what is recyclable. The waste resources action programme, which the Government support financially, gives a great deal of advice to local authorities and to manufacturers and retailers, to try to standardise and reduce the number of, for example, plastics that are in use—we do not need the huge range that we have. Virtually everything is recyclable, and that is the direction that the Government seek to follow.

As I have said, local authorities provide many other outlets, if required, for the recyclates that that particular local authority is not collecting, such as the civic amenity site. Retailers are offering more and more big containers on site, so that people are not necessarily using making more car journeys and producing more emissions because they are going to the supermarket anyway, so it can be done all at the same time. Most recently, we have introduced “recycle on the go”, to capture in particular aluminium cans, glass bottles and plastic bottles when people are away from the home. Much is being done.

The clauses are about the collection of household waste where the local authority collects from the doorsteps. The hon. Member for Bexhill and Battle referred to the Wilmington experiment. I was concerned to hear that it was a beverage manufacturer—I hope that alcohol was not being offered.

John Gummer (Conservative, Suffolk Coastal)

No.

Joan Ruddock (Labour, Lewisham, Deptford)

I am glad to hear that. It might have accounted for a tremendous increase in the recycling rate if it had involved bottles of wine or cans of beer. Nobody would dispute that it was a good result but, as I understand, the rate of material that was recycled as a consequence was 40 per cent. We already have local authorities that are at the 40 per cent. level, so we must do more.

Gregory Barker (Conservative, Bexhill and Battle)

The hon. Lady is right; 40 per cent. is not the summit of our ambitions. However, the point is that this was a difficult metropolitan area. This country has some very poor communities that recycle a fraction of their waste—I think especially of Liverpool where the recycling rate is in low single figures, perhaps as low as 3 per cent. During the experiment, recycling in one area went from 7 per cent. to 40 per cent. in a short space of time. It is not the only solution, but it is an interesting scenario.

Joan Ruddock (Labour, Lewisham, Deptford)

Indeed. We will discuss the hon. Gentleman’s amendment shortly.

Amendment No. 108 requires authorities running waste reduction schemes to collect residual waste at least once a week, and to collect all recyclable materials. Clearly, we cannot accept that. It specifies,

“tetrapak materials, polystyrene and all plastics.”.

As the right hon. Member for Penrith and The Border knows, at the moment, such materials are not collected from the doorstep by the vast majority of authorities. Requiring a local authority to operate a weekly collection of residual waste and collect all the recyclables would prohibit the majority of local authorities from coming forward to offer a scheme at all.

David Maclean (Conservative, Penrith and The Border)

I am sorry to interrupt the hon. Lady as I initially spoke for much longer than intended. This is about pilot schemes, not amendments to compel every authority in the land to collect all Tetrapak and polystyrene. I am merely trying to build it into the pilot schemes.

Joan Ruddock (Labour, Lewisham, Deptford)

Indeed, but all local authorities are invited to put themselves forward to undertake a pilot scheme. It would completely distort any schemes that might come forward if that involved moving into a different era and collecting 20 streams of recyclables. [Interruption.] The right hon. Gentleman protests too much.

The other important point, which was raised by the hon. Member for Northavon, is that if we specify that residual waste is to be collected every seven days, no authorities that currently operate alternative bin collection schemes will come forward at all. The amendment is unnecessarily prescriptive and limits the options for authorities. What the right hon. Gentleman proposes would effectively prevent any authority in England from piloting one of those schemes.

Joan Walley (Labour, Stoke-on-Trent North)

I am concerned about what my hon. Friend says in response to the amendments in view of press reports that I read last week. I know that we should not believe everything that we read in the press—that point was raised just now—but I remember reading that the shadow Secretary of State for Communities and Local Government was intending to report local authorities for collaborating on some of these pilot schemes. I am a little unsure about the comments coming from the Opposition with regard to the Department for Communities and Local Government. I wonder if there is a difference between the two shadow Front-Bench spokesmen on that matter.

Joan Ruddock (Labour, Lewisham, Deptford)

My hon. Friend is perceptive. The shadow Secretary of State for Communities and Local Government has spoken frequently about the schemes and threatened Conservative local authorities, telling them not to collaborate with the Government. I am delighted, however, that that is not the attitude of the shadow Environment, Food and Rural Affairs Minister who has joined us in the Committee. It is for that party to sort out what on earth its policies on those issues might be. We have certainly not been able to understand them.

Reference was made to Tetrapak cartons, which have historically been difficult to recycle, but industry is working hard to turn that around. We all hope that that will happen, as they are such an important part of our lives. While we encourage local authorities to continue improving the recycling services they offer, we must recognise the complexities and different circumstances they face on the ground. As the hon. Member for Cheltenham indicated in a intervention, that is very much a case of achieving the commercial contract, and local authorities have to do that and gain an outlet, otherwise there is no point in collecting it.

The powers outlined in the Bill require an authority already running one of the pilot waste reduction schemes to operate a good recycling service. As I have said, that means a service that meets the standards specified for the purposes of that definition in the guidance. The Department has also recently published draft guidance on what constitutes a good recycling service. That proposes that an authority must, as a minimum, offer free kerbside collection of dry recyclates and at least two waste streams. We have also said that additional priority in selecting pilots would be given to authorities that collect plastics and food waste or that plan to do so within 12 months. Food waste was not one of the streams that the right hon. Gentleman suggested needed collection, but I am sure that members of the Committee will have noted the enormous amounts of food waste that we are putting out in this country. Indeed, tackling the amount of food waste has become a priority for the Government.

We believe that the proposals represent a good balance between ensuring that householders within a scheme are provided with a good collection service and that the requirements are not so prescriptive as to limit the types of authority that can participate in the scheme. The key issue is to ensure that the pilots provide us with robust evidence about the impact of incentives on behaviour. We have seen that similar schemes work elsewhere, which is why we want to trial them in England. Excluding large numbers of local authorities from coming forward to undertake a pilot by including over-prescriptive requirements, which is what the amendment would do, would hinder us in the task, so we obviously oppose it.

Amendment No. 109 is nothing but a wrecking amendment, as the right hon. Gentleman must know that no local authority would be able to collect waste from all of the recycling categories that he has specified. The hon. Member for Northavon, when speaking to amendment No. 112, which he tabled, suggested that we should let 1,000 pilots bloom. I think that he will know that that is a slight exaggeration, even of what he proposed.

Steve Webb (Liberal Democrat, Northavon)

A figure of speech.

Joan Ruddock (Labour, Lewisham, Deptford)

A figure of speech, but I reiterate that what really matters in these pilots is that we should be able to retrieve the evidence systematically and analyse and record it properly. That limits the numbers that we should properly put in place. The hon. Gentleman might have an opinion that there should be more pilots, but we have decided that five is appropriate, and I ask him to accept that we need a robust and useful evidence base for deciding whether to roll out those powers to other waste collection authorities. If he thinks that all authorities ought to have the opportunity to do that, that is for a later stage in the proceedings.

Steve Webb (Liberal Democrat, Northavon)

I cannot understand why the Minister needs to tie her hands with legislation. It is almost as though she does not trust herself, as if she has to pass a law to stop herself saying yes to six. Surely she should see what she gets in, and if there are six damned good ideas, she should take six, and if there are four, she should take four. Why does she have to pass a law to ban herself from doing something that she might want to do?

Joan Ruddock (Labour, Lewisham, Deptford)

I have a great deal of confidence in myself, thank you very much. We wanted to settle on a number, and we put that number in the Bill. That gives clear certainty to local authorities. It is also a case of looking to what financial support will be provided. If we had a completely open-ended number, we would have to have a completely open-ended budget. There will be financial support from the Government. We want to get the evidence. We believe that we can do it. I am sure the hon. Gentleman would agree that it would be impossible anyway to test every conceivable type of scheme in every conceivable type of authority.

Steve Webb (Liberal Democrat, Northavon)

Six.

Joan Ruddock (Labour, Lewisham, Deptford)

The hon. Gentleman says six, but someone else would say, “Yes, but there are already four types of scheme and 20 types of demography”. The hon. Gentleman should accept that we have decided on five. We certainly will not have an open-ended number, as he proposes in the amendment. That will be resisted.

Amendment No. 107 would prevent the Government from making any regulation that would create a criminal penalty on any householder for non-compliance with any aspect of a waste reduction scheme. Unless I am mistaken, that amendment has not been spoken to. I will not tempt the right hon. Member for Penrith and The Border. He might like to be tempted. No, his colleagues say that they would not like him to be tempted.

David Maclean (Conservative, Penrith and The Border)

I did not speak to that amendment. Similarly, I did not address in detail some of the other amendments. I got so bogged down by interventions on the principle of the clauses, and on some of the minutiae, that I did not test it. I shall not attempt to speak to it now in a brief intervention, but I support the concept underlying the amendment. I do not believe that householders in a pilot test should get criminal penalties if they make a mistake.

Joan Ruddock (Labour, Lewisham, Deptford)

I am glad the right hon. Gentleman made that point. Iit is appropriate for the record that I deal with the amendment, even though he did not. I am sorry to tell him that he failed to notice that there is no provision in the Bill to use any regulation to create any criminal penalty. I hope that with those few words he will be entirely satisfied. I echo the comments made by my hon. Friend the Member for Stoke-on-Trent, North. The right hon. Gentleman has probably been reading too many of those press releases from the hon. Member for Brentwood and Ongar (Mr. Pickles), who is always saying that people are being made into criminals by the proposals for proper waste collection policies.

Our advice to local authorities is that they should first communicate well with their citizens and explain clearly what is expected in response to waste collection policies, and that they should not need to have to penalise people. However, where people will not accept the advice and will not co-operate, the provision exists for the fixed penalty notice. That is what local authorities can issue. As the right hon. Gentleman knows, a fixed penalty notice does not make a person a criminal. I am sure he has occasionally had a fixed penalty notice himself, not in respect of waste, but perhaps in respect of a vehicle. He would be unusual if he had not.

David Maclean (Conservative, Penrith and The Border)

I may have picked up many fixed penalty notices for parking offences, and they were richly deserved where the evidence was clear. Who will judge whether a householder has got it wrong with recycling? Will the hon. Lady tell us the type of mistake that could lead to—I am glad that it will not be a criminal record—a fixed penalty? Would those mistakes include putting the wrong sort of card or paper in the wrong box?

Joan Ruddock (Labour, Lewisham, Deptford)

As I explained to the right hon. Gentleman, communication between local councils and householders is crucial in all these things, leaving aside the pilot schemes authorised by the Bill. If people put materials in the wrong bins, the council should explain what they are supposed to do. I expect councils and those who operate their policies to understand the position of the householder.

We would all expect common sense to prevail. For example, if a blind person made such a mistake, a fixed penalty notice would be inappropriate. We need common sense, courtesy and proper communication. We know perfectly well that some people persistently do the wrong thing after receiving an explanation and having been treated politely. Some people are abusive to the refuse collectors. A line must be drawn at some point. That is how I believe we should proceed.

David Maclean (Conservative, Penrith and The Border)

We are getting into rather dangerous territory. I am glad that we are pursuing this line of questioning. I take the point that only a crazy local council would penalise a blind person. That is an extreme example. I am more concerned about the millions of householders who have to deal with something that appears to be a cardboard box and do not realise that it is lined with plastic or foil, as with a Tetrapak.

I come back to the point that I have been making. If we do not have simple, standard definitions that are advertised by the Government in a national campaign, we will catch millions of innocent householders. They might not be blind, they might have perfect sight and they might be reasonably intelligent, but they still might not realise that the material in their hand is the wrong sort of material. They might not realise that their little district council will refuse to collect it and penalise those who put it in the wrong box. That is the mischief.

Joan Ruddock (Labour, Lewisham, Deptford)

I remind the right hon. Gentleman that the general point about waste collection is that we all have to do more and we all have to learn to do it better. In the vast majority of cases, common sense prevails and such difficulties do not occur. If we cannot decide on these things, councils will not be in a better position.

David Maclean (Conservative, Penrith and The Border)

It will not stop them.

Joan Ruddock (Labour, Lewisham, Deptford)

Well, in general, common sense prevails and these things are dealt with appropriately.

To come back to the Bill, we are talking about only five pilots. Perhaps this is a case in point for the Liberal Democrat amendment tabled by the hon. Member for Northavon. In the pilots, we will work closely with the local councils through the Waste and Resources Action Programme to give advice and ensure that the communications work. We will test some of the hypotheses put forward by the right hon. Gentleman in a proper way.

Under the existing mechanism local councils can issue fixed penalty notices. It is not Government policy to make non-payment of a waste charge a criminal offence. Under the regulation-making powers we cannot create criminal offences for non-payment of a waste charge. On the basis of that reasoning, I am sure the right hon. Gentleman will be pleased to withdraw the amendment, as it is superfluous.

On new clause 18, I agree entirely with much that the hon. Member for Bexhill and Battle said. Of course we want to give people incentives, to learn from the practices undertaken elsewhere and to do all we can to incentivise and increase recycling. However, new clause 18 is a puzzle. It would not remove schedule 5, which might have been a logical move. Instead, the new clause would be additional to the powers of the schedule. As the hon. Member for Cheltenham pointed out, what is proposed can already be done under the Bill. We therefore do not believe that the new clause is needed.

John Gummer (Conservative, Suffolk Coastal)

We have been trying throughout, with a certain amount of amusement in between, to reach a consensual answer on the issue. The crucial matter is that there are modern means of encouraging people to do things, which are more attractive to many households than the traditional ways of reducing council tax and all the rest, because they are immediate and fit in with other things that householders do, with television and the like.

I hope the Minister will undertake to ensure that at least one of the pilots would try to use a voucher system or something similar, to see whether that raised the participation of a wider range of families. We should not allow the whole business to become the purview of particular kinds of families from particular backgrounds. In the work that I have been doing, I have found that the most difficult thing is how to increase recycling in, for example, disadvantaged areas. It may be that the mechanism before us would have the effect in this country that it has had in the United States.

Joan Ruddock (Labour, Lewisham, Deptford)

I am grateful to the right hon. Gentleman for that intervention. If I may, I shall explain our attitude to the new clause in a logical sequence and then come to his point. It seems to make little sense to allow waste disposal authorities to require billing authorities to reduce council tax, while requiring that the waste disposal authority should reimburse the billing authority for both the lost council tax revenue and the costs of bringing the scheme about, which is what is proposed. It seems unlikely that a waste disposal authority would ever choose to do that.

The provisions for linking rebates and charges made under an incentive scheme to council tax are set out in schedule 5 and already allow authorities to net rebates off council tax bills. The rebates and charges made under a scheme are designed to incentivise sustainable behaviour on waste. There is no need to consider changes to the underlying council tax liability and it is not Government policy that the schemes should do so. I need to set that on the record because it has not been debated. The provisions in the Bill and the framework that we intend to establish in regulations will ensure transparency and fairness for householders, and will ensure that councils may link the administration of their scheme to council tax if they wish. We will consult fully on the detail of the regulations relating to council tax. We do not believe that anything more is required.

I turn to the issues about which the hon. Member for Bexhill and Battle spoke. He wants only reward schemes under the Bill. As I said at the outset, such schemes can be established under the proposals in the Bill and, perhaps even more significantly, do not require new legislation. Right hon. and hon. Members may not be aware that DEFRA has already carried out major incentive-only and reward-only schemes involving a significant number of authorities. There were 53 fully reported trials, of which 30 found that they had a positive impact in increasing the tonnages of recyclables collected. I am pretty certain that those reward-only schemes included vouches in some cases. I may need to check whether they were actual vouchers or prizes, as it were, but there was not a council tax reduction or anything of that kind. They did not have a monetary value.

John Gummer (Conservative, Suffolk Coastal)

I am sorry to have introduced the matter rather earlier than I ought to have done. I apologise to the Minister. I want her to be very vulgar.

Joan Ruddock (Labour, Lewisham, Deptford)

Could I be vulgar?

John Gummer (Conservative, Suffolk Coastal)

I would like the Minister to be vulgar. The problem with the whole issue is that we forget that most people find it boring, not terribly interesting and not essential to their lives. We, who are involved, have become much more interested in it. How do we make people keen on it? We should use mechanisms that those selling mass-produced, household goods learned about long ago. Vouchers should be available that are used in the same way as “buy one, get one free” offers. I want to make sure that we go down that line, and that people can take something into a shop and get something cheaper because of it. I do not mind what sort of shop or circumstance, but please can we make sure that that is an element of what we are trying to do? I know about the earlier schemes, but they were tentative and slightly nice. We want a bit of vulgarity, and the Minister to be straight down the line as if she were the marketing boss of a major soap company.

Joan Ruddock (Labour, Lewisham, Deptford)

I am intrigued by the right hon. Gentleman inviting me to be vulgar. I hope that I am not capable of doing that, but I shall obviously try.

Whatever the right hon. Gentleman thinks about the schemes and their being timid or not, there were a lot of them. Local authorities came forward and volunteered to undertake what were a considerable variety of schemes. All I am saying to Conservative Front Benchers is that such a scheme has been tried in this country. We saw a rise in recycling in 30 of the 53 trials. There was a positive impact, but the difficulty was that the magnitude of the increase varied widely. It was hard to separate out the extent to which the particular reward, rather than the education, information and exhortation, increased recycling rates. As the scheme took place some years ago, rates were much lower, so there was greater scope for easy increases.

Gregory Barker (Conservative, Bexhill and Battle)

Apart from exhortation and education, a key role is played by the mechanism for collecting recyclates. If it is overly complex or requires too much effort on the part of the consumer, take-up will suffer. I urge the hon. Lady to look at the pilots in the USA—and perhaps not at the historic examples in which DEFRA has taken part—to see how the combination of vouchers plus effective collection produces such positive results.

Joan Ruddock (Labour, Lewisham, Deptford)

We have looked extensively at north America and its different schemes, such as the rewards-only and the rewards-and-charges schemes, as we have at continental Europe. I shall make a point of looking at the example that the hon. Gentleman gave of Wilmington, how long it has been happening and how sustainable it is. Participation rates can be raised easily and quickly by giving people vouchers, but how is that sustained for years on end? Where do the commercial interests lie in offering the rewards and vouchers? How sustainable is that? Does it raise competition issues in due course? Many factors would have to be considered if a scheme was based entirely on a commercial interest being allied with a public service. We must be sustainable and constantly increase recycling rates, not just have a burst of activity with a good result. We need to do more.

Having considered all the research, I was advised strongly that, if we want to increase recycling rates substantially and in a sustainable way, we need to look to the continental and north American examples that involve both rewards and charges. That is why, informed by all that research, we have brought forward proposals to try out five pilots in this country.

John Gummer (Conservative, Suffolk Coastal)

I ask the Minister to remember where her advice is coming from. It is coming from people who are universally unconnected with private industry. She is being advised by civil servants who, charming and able though they are, have specifically chosen not to be part of the private sector. She is being advised by local authority people who are in the same position. The American example is very interesting. In fact, it is sustainable, and is the basis of a now nationwide provision. It is supported by major companies and it really has a result.

I do not suggest that the Minister should take this on alone. I merely say that it would be silly if we produced an exciting idea but did not find a way of testing it ourselves. There is a worry about where our advice comes from. When I was in her position I had no idea, because there was a certain filtering of information, how much was being done commercially in both continental Europe and the United States. I hope that we will be given the opportunity to do this. I do not care two hoots who does it. I want to achieve it. But this line of vulgarity is important because otherwise the expansion of recycling is restricted to particular sections of the community, which is a great sadness.

Joan Ruddock (Labour, Lewisham, Deptford)

I hope that we can satisfy the right hon. Gentleman. We will clearly look at all the schemes that come forward. As he said, we may need to do some additional work ourselves in order to inject some further ideas into the process. I am more than happy to consider that. He would be entirely wrong, however, if he thought that I spent all my time talking to civil servants and people from local government. I have a significant number of meetings with entirely commercial interests. The civil servants involved also have a great deal of dialogue, particularly in these fields, with manufacturers and retailers. There is no ideological reason for us to be opposed to the sort of proposition that the right hon. Gentleman makes.

This is where we are. We believe that we need the possibility of pilots that involve both rewards and charges. That is the provision in the Bill, but it does not mean that we cannot do reward only—I must make that absolutely clear. All moneys raised in charges must be returned to residents as a whole, so that the overall burden on householders will not increase. That is an important point. Using words such as “penalties” and “fines” suggests that it is a new imposition on residents as a whole. It certainly is not. It is a reward-and-charge scheme and a rebate-and-charge scheme, in which no moneys accrue either to the Exchequer or to local government. That is a very important point.

New clause 18 does not introduce any useful new powers. New clause 22 removes the current provisions which allow authorities to issue rebates and charges to householders according to the amount of waste that they throw away, thereby permitting reward-based schemes only. As I have just said in relation to new clause 18, schedule 5 already allows authorities to run such reward-only schemes. Rebates could be netted off council tax bills or paid to householders directly. Indeed, the powers also allow for other types of financial payments, including vouchers, which new clause 22 specifically seeks to allow. As neither new clause 18 nor new clause 22 would replace schedule 5, but would merely add superfluous material, they must both be opposed.

David Maclean (Conservative, Penrith and The Border)

Before my hon. Friend the Member for Bexhill and Battle perhaps chooses not to press the amendments in my name, I want to say a few concluding words. The Minister asked whether I would be pleased if we chose not to pursue my amendments, and I am not pleased at all, but that may not prevent me from declining to press them further.

Amendment No. 109 is not a wrecking amendment—none of my amendments on the amendment paper are intended to wreck the Bill. We are talking about a pilot scheme, and I have tabled probing amendments outlining what I thought were genuine pilot schemes. I agree with the hon. Member for Northavon that it is daft to restrict ourselves to just five schemes, when we could have four or six or seven. Yes, there is a cost involved, so we cannot have 200, but why restrict ourselves to five if they are pilot schemes?

I thought that the pilot schemes were intended to test not only the financial charging and penalty mechanisms, but whether councils could do the difficult recycling tasks that the rest of us cannot do. Instead, all that we have heard is that they will test charges, rebates and fixed penalties for householders who do not get things right. Local authorities will therefore not be encouraged to introduce pilots to deal with the huge amount of stuff that we cannot recycle—the Tetra Paks of this world. I am not totally obsessed with Tetra Paks, except in the sense that when I go to recycle them, nobody wants to take them. I cannot put them in the cardboard box, the foil box or the plastic box. If I go to the recycling centre, warnings tell me not to stick them in any of the containers.

Local councils have got me running up and down the stairs sorting out all their rubbish for them, and we the householders are doing their dirty work by putting our recycling into separate boxes, but when it comes to the difficult stuff, they just do not want to know—they do not want to take the things that they find it difficult to recycle. In my ignorance, I had assumed that at least one or two of the pilot schemes would test volunteer councils that came along and said, “We’ve got a system for dealing with the polystyrenes of this world and with the composite materials—the cardboard and the foil together and the plastic and the paper together. Minister, can we have a go at testing it out because we can take the stuff that most other councils aren’t taking? Here’s our charging regime.”

Joan Ruddock (Labour, Lewisham, Deptford)

A council will be perfectly free to say that it wants to do that in its pilot. Its proposal might be the most successful if it offers much more. Everything is possible.

David Maclean (Conservative, Penrith and The Border)

I am delighted to hear it, but that was not the message that I got from the Minister earlier. She suggested that our proposals would be rejected because they would compel every council in the country to recycle everything. Of course, I do not want the provisions and the pilot schemes to do that, but we must draft such probing amendments to explore the Minister’s intentions in Committee.

I will happily sit down now if the Minister tells us that the pilot schemes will offer positive encouragement to councils—it may be one or two councils—to come forward with ideas about how to recycle the stuff that most councils do not want to touch because it is too difficult to handle. We must solve that problem. There is no point in the Minister introducing five schemes if they test only the charging incentives, the penalties and ways of clobbering the local community charge payer. Surely a pilot scheme must test the mechanics to see whether councils can recycle stuff that others cannot.

My right hon. Friend the Member for Suffolk, Coastal is right that there is a danger that the whole recycling issue will get stuck not in a class system, but with the people who are already attuned to it, who are already recycling and who probably already have a lower carbon footprint. The issue should not be the preserve of puritanical liberals—luckily, we do not have too many of them in my constituency. We know what puritanical liberals are like: they put their plastic bottles through the dishwasher to make sure that they are clean, they put their wet newspapers through the tumble-dryer to get them dry, they load everything into their diesel Volvo and they go down to the recycling centre. If that is what turns them on on a Saturday night, good luck to them, but there are more exciting things to do in Hexham and Penrith. [Interruption.] My right hon. Friend wanted vulgarity and he has got it.

The serious point—I apologise for that excessive levity—is that we must make things easier for people. I am getting fed up with recycling. I believe in it, but I am getting sick to the back teeth of having to separate everything out and do the council’s dirty work when it will not take the stuff that I find it most difficult to cope with. What is the point of a district council if it cannot deal with those things, even on a pilot study?

The Minister has heard my plea. If the clauses need a slight tweaking on Report, I beg the Government to give her the flexibility and the freedom to have four, six or seven pilots, and to have some pilot schemes that will deal with the rubbish and the recycling materials that no one else wants. She will have my full support. I am happy to go along with my hon. Friend the Member for Bexhill and Battle if he wishes to withdraw my amendments, on the basis of the firm assurances from the Minister.

Gregory Barker (Conservative, Bexhill and Battle)

I will not detain the Committee. We feel strongly that there should be a far more explicit statement on the face of the Bill about the power to reduce the amount of tax payable in relation to household waste, so we propose to press new clause 18 to a vote. I beg to ask leave to withdraw the amendment.

Peter Atkinson (Conservative, Hexham)

The Opposition have asked for a vote on new clause 18. That, of course, will come later in our proceedings.

Joan Ruddock (Labour, Lewisham, Deptford)

I beg to move amendment No. 24, in schedule 5, page 74, line 21, leave out paragraph 3 and insert—

‘(1) Section 46 of the Environmental Protection Act 1990 (c. 43) (receptacles for household waste) is amended as follows.

(2) After subsection (1) insert—

“(1A) Where—

(a) subsection (1) applies to a waste collection authority, and

(b) a waste reduction scheme under Schedule 2AA to this Act is in operation in the authority’s area,

the authority may require the occupier to place the waste for collection in receptacles identified by such means as may be specified.

(1B) A requirement under subsection (1A)—

(a) must be imposed by notice served on the occupier;

(b) may be imposed instead of, or in addition to, any requirement imposed on the occupier under subsection (1).”.

(3) In subsection (10) (interpretation), in the definition of “specified”, after “subsection (1)” insert “or (1A)”.’.

(4) In subsection (6) (penalties for failure to comply with requirements under subsection (1) etc) after “subsection (1),” insert “(1A),”.

Peter Atkinson (Conservative, Hexham)

With this it will be convenient to discuss the following:

Government new clause 5—Collection of household waste.

Government amendment Nos. 25 and 26

Joan Ruddock (Labour, Lewisham, Deptford)

The amendments refine an amendment that was made during the Bill’s passage in the other place. Our intention was to enable waste collection authorities to run waste reduction schemes where residents buy tags or stickers to place on their waste receptacles, either waste sacks or bins, when they put them out for collection. Residents would then receive a flat rate rebate. People buying the most tags would pay more overall, whereas others who had bought fewer tags would make a net financial gain. To allow for such schemes, we made an amendment to the Environmental Protection Act 1990 to give authorities the power to specify in a notice to residents under section 46 of that Act how they should identify their waste receptacles—say, with a specific tag or sticker.

That would apply to all waste collection authorities, which was not our intention. The amendment would avoid the unwanted impact and clarify that the power to specify how waste should be identified should be available only to those authorities running a waste collection scheme.

Following the pilots, as the Committee knows, the Government will report back to Parliament and will consider whether to roll out to all authorities in England powers to make a waste reduction scheme available. Should the powers to implement such schemes be rolled out in future, the power to specify how waste should be identified would continue to apply only to those authorities operating a waste reduction scheme.

I turn now to new clause 5. My noble Friend Lord Rooker mentioned during the Bill’s passage in the other place our intention to table an amendment to clarify that once a local authority has informed residents how they should present their waste for collection, such as by putting it in a bin, the authority need not collect any waste left lying outside the bin, for example. In the business, such waste is normally termed “side waste”.

As explained then by my noble Friend, these sorts of policies have been successfully operated by a significant number of authorities, with the support of their communities, using powers conferred by the Environmental Protection Act 1990. As part of a good overall service, they have helped householders to reduce the waste that they throw away, and to increase the amount that they recycle. We have not made any change to existing policy, but we think it would be helpful for local authorities and for residents to have a single clear point of reference in legislation. That is why we tabled Government new clause 5, which would apply to all waste collection authorities in England and Wales.

Anne McIntosh (Conservative, Vale of York)

Would the provisions permit councils whose current policy it is to allow side waste to continue to do so?

Joan Ruddock (Labour, Lewisham, Deptford)

The hon. Lady is probably referring to situations where the way in which waste should be collected is specified, but householders put out additional waste and the collection authority willingly takes it away. Authorities would obviously be able to do that. They are not being dictated to, but are being given a power. It is our understanding that the power exists at present.

Local authorities can refuse to take away the side waste because they have made a specific provision under a section 46 notice. However, some local authorities choose to take waste that is additional to the bin or system that they use. That is their choice. There are, however, quite a lot of authorities which say, “We issued a notice. We made it clear what you are required to do. You must not put out more waste.” The Bill will clarify what we believe to be the case already—that they have the power to refuse.

The hon. Lady still frowns, but I hope that what I said is clear. Our reason for tabling the new clause is to make it clear that all waste collection authorities are covered by the relevant provisions. They need not collect waste that is placed for collection in a way that contravenes the collection requirements set out by the local authority in a notice to residents. That may seem unnecessary and complex, but it is intended to make the law absolutely clear.

Government amendment. No. 25 is consequential to Government new clause 5 on the collection of household waste. The amendment adjusts the Bill so that its provisions on the collection of household waste extend to England and Wales only. Similarly Government amendment No. 26 adjusts the long title of the Bill to reflect the inclusion of the new provisions.

Gregory Barker (Conservative, Bexhill and Battle)

I note from the Minister that the amendments seem primarily to be of the tidying-up kind. She answered my hon. Friend’s query, but we need to probe a little into the ostensibly innocuous nature of the provisions and consider their exact intention a little further.

Amendment No. 24 is an amendment to schedule 5, which in turn makes changes to section 46 of the Environmental Protection Act 1990. For the benefit of those without the Minister’s mastery of the legislation, can she clarify the significance of the 1990 Act, how it relates to the waste section of the Climate Change Bill, and the effect that the amendment will have on the operation of the Bill and the 1990 Act?

Government new clause 5 would also change section 46 of the 1990 Act. The text to be inserted looks somewhat less innocuous than that in amendment No. 24. It reads:

“A waste collection authority is not obliged to collect household waste that is placed for collection in contravention of a requirement under this section.”

Such phrases can set alarm bells ringing all over the country, particularly where residents have experience of particularly officious waste collection regimes, so can the Minister assure me that the inclusion of the amendment will not mean that people will get out of bed in the morning to find that their rubbish has not been collected, on the grounds that they put the bag 1 m in the wrong direction, it was a few grams too heavy, or for some other pedantic reason?

John Gummer (Conservative, Suffolk Coastal)

The proposal worries me a great deal. We should be passing legislation for the benefit of the customer, and not of the provider. This sounds like bureaucratitis of the worst kind. It says, “I am the local authority, I am going to decide what is convenient for me. You are going to do it and, if you don’t, I have no duty to collect your waste.” That is precisely the attitude of Government that people are getting tired of. It is an attitude that has become more pervasive over recent years, and this seems to be a prize example. The provision is too tight and I do not like the feel of it at all. I suspect that our constituents will not like it. I know what will happen. Mr. Jobsworth will be around from the local council, saying, “Wrong place, wrong type of product. I’m afraid we can’t take it. And what’s more, they’ve just moved the law so that we can tell you that if you don’t put it out in the right way, we don’t take it.”

Gregory Barker (Conservative, Bexhill and Battle)

My right hon. Friend has his finger on the pulse of the public, as ever. In my area many elderly people are worried about such regulations. There has been the experience of bins not being collected from time to time by new operators. Particularly when there is a change in operator and a switch from one system to another, people take a while to get used to it. Sometimes waste is not collected, even though the householder has behaved entirely sensibly.

Anne McIntosh (Conservative, Vale of York)

Will my hon. Friend take the opportunity to press the Minister further? I am not entirely satisfied. My right hon. Friend the Member for Suffolk, Coastal has struck on a problem. The amendments make the system much less flexible than the present one. There are people who work away and who are not able to put out their rubbish on the collection day, but have come to an arrangement. There might be pressing security reasons why that cannot be done. Could my hon. Friend press the Minister further about the Government closing down a degree of flexibility and making matters more difficult, which will lead to more fly-tipping?

Gregory Barker (Conservative, Bexhill and Battle)

Absolutely. That is expressed across the country, where new regimes and new contracts are coming into force, ending the flexibility that many householders used to have with their dustman and the relationship that they used to have with him, which found expression at Christmas. There was often a personal relationship with him. [Laughter.] No, not the milkman. [Laughter.] From a sedentary position, the Minister has broken the habit of a lifetime and been rather vulgar. However, I will rise above it.

All I am saying is that customs have grown up locally where householders were on good terms with their dustmen, ensuring flexibility in the collection of rubbish. I would hate to see such arrangements compromised by tightly worded legislation such as this. I have lost my line of thought.

Joan Walley (Labour, Stoke-on-Trent North)

I am sure that the hon. Gentleman is about to return to his text, but I would like him to confirm that this is a serious issue.

Gregory Barker (Conservative, Bexhill and Battle)

We are looking for flexibility and common sense in the interpretation of the law, to make sure that we are not creating a charter for jobsworth officialdom.

David Maclean (Conservative, Penrith and The Border)

My concern is not just, as my hon. Friend said, the jobsworths coming around and dictating what they cannot take and so on, but what will happen to the stuff that they do not take. We are not referring to people who, when they are supposed to be putting out their garbage or recycling, dump a sofa or mattresses. What will happen to the little bags? What happens if a person puts out extra newspapers in the wrong box—a whisky box or a wine box—instead of the official council plastic box? Such a move will inevitably be fly tipping. I would like to have reassurances that if householders put out extra, legitimate, material on the right day, it will not end up being thrown over a hedge into a farmer’s field in the countryside.

Gregory Barker (Conservative, Bexhill and Battle)

My right hon. Friend makes another valid point. We want to hear the Minister say that she takes on board such common-sense concerns and that a common-sense regime and culture will not be superseded by an exact charter and a legalistic interpretation of the rules and regulations. We hope that common sense will continue to prevail.

Martin Horwood (Liberal Democrat, Cheltenham)

I do not know what the story will be in tomorrow’s Daily Mail, but I think that I know what it will be in The Sun.

Amendment No. 24 is astonishing, in that we have to produce a piece of legislation to permit a local council to ask someone to put a sticker on a bag in its local authority area. It is a measure of just how ridiculously centralised this country is that the amendment is before us and that 20 Members of Parliament have to discuss special clauses to allow people to put stickers on bags. If the Minister insists that it is necessary, we have to take it at face value.

In all seriousness, I share the concerns of other hon. Members about amendment No. 24. The Minister is right that councils can already refuse to collect waste under certain circumstances. I have had one such experience. Having been told to shred my confidential waste paper, I was then told that I did not have the right to have it collected for recycling. In the brave new world of the right hon. Member for Penrith and The Border, I suppose that it would have been collected anyway and that it would have clogged up all the recycling machines.

David Maclean (Conservative, Penrith and The Border)

If the hon. Gentleman shredded his confidential papers, why did the council refuse to collect that for recycling? Was it in a plastic bag?

Martin Horwood (Liberal Democrat, Cheltenham)

A paper bag. I gather that the dust generated by shredded paper affects the machinery. There was a technical reason why it could not be done. Such realities have to intrude on the debate occasionally. The alarm that I have is that there is a difference between shredded paper and what is generally known in the trade as putrescible waste, which is something that I learned about on the Select Committee. That is where the concern of the public starts to get real along with that of environmental health officers and others. I would hate to think that we were compromising any important public health principles in the name of recycling and that we were inadvertently placing people, such as the elderly and those in a confused state, at risk of having their welfare compromised by well intentioned provisions aimed at allowing councils to enforce recycling schemes. I guess that the scenario could be positively Neapolitan if things went badly wrong. I am seeking reassurance from the Minister that even after the measure has been passed, there will still be sufficient protection in other legislation or regulations to protect vulnerable citizens and ensure that public health is protected as strongly as it has been.

Joan Ruddock (Labour, Lewisham, Deptford)

In response to the final remarks of the hon. Member for Cheltenham, I give him every assurance that this is not a new measure—I have been at pains to stress that before. At the moment, local authorities issuing a section 46 notice can specify how waste will be collected from a residence. Once they have done that, if people do not comply, they may refuse to take away the additional waste. As I said in relation to the intervention made by the hon. Member for Vale of York, that does not mean to say that they will refuse, but they may refuse. If there were any risk to public health, they would have to collect. This provision already exists; local authorities may refuse to collect and some do.

There have been some questions about this. We have put clear provisions in the Bill to make it obvious that this is the law and that the power exists. The waste section of the Bill in schedule 5 will insert new schedule 2AA into the Environmental Protection Act 1990. I think that I have answered the points made by Back Benchers.

Clause 70

Anne McIntosh (Conservative, Vale of York)

I will take this opportunity to correct the record. When we debated clause 69 on Thursday, I was recorded in column 334 of the Official Report as saying “clause 60”. I will ensure that that is corrected.

I will press the Minister on a couple of points so that she can respond to some criticisms that have been made. We have had lengthy debates last Thursday and today on why five pilot areas have been designated. Subsection (4) will give the Government the power to change the pilot areas. Does that mean that there can be additional pilot areas or that a pilot area can be substituted? Is five the maximum? How does she envisage subsection (4) being interpreted?

The Minister will recall that the Communities and Local Government Committee report described the thrust of clause 70 as a “massive retreat” because it will limit the number of recycling incentive schemes to just five local authority areas and because the Government have capped the amount that local authorities may offer as incentives or take-in charges. Perhaps the most serious criticism is that it delays any possibility of England-wide schemes until after 2012-13. Is she confident that the Government will be able to introduce an England-wide scheme before that date? What date do the Government have in mind? Does the clause mark a departure from the Government’s waste strategy along the lines suggested by the criticisms, or does the Minister believe that the clause is in keeping with the strategy?

I have had a little read of “Erskine May”, as one does from time to time. Subsection (5) will exclude the prospect of an instrument being treated as a hybrid instrument. Is that a standard procedure? I am sure that the Minister will find that help is at hand. The Commons is not as used to this procedure as the Lords because hybrid instruments are largely used in the Lords. Such instruments give the public the opportunity to petition. I do not know whether that could be seen as a delaying tactic, given the strength of feeling about clauses 69 and the amendments to it. What was the thinking behind the Government’s seeking to exclude the possibility of a hybrid instrument?

Joan Ruddock (Labour, Lewisham, Deptford)

The hon. Lady is correct to suggest that I might require the help that is at hand in dealing with her final point about hybrid instruments. I have looked at the provision and taken a briefing on it, but as we are in a formal Committee, I will read what is provided to me in due course to be on the safe side.

The hon. Lady referred to the Communities and Local Government Committee report, which said that the clause was a “massive retreat”. Everyone who has spoken has indicated that these are subjects on which people feel strongly. We have considered, therefore, that moving immediately to the roll-out of schemes across the country would be premature, given the controversy that they have generated. That is why we thought that it would be much better to start with pilots and to have a limit of five pilots. In no way does that go against our waste strategy, as outlined a year and a half ago. We said that we would create such powers and they are being created, albeit by beginning with piloting.

The Government have said that we want to have substantial results from those pilots before proposing any roll-out and that we want a parliamentary debate on those results, so the timing could be as the Committee has suggested. That is not a huge problem because we are already on target for the 2010 requirement under European law to reduce the amount of waste going to landfill, and we believe that we can achieve the 2013 target. It is beyond that time that we know we will have a huge challenge to meet the 2020 targets. If the schemes were to be rolled out within that time frame, it would be a way of rising to the challenge of the difficulties that face us regarding the 2020 target for the reduction of waste going from households to landfill.

On the issue of capping the amount that could be charged, although we have not really been referring to charges, based on the schemes that we have studied from overseas, the indicative amount that might be charged would be of the order of £50 over a year. That is not a huge amount. As I said previously, there has been a great deal of excitement about this, which has come primarily from the hon. Member for Brentwood and Ongar, and it has been suggested that we could be talking about £1,000 a year. We want not only to make it clear that that is ludicrous, but to reassure people by saying that we will take the power to cap in case any local authority wanted to propose anything that was unreasonable.

I am now getting the advice that I need, although there is much of it—[Interruption.] It keeps coming, so I do not know whether the opinion is changing. I am told that hybrid procedures do not state that there will be full public consultation, if that helps anybody. If a scheme does not start, a designation order can be revoked and another designated in its place—that is the precise answer to the question about changing where a scheme is. Apart from as provided for under that power, only five may be designated.

It is reasonable to remind the Committee that we are talking about five pilots, not a scheme throughout the country, so the question of the hybrid procedure would relate to a small number of cases. I confirm that such an instrument would allow the public to petition. There is no doubt that that could result in the process slowing down. However, of course, there will be full public consultation on all the secondary legislation proposed.

Clause 71

Anne McIntosh (Conservative, Vale of York)

The Minister referred last Thursday to £2 billion of PFI credits available for waste infrastructure, and said that there is no prohibition on any form of scheme. Some incinerator schemes are coming forward, and there is an additional £10 million available for anaerobic digesters. She said:

“It is now accepted that no serious health effects result from incineration.”——[Official Report, Climate Change Public Bill Committee, 3 July 2008; c. 333.]

I beg to differ with the Minister’s conclusion. Waste strategies are coming forward in each local authority, and several include heat in some shape or form, whether that is straight incineration or not. I repeat the request that I made in connection with clause 69. In relation to the provision for a report or review in clause 71, and an interim report in clause 72, will the Government elaborate on what was said at column 333 so as to end the public disquiet on that form of waste reduction?

I do not know if the mailbags of other hon. Members reflect my own, but in the Vale of York, at any mention of heat, a local action group is immediately set up—outside the confines of the Committee, I could show the Minister five ongoing campaigns. In relation to the reports, will the Minister use her good offices to have a public discussion and end public disquiet about the matter?

Joan Ruddock (Labour, Lewisham, Deptford)

Unless I am wrong, the hon. Lady is not dealing with any provision that exists in clause 71. Those reports are about the pilots. What she talks about has nothing to do with waste collection; it is to do with waste disposal and incineration—she refers to heat, but I think that she means incineration plants.

Anne McIntosh (Conservative, Vale of York)

That is a form of waste reduction. It means sending less to landfill. Does the Minister say that none of the pilots will look at anything other than recycling?

Joan Ruddock (Labour, Lewisham, Deptford)

The pilots are about incentivising behaviour and the way that householders separate household waste into recyclables and residual waste. The destination of residual waste is a decision for the disposal authority. In some cases, that is the same authority as the collection authority, in others it is separate. Those decisions do not relate to the provisions in the Bill. I responded to the points, but they remain outside the provisions of the clause. I will write to the hon. Lady about where to find information that can satisfy the public about the safe operation of incinerators.

Schedule 6

Martin Horwood (Liberal Democrat, Cheltenham)

I beg to move amendment No. 1, in schedule 6, page 75, line 38, leave out subsection (2) and insert—

‘(2) It is the duty of the Administrator to ensure that only renewable transport fuel that—

(a) causes or contributes to the reduction of carbon emissions over its total lifecycle from planting or production to use, and

(b) contributes to sustainable development and the protection or enhancement of the national or global environment generally,

qualifies as a permitted fuel under this Act.’.

If we were in any doubt as to whether terms such as “renewable” and “sustainable” are used loosely, it has been clarified by the debate about biofuels, which are a clear example of something that is renewable—all biofuels are from a renewable source—that can be unsustainable. Most hon. Members will know of examples of wheat grown in north America that requires so much energy to be grown, fertilised and transported—

Joan Ruddock (Labour, Lewisham, Deptford)

Maize.

Martin Horwood (Liberal Democrat, Cheltenham)

I am sorry, the Minister is right to correct me. That maize requires so much energy that it may be making a contribution to climate change rather than tackling it. There are examples of deforestation in other parts of the world that might be making way for the production of otherwise sustainable biofuels. Yet this is an area where there is a potential for CO2 reduction, and I am sure that many of us have examples of sustainable approaches to biofuels, using algae or switchgrass, or more energy-intensive crops such as sugar beet—provided that they are not grown on deforested land. There is also short rotation coppice, with willow in the UK. In my constituency, a company called Green Fuels sources local reused cooking oil and turns it into biodiesel. That is a very sustainable approach to providing transport fuel.

However, we are in a fast-moving policy landscape, as the Government would like to call it. Only yesterday, the Secretary of State told the House of Commons in the context of the Gallagher report, that

“Professor Gallagher also concludes that there is a risk that the uncontrolled expansion and use of biofuels could lead to unsustainable changes in land use, such as the destruction of rainforest to make way for the production of crops. That might, in turn, increase greenhouse gas emissions, as well as contributing to higher food prices and shortages. The Gallagher report therefore concludes that the introduction of biofuels should be slowed until policies are in place to direct biofuel production on to marginal or idle land and until these are demonstrated to be effective.”—[Official Report, 7 July 2008; Vol. 478, c. 1169.]

And lo, within 24 hours an opportunity arises in this Bill to make such a policy change, through amendment No. 1 to schedule 6 on the renewable transport fuel obligation.

We are operating in the context of wider European policy, including the 2003 directive that mandates European nations to increase the proportion of road fuels from renewable sources to 5.75 per cent. by 2010, and the imminent renewable energy directive, which may raise that target to 10 per cent. by 2020. We agree with the Government’s statement, although it has come late in the day, that action is required at EU level to modify that imminent biofuels target and to place a moratorium—I would say—on biofuels targets until we have strict sustainability criteria in place. Yet the Government have pressed ahead with some policy in their own right, including the renewable transport fuel obligation introduced in April.

It is possible—although not necessarily likely—that the EU directive might not be agreed before April 2009, and that even if the push for a change in EU policy fails and the directive comes in we might be allowed to develop stricter criteria. Such criteria might not prevent the importation of other biofuels—I gather that that would be prevented under the directive—but they might provide the basis for the kind of regime that we have seen in other sectors, where labelling and public information might lead to more sustainable procurement policies being implemented by businesses or Departments. Nevertheless, we might still be able to contribute to a more sustainable policy on biofuels.

The Secretary of State said yesterday that she had done the two main things that this Government seem to do on environmental policy. One is to commission a report—she has done that and it was clear in its conclusions. The second is to begin a consultation—she will formally consult on slowing down the rate of increase in the renewable transport fuel obligation. In her concluding remarks, she also said that

“I will not hesitate to alter our policy if that is what the science suggests is appropriate.”—[Official Report, 7 July 2008; Vol. 478, c. 1171.]

This seems a golden opportunity to do just that. If we cannot do it in this Bill, I would like to hear from Ministers what exactly the Secretary of State meant by altering Government policy as opposed to EU policy. Could the biofuels targets be amended, and could we introduce conditions such as those in amendment No. 1, which link fuel not only to the physical fact of renewability, but to the actual

“reduction of carbon emissions over its total lifecycle”,

which is the kind of sustainability criterion that we want to see throughout Europe? Is such a measure permissible and technically possible within Government policy at the moment, even in the context of European policy? We hope that it is, and that it will give us freedom to pursue a more sustainable policy on biofuels, even if European policy is moving slowly in that direction.

Gregory Barker (Conservative, Bexhill and Battle)

I am delighted to have the opportunity to speak to this amendment, and I congratulate the hon. Gentleman on tabling it. I should first like to remind the Committee of events that took place in Committee Room 11, down the corridor, on 23 October last year, when a Delegated Legislation Committee met to vote on the renewable transport fuel obligation. Despite the fact that the Government’s own briefings admitted that

“There is currently no internationally agreed definition of a ‘sustainable biofuel’, nor a working standard that could be imposed”,

the Government Members on the Committee proceeded to vote in favour of making the RTFO law. The only MPs on that Committee to vote against the RTFO on the grounds that it had no sustainability criteria attached to it were from the Conservative party—the Liberal Democrats abstained—so the RTFO became law.

I am therefore delighted—genuinely pleased—that the Liberal Democrats have looked more closely at the issue and that they have clearly decided that things must change. Although I am happy to support the amendment, it is a shame that we could not have halted the RTFO in its tracks earlier.

What exactly does the RTFO require? It stipulates that all fuel suppliers must ensure that 2.5 per cent. of their sales in the UK come from biofuels from April this year. That figure will rise to 5 per cent. by 2010. The RTFO is designed to help bring the UK into line with the European Union biofuels directive, which sets targets for all EU countries to achieve biofuels usage rates of 2 per cent. by the end of 2005 and 5.75 per cent. by the end of 2010. A failure to ensure that such a vast amount of renewable fuels are obtained sustainably will negate any positive efforts to tackle climate change that such biofuels will supposedly bring, as the hon. Gentleman suggested. The notion of destroying vast swathes of pristine rain forest in a bid to protect the environment—

Peter Atkinson (Conservative, Hexham)

Order. I remind the hon. Gentleman that we are discussing the general functions of the administrator in relation to the schedule. We are not having a wide-ranging debate on biofuels. Members’ comments must relate to this schedule and the duties of the administrator.

Gregory Barker (Conservative, Bexhill and Battle)

I stand admonished, Mr. Atkinson.

We believe that such a notion is unacceptable. The current reporting requirement and the Government’s hopes to have mandatory sustainability standards in place by 2011 are not sufficient safeguards to protect the environment. By 2011, we will already have sold more than 5 billion litres of biofuels in the UK. Therefore, on what I rightly assert to be a moral principle alone, I repeat now what my party colleagues said in Committee Room 11 more than eight months ago: we cannot allow the Government, who up till now have shown little or no regard for the impact of biofuels imports on the environment, to set targets for biofuels with no statutory requirement for sustainability. That is why I am happy to support the amendment, which would place a sustainability requirement for the RTFO on a statutory footing.

John Gummer (Conservative, Suffolk Coastal)

I am reminded that amendment No. 1 is narrowly drawn. It is not about the generalities of biofuels, but about the role of the administrator. I am sure that Members would agree that the role of the administrator is of considerable importance in the light of the growing understanding of concerns about the origins and derivations of biofuels. I declare an interest: for many years our company has been working with the largest manufacturer of biofuels from used fat. Indeed, we helped to develop the modern techniques that make that a very successful procedure. As should be the case when one declares an interest, I know a bit about the subject, and I support the Liberal Democrat proposals. If the presumption is not tested clearly that biofuels are better than mineral oils and that they do more for the environment than the equivalent fossil fuel, we bring the whole process into disrepute. That ought to be our main concern. It is very important to make that distinction, and I have indeed sought do so for a very long time.

I do not blame the Government, because it was difficult to get biofuels taken seriously, and that has not been helped by the way in which they have been seen, first, as the be all and end all, and the answer to every possible prayer—maidenly or otherwise—and, secondly, by the same people, as precisely the opposite. It is said that there is no good biofuel to be found. Sometimes, those in the campaigning movements should pause awhile and recognise that it is not satisfactory to march people up to the top of the hill, and then march them down again. A little more careful consideration in the first place and a little less precipitate action in the second place, might make it easier for those of us with responsibilities to get a bit nearer the truth. It might also help us to avoid the “I told you sos” from the climate change sceptics, such as the Daily Mail, and all other trouble makers in this area. I hope, therefore, that those from the green organisations who read the report of this debate will recognise that they have not helped the debate about biofuels one little bit.

Phil Woolas (Labour, Oldham East and Saddleworth)

I agree with the right hon. Gentleman. If I wanted to use taxpayers’ money, I would cross-reference the addresses of people who wrote to me in favour of biofuels with the addresses of those who wrote to me recently against biofuels. But I shall not waste the taxpayers’ money.

John Gummer (Conservative, Suffolk Coastal)

That temptation arises on many occasions. I am glad that the Minister has rightly fought against temptation, but I know exactly what he means—the same is true of other things in life.

We must therefore try to make the Bill the most sensible answer possible. It goes against a lifetime’s experience to say this, but I think that the Liberal Democrats were right to table amendment No. 1—they know that that is my general view. It is right to make the changes that they have proposed, first because this is a matter of life cycles. It is quite a difficult thing to do, but at the same time it is essential. One cannot say that particular biofuels from particular sources are always as beneficial in one circumstance as another.

Let me give an example: biofuels produced close to the point of use are likely to have a lower carbon footprint than those produced a very long way away that have to be carried a long distance, although not necessarily. A biofuel source may be much more carbon intensive if the fuel is produced using a particular process rather than another way. A lot of research has shown that to be true.

I commend to the Minister the work of Low Carbon Vehicle Partnership, which he supports. That partnership has produced some good work on which we can base our judgments. I was sad that the Government found themselves unable to use its work from the beginning on the renewable transport fuel obligation. I hope that they can use it now and the amendment will enable it to be used.

Subsection (2)(b) of the amendment would widen the tone of the phrase by using the words “enhancement”, “protection”, “national or global environment” and “generally”. They are all useful additions that would help to achieve what the Government really want. I hope that the Government feel that they can take that on board.

Finally, the amendment is valuable because it would add to the administration of the system—a point that you, Mr. Atkinson, drew our attention to earlier on. That is important because we must move to a world in which we take these matters into account automatically and without a second thought, so that this is not some great new operation stuck out there, but simply the way that we think and the means by which we move forward. It is what my mother used to refer to as “good habits”. There is a lot to be said for doing things the right way all the time. I shall put it bluntly: people who find themselves in extremis revert to type, so it is valuable for them to have good habits. When something crops up that they did not expect, I want the default mode of a society and a Government to be, “This is how we behave and this is the mechanism that we always use”. Therefore, I congratulate the Liberal Democrats for tabling the amendment, because it not only makes the point that needs to be made, but sets an example about how we ought to behave in all circumstances.

We should ensure that the two elements are measured—first, the life cycle, so that we know what the carbon footprint really is; and secondly, how it contributes to sustainable development, not only to the protection of, but to the enhancement of both the national and the global environment. All that should be seen not just in specifics, but in generalities. Therefore, I hope that the Government will find this a suitable amendment to accept. I know that it is always difficult to accept amendments but, after all, this one is in line with their own thinking.

David Maclean (Conservative, Penrith and The Border)

May I say how relieved I am that my right hon. Friend has moved away from exhorting the Minister to be vulgar and is extolling the virtues of his mother’s good habits. The Committee will be on safer ground if we stick with the latter—not to mention the habits of any dustbin men. I rise generally to support, if not the amendment, the thrust of what has been said by my right hon. Friend and the hon. Member for Cheltenham. The Minister may say that the amendment is not necessary, because proposed new section 125A(2) of the Energy Act 2004, on page 75, already does what the amendment would do and that the Government intend to ensure that the administrator promotes only good biofuels.

A few years ago, I was one of those who thought that biofuels could do no wrong, but I was wrong to think that. I was perhaps looking at the issue from a Cumbrian or a United Kingdom perspective. I looked at the acres and acres of set-aside and at the weeds and thistles and thought, “Goodness me, why are we promoting that? I know that there’s a wildlife element involved, but can’t we grow biofuels there instead?” I was looking at the issue from the perspective of what we could do in our localities to grow indigenous British crops closer to home and convert them into biofuel, because I thought that was a better alternative to leaving land fallow or set aside. In those circumstances, there was a place for biofuels, and I called for more of them to be produced in Cumbria, so that we did not need to have a plague of ghastly wind farms, like a noose around the neck of the Lake district.

In the past few years, however, I have seen certain countries cut down their original, primal rain forests to grow sugar cane to convert into biofuels, and I therefore joined the school of thought that believes that biofuels can do no right. That, too, is wrong, and I suspect that the truth lies somewhere in between, as my right hon. Friend the Member for Suffolk, Coastal said. It is utterly wrong to cut down original rain forests to grow short-term crops—sugar cane or date palms for palm oil—that are then converted into biofuels and transported hundreds of thousands of miles around the world.

Colleagues on both sides of the Committee will be relieved to know that I am not going down the old biodiversity and rain forest speech route again, but it is a million times better to keep rain forests intact and preserve our biodiversity than to cut them down for biofuels. It is better for our carbon footprint to let them grow ad infinitum and then to let them rot and grow afresh than it is to cut them down—that immediately releases carbon—than to grow short-term crops for biofuels that do nothing to reduce our carbon footprint.

All that I want from the Minister is an absolute assurance that, even if the Government will not accept the amendment, the administrator will take into account the thrust of what the hon. Member for Cheltenham and my right hon. Friend the Member for Suffolk, Coastal have said and will promote the supply of transport fuel using biofuels only if those biofuels have not been produced by destroying a better crop, such as primal rain forest or our upland bogs and peatlands, which have locked carbon in.

I have no objection to using biofuels if they are from short-term coppice or myriad other crops that I have never heard of and do not understand, if they come from close to home and if they do not involve a huge number of whatever the equivalent of food miles is—I suppose that the term would be fuel miles. Similarly, I have no objection to biofuels if we do not cause more destruction or release more carbon into the atmosphere to create the modern environment to grow short-term biofuel crops. That is not the way to go, and I look forward to the Minister’s assurance.

Phil Woolas (Labour, Oldham East and Saddleworth)

It is nice to see you back in the Chair, Mr. Atkinson. Let me say at the start how grateful I am to my right hon. Friend the Secretary of State for Transport for making the statement on the Gallagher review to the House before we got to the amendment. I would like to say that that was a consequence of my Machiavellian and detailed planning, but I have always believed in the cock-up theory, not in the conspiracy theory. Seriously, however, it is good for the Committee that we are debating the amendment after the statement on the Gallagher review, because I suspect that right hon. and hon. Members would have smelled a rat and seen a conspiracy where there simply was not one.

The schedule and therefore the amendment are not about the rights and wrongs of the renewable transport fuel obligation. As you rightly said, Mr. Atkinson, they are about an amendment to the way in which the administrator works. However, the amendment tabled by the hon. Member for Cheltenham is helpful in that it addresses the instruction to the administrator on how we may improve the confidence of the consumer and show that, under the scheme, biofuels are sustainable. That is the intention of schedule 6, in which we have made amendments that build on the policy and improve its functioning in exactly the area on which the hon. Gentleman tabled his amendment. It is about increasing sustainability and, with it, consumer confidence, let alone the environmental sustainability that we are all in favour of.

I agree with the hon. Gentleman and I can give an assurance to the right hon. Member for Penrith and The Border that the Government agree with the policy behind the amendment. I have a problem with the amendment, which I will explain, if I may, Mr. Atkinson, but with your permission I shall briefly outline the purpose of the schedule before addressing the amendment specifically, otherwise I may lose the thread of the argument.

The changes to the renewable transport fuel obligation that we are advancing in the schedule are designed to enhance the operation of the order to give increased flexibility, but they are not essential to the operation of the RTFO. We are not debating whether that goes ahead, but talking about how it works. Under the schedule, a number of changes are made to the provisions of the Energy Act 2004, in order to improve it.

Proposed new section 125 would replicate the existing provision for setting up a non-departmental public body and appointing it as the administrator, so it preserves the effect of the order appointing the Renewable Fuels Agency. Proposed new section 125A would place a new duty on the administrator of the scheme to promote the supply of renewable fuel, which delivers carbon savings and contributes to sustainable development or general environmental protection. There is consensus on that point throughout the Committee. We want to use schedule 6 to improve the instruction to the administrator to ensure that there is sustainability. The amendment tabled by the hon. Member for Cheltenham goes a little bit further and, as I said earlier, we agree with that policy.

Of course, we acknowledge the point that the right hon. Member for Suffolk, Coastal made about the worries about some biofuels and the production methods relating to some biofuels, but we do not wish to throw the baby out with the bath water. We recognise that to encourage research and development in future generations of biofuels, it is necessary to help create a market for existing biofuels so long as they are sustainable, as far as is humanly possible.

Proposed new section 125B would enable the Secretary of State to give written directions to the administrator about the use of any power that the administrator has, under an RTF order, to require information from fuel suppliers or to specify the form of the information or the period within which it is required. That power enables us to instruct the administrator to provide and report on the information that all of us want to see.

That is an abridged version of the rationale for the new schedule. Let me turn to amendment No. 1, tabled by the hon. Member for Cheltenham. I have already said that the Government agree with the policy behind the amendment. Let me take Committee members through the reasons, which I hope will satisfy them, why we do not want the specific wording. I strongly believe that I can convince the Committee that we are getting to where the hon. Gentleman wants to be, but by a route which, because of the European Union interest that he mentioned, gets us to the right place.

The criteria and methodology for demonstrating the carbon saving and sustainability of the products is complex. I do not want to hide behind that. We are committed to certification and sustainability criteria. The amendment would introduce a requirement under law that affected entitlement to certificates for the selling of biofuels and, consequently, the biofuels market. It would not define what is required. Without an amendment to the Renewable Transport Fuel Obligations Order 2007, of which the hon. Member for Bexhill and Battle reminded us, to provide the necessary definitions, the law would be uncertain. It would therefore be left to the courts to decide on the criteria and the methodology.

My fear is that such uncertainty about the validity of certificates issued in the meantime could be used by those opposed to what we want to achieve to undermine the scheme. I think there is a consensus that the criteria and method for measuring carbon savings and sustainability should be set on a European Union-wide basis because we wish to create an EU market for good biofuels, rather than going it alone. It is an area where there is a self-evident benefit from an EU-wide policy.

My problem is that, at present, the European Union criteria and methods are being developed. I am advised that the EU law falls under the technical standards directive, which we strongly support. It is not something that Europe is imposing on us against our will. That will never happen. I want to make it clear that we support that because it is in our interests to have a biofuels market that it is EU-based. The technical standards directive does not currently allow member states to implement legislation that covers the same ground.

Under the directive, UK law setting carbon and sustainability requirements, including the amendment and other associated amendments to the 2007 order, would be subject to a stand-still period to prevent its implementation for at least 12 months to enable the EU criteria to be agreed and adopted. Furthermore, if we were unilaterally to introduce the criteria and method in the United Kingdom, it might be difficult to ensure compliance with EU trade rules. That is a subsidiary argument, but one that I put before the hon. Member for Cheltenham.

If the amendment were accepted, it would be legally ineffective until such time as the EU carbon-saving and sustainability requirements are adopted, at which point it would be superseded. My argument to the right hon. Member for Penrith and The Border is not the usual ministerial contention that the amendment is not necessary because it is covered anyway, but that it is not necessary for different reasons. First, it would be ineffective for a year and, secondly, when we have the EU policy, it would be superseded.

Martin Horwood (Liberal Democrat, Cheltenham)

The Minister makes a technically accurate and important point that was made also in another place. I referred earlier to the possibility of the EU’s legislative timetable not going according to schedule and the directive not being adopted before the next European elections in June 2009. That raises a different scenario, which the hon. Gentleman should address.

Phil Woolas (Labour, Oldham East and Saddleworth)

I congratulate the hon. Gentleman on his argument and research. I admonish myself for not reading out the advice at the beginning of my speech, which covers the point. I was handed the paper before lunch—or dinner, as we say in Lancashire.

The hon. Gentleman has a point. The United Kingdom cannot set mandatory standards unilaterally. They need to be agreed at EU level. We have already set a reporting mechanism within the law. What we are trying to do is to set out the requirements to the providers to report on the criteria, as our building block towards the European Union policy. That is as far as we can go before the EU adopts the policy.

The hon. Gentleman may be right, but I would ask him to consider the point that, in the circumstances to which he referred, we would be in the right position by following my argument, because we have established the reporting mechanism. We can slow down the RTFO levels through United Kingdom secondary legislation. My right hon. Friend the Secretary of State for Transport announced a consultation on that point. We are following the route suggested by the hon. Member for Cheltenham.

Let me use another argument, that of the third party, which is from the noble Lord Teverson, the Liberal Democrat in the House of Lords. A similar amendment was tabled, fairly, by the Lib Dems in the other place. In response to my noble Friend, Lord Rooker, Lord Teverson said:

“My Lords, I thank the Minister for his extensive reply”—

mine has clearly not been as extensive—

“which I have to admit was very persuasive.”

He went on:

“I am fully persuaded. The irony, as the Minister well knows, is that the whole biofuel debate moves at a faster rate than political dialogue.”—[Official Report, House of Lords;18 March 2008; Vol. 700, c. 239.]

The noble Lord Teverson was persuaded by the argument that I have put. I hope that the hon. Member for Cheltenham is, as well.

John Gummer (Conservative, Suffolk Coastal)

I am entirely persuaded by the Minister’s argument, but does he not have to put forward a further argument? In the discussions in the European Union, we are faced by those who want to advantage some internal production of biofuels, for reasons nothing to do with sustainable development, climate change or anything else. It is important for him to be able to show clearly that he has been entirely within the law in his position. He will need to argue with those who want to produce biofuels from rape oil in France and from soya beans in Germany for entirely agricultural and electoral reasons—nothing to do with the real issues of climate change. He must show that he has treated the issue with great seriousness, because he might have some pretty tough discussions to get the final results that he and we want.

Phil Woolas (Labour, Oldham East and Saddleworth)

I am grateful to the right hon. Gentleman for providing another bullet in the chamber, if I may put it that way. He is right. He raises a practical point. Let me try to amplify it for the hon. Member for Cheltenham, in an attempt to convince him of the force of my argument.

By signing up to European Union law, the UK is not able to implement unilaterally our own mandatory carbon and sustainability standards while the draft directive that I mentioned is being negotiated. That is because of the overlapping subject matter. The requirement proposed in amendment No. 1, tabled by the hon. Member for Cheltenham, and changes to the RTFO order to implement that, would have to be notified to the Commission under the technical standards directive and would be subject to a stand-still period.

The stand-still period is expected to be 12 months, as set down in the technical directive. It would, incidentally, be extended to 18 months, if during the 12 months the Council adopted a common position on the draft directive. Therefore, if unilateral UK action was proposed, by the time the applicable standstill period finished, the renewable energy directive would very likely—I would say almost certainly—have been adopted and its provisions would supersede the proposed UK legislation. That is a new point for the hon. Member for Cheltenham to consider.

I am pleading with the hon. Gentleman. Although the Government agree with his policy, we think that schedule 6 is the best way to get to it. Schedule 6 beefs up the instruction to the administrator. The danger—if that is not too strong a word—with the hon. Gentleman’s amendment and the amendment in the other place is that they could pull the rug from under us, although we agree with their policy. I rest my case, as it were.

Martin Horwood (Liberal Democrat, Cheltenham)

I am pleased by the degree of consensus in the Committee today and I am particularly pleased by the congratulations from the right hon. Member for Suffolk, Coastal, whose expertise on these issues and record on environmental issues generally are to be respected. I therefore forgive him for his earlier party political pot shots, in this new spirit of cross-party co-operation.

As the right hon. Member for Penrith and The Border rightly said, we have all been on a bit of a journey on the subject of biofuels. I think that it was the Secretary of State for Transport yesterday who slightly unkindly quoted the right hon. Member for Witney (Mr. Cameron), who only a couple of years ago made the definitive statement:

“Five per cent. of all fuels sold in the UK to come from biofuels is a start, but it is a minimum step: we will need to go further in the future.”

Like the right hon. Member for Witney, we have modified our position.

Gregory Barker (Conservative, Bexhill and Battle)

What my right hon. Friend the Member for Witney (Mr. Cameron) said is entirely possible. If one talks to scientists about the developments in biofuels, such that science and technology are employed to use the whole plant, it is entirely possible, and certainly conceivable, that we could be that ambitious, but not if biofuels are grown unsustainably. My right hon. Friend would always insist that they are grown sustainably, so I am afraid that it is a canard.

Martin Horwood (Liberal Democrat, Cheltenham)

I am not sure that I remember the right hon. Member for Witney saying that to the Renewable Energy Association. However, we are on common ground in the belief that much more robust sustainability criteria are needed. Nevertheless, it is important not to throw out the biofuels baby with the bathwater.

The right hon. Member for Suffolk, Coastal and others were a little unkind to members of the green movement and some of the non-governmental organisations that have been lobbying us, implying that they have simply switched position. Those of us who regard ourselves as members of the green movement have been accused on various occasions of holding an almost religious fervour about some causes, such as nuclear power and genetically modified foods, and of never being prepared to change our position. Well, this is a very obvious standing rebuttal of that accusation, because on this issue the consensus in the green movement has shifted. Therefore, the right hon. Gentleman’s accusation was a rather simplistic one.

Peter Atkinson (Conservative, Hexham)

Order. Before I call the hon. Member for Cheltenham, may I say to the Committee that the business on the Floor of the House is likely to run without a vote until just before 6.50 pm? After that, when the Bill starts on its Committee of the whole House stage, there will be a series of Divisions. Members of the Committee may think it more convenient to make some progress before that time, because otherwise the latter stage of this Committee will be disrupted.

Martin Horwood (Liberal Democrat, Cheltenham)

I was just extolling the virtues of cross-party co-operation and of the green movement generally. I shall move on to the specifics of the amendment.

As the Minister said, there is some common ground, and he was good enough to welcome the essence of the policy in our amendment. He was right to say that the status of the RTFO itself is not at issue. Interestingly, he said that what we seek to do is to give instructions to the administrator to ensure the sustainability of the fuels involved. The amendment proposes to use the word “ensure” instead of the current word “promote”, making the instruction in law to the administrator much stronger and more powerful.

In that sense, I am completely with the Minister. He suggests that amendment No. 1 introduces that requirement without sufficiently clearly defining it. He said that that might introduce uncertainty over the validity of certificates and that the criteria should be EU-wide. That is true and we agree with that, and we agree with sufficiently robust criteria being adopted at European level, as we have said. There is no shortage of definitions of sustainability around biofuels.

The Swiss Government already have a working scheme in which they have clearly defined measures of sustainability. The Environmental Audit Committee studied that scheme when we examined the issue. The Gallagher report also goes some way towards defining it. Professor Gallagher made the statement that it should be possible

“to establish a genuinely sustainable industry provided that robust, comprehensive and mandatory sustainability standards are developed and implemented.”

Professor Gallagher thinks that that is eminently possible, and goes on to make specific recommendations including

“the replacement of volume or energy based targets with comparable greenhouse gas saving targets as soon as practicable”.

There is a degree of consensus already available.

We then came on to the rather more technical and legal point. It is right to raise the point that the noble Lord Rooker raised in another place: that, in effect, there would have to be a 12-month standstill period for this regulation, and that it might in the end contradict EU trade rules. If all those scenarios came to pass and the renewable energy directive was adopted on time, the amendment might be ineffective because it would have to wait for the EU rules to be adopted and then it would be superseded.

That is the argument that my noble Friend Lord Teverson thought was so impressive in the other place. We have reflected together on the matter and realised that it is dependent on the renewable energy directive being adopted. That was the technical point that I put back to him, to which he said that I “might be right”—I think that I am quoting him correctly. I think that I am right. He said that policy cannot be set unilaterally because of the overlap of subject matter, but that is not true because the renewable transport fuel obligation itself is a unilateral piece of policy that is already adopted ahead of the renewable energy directive coming into force. I fear that I am not persuaded to withdraw my amendment.

Clause 78

Phil Woolas (Labour, Oldham East and Saddleworth)

I beg to move amendment No. 27, in clause 78, page 36, line 43, after ‘acquire’, insert

‘and dispose of units or interests in’.

Peter Atkinson (Conservative, Hexham)

With this it will be convenient to discuss Government amendment No. 28

Phil Woolas (Labour, Oldham East and Saddleworth)

Having failed to persuade the hon. Member for Cheltenham of the force of my argument, I will attempt to redeem myself by seeking consensus on amendments Nos. 27 and 28. These are minor, technical amendments. Clause 78 allows the Government and the devolved Administrations to purchase carbon units which, at the moment, is not allowed. Those could be used to help meet the targets in the Bill or to offset emissions from the central Government office estate.

I will explain the underlying legal position. The purpose of the clause is not to give Ministers and Departments the power to buy and dispose of carbon units—they can already do that under general law in the same way that I and other hon. Members have the inherent power to buy and sell things. We do not need an Act of Parliament to give us that power. However, if this Bill becomes an Act, the purchase of units could become a source of significant and ongoing expenditure. By convention, parliamentary approval through such a clause is needed to authorise such expenditure. The position is slightly different for the Welsh Ministers who, unlike other Ministers, have only those powers conferred upon them by statute and the clause is necessary for that reason.

Amendment No. 27 broadens that power and allows for the acquisition and disposal of carbon units and interests in carbon units. Interests in carbon units includes the ability to enter into futures contracts to acquire units at a later date based on a fixed price at the date of the agreement. It also provides the power to dispose of carbon units or interests in them, and will ensure that the UK and devolved Ministers have the power to buy and sell carbon units or contracts relating to them. That power exists anyway and this is not a debate about first principle. However, given that the power to acquire them is expressly mentioned, it made sense to put the point beyond any doubt.

Martin Horwood (Liberal Democrat, Cheltenham)

I will speak briefly. I sense that the amendment was not drafted in the Department for Environment, Food and Rural Affairs, but that it might have originated somewhere rather closer to No. 11 Downing street. It has the sniff of Treasury bean counting about it. When considering the pros and cons of offsetting, the Treasury has been remarkably immune to environmental arguments. However, at the prospect of Ministers squirreling away funds for their disposal outside of Treasury control, it has suddenly become interested.

This is an interesting amendment that may be technically and legally necessary and I shall not oppose it. I would be interested to hear the Minister’s response on its origins and the rationale for it in relation to the Treasury.

Gregory Barker (Conservative, Bexhill and Battle)

I understand from the Minister that the clause is an enabling clause that allows the Government and the Departments to buy carbon credits to offset their emissions. If my reading of the amendment is correct, it enables Departments to sell carbon credits, as well as purchase them. That might be a rather cursory summary, but if that is the principle behind the amendment, we support it.

A few questions still need to be answered. First, the amendment will add to the ability to dispose of carbon credits the power to acquire them. This might simply be a matter of legal language, but will the Minister explain if anything is meant by disposing of the units, other than selling them? If the Government had the power to dispose of them in some other way, such as by nullifying or invalidating them, that could seriously affect the carbon market. If Departments had the power to acquire and invalidate units of reductions, it could cause a level of uncertainty in the carbon markets and contribute to unwanted volatility in the price of carbon. Will the Minister be clear that by “dispose” he exclusively means sell?

Similarly, Government amendment No. 28 seems superficially innocuous. If it simply clarifies that when the Treasury buys units, it owns them, it seems wholly reasonable. However, that poses an interesting question about what the Treasury’s involvement in the carbon market will be. Is it the Government’s intention to trade in carbon units? Will amendment No. 28 give the Treasury the power and scope to intervene in the carbon markets in a similar fashion to the way it speculates on gold? As hon. Members know, the Treasury’s speculation on gold has cost the country billions and billions of pounds. Indeed, the decision to sell gold reserves has cost the Treasury more money than any single financial decision by any Chancellor on record.

If amendment No. 28 will open the door to similar speculation in the carbon markets, we will have to address it in more detail. Perhaps the amendment is not even required for that. Will the Minister clarify whether the Treasury has the power or the intention to trade—or speculate, as some of his old Labour colleagues might say—in the carbon market? If the amendment is for clarification only and the Minister can assure the Committee categorically that it is not even the thinnest end of a very thin wedge that could lead to speculating in the manner of the gold reserves, I apologise for being alarmist. I am sure hon. Members share my concern, given that the stakes are so high.

Phil Woolas (Labour, Oldham East and Saddleworth)

The biggest single retrograde decision by a Chancellor was the decision, as advised by the then right hon. Member for Witney, to join the European exchange rate mechanism at an unsustainable level against the express support of the vote of the national executive committee of the Labour party. The point about gold is that one has to look at what was done with the money in the meantime. It may well have been used to better purposes.

Anne McIntosh (Conservative, Vale of York)

What did you do with the money?

Phil Woolas (Labour, Oldham East and Saddleworth)

We invested in the economy of the United Kingdom to great effect.

Knockabout aside, the hon. Member for Cheltenham is scrutinising the Bill effectively. The Treasury, like any other Department, already has the power to buy and sell carbon units just like any other person. However, I am advised that the answer to his question is that the Treasury means the Lord Commissioners of the Treasury. They are not a corporate body. Amendment No. 28 will make it clear to a buyer of units that they can buy units from the Treasury even though it is not a corporate body. The hon. Gentleman is right that this is a technical provision.

The first question from the hon. Member for Bexhill and Battle was sensible, but I thought his second ridiculous. In answer to his first question, the term “dispose” is about selling, but in certain circumstances it could also mean cancelling—just to complicate matters. For example, if the country had reduced its emissions beyond what it was required to do, and had surplus carbon units, under clause 16, the Government could bank those units into the next period—remember the debate about banking or borrowing over periods—or sell them to another country. That is the basic principle. It could involve cancelling, but in practice it means selling.

Clause 80

Peter Atkinson (Conservative, Hexham)

With this it will be convenient to discuss Government new clause 6 and Government new clause 7.

Steve Webb (Liberal Democrat, Northavon)

Clause 80, on corporate reporting of greenhouse gas emissions, was inserted in another place by my noble Friend Baroness Northover, and I warmly support its retention in the Bill, and the rejection of Government new clauses 6 and 7, which are a pale shadow of her version. To give a flavour of the paleness of that shadow—I am not sure how colourfully I can convey the flavour of paleness—the Government’s proposal is to take out the reporting requirements in clause 80 and to insert two other clauses.

New clause 6 refers to publishing guidance to assist reporting, which must be done by October 2009—getting on for 18 months. The first draconian measure planned by the Government on such a vital issue, therefore, is the publication of guidance late next year to assist reporting. It will not necessarily require anyone to do any reporting, but those who do, or would like to, will get some guidance some time late next year.

New clause 7 promises a review of whether the reporting would contribute much, and must be completed no later than 2011. That means that we will get some advice in one year, and a review concluding in three years. One might sense a lack of urgency over the whole issue. The challenge, therefore, is to explain why it matters to the Committee. It has emerged during the debate, and in the contributions from Members on both sides, that we all share a common concern about climate change. The question is what role the corporate sector has, and how far the reporting requirements address those concerns. Our contention is that retention of clause 80, and even stiffening it up, would contribute far more than the Government’s very weak alternative.

John Gummer (Conservative, Suffolk Coastal)

Is the hon. Gentleman aware that very large numbers of companies were extremely distressed by the Government’s about-turn on the question of reporting? The best companies in the country felt that they had been deeply let down by the then Chancellor of the Exchequer. To them, this is another example of the Government’s unwillingness to recognise that most companies want a common system whereby they are commonly comparable, and do not want the system to be led by the least good companies, whose previous mouthpiece was Lord Digby Jones, who has become a Minister. No doubt that is the reason for this sad situation.

Steve Webb (Liberal Democrat, Northavon)

I am grateful to the right hon. Gentleman. I concur that there are companies behaving well, and that others must be dragged, kicking and screaming, to the climate change agenda. It is entirely unacceptable that companies that accept their social responsibilities in this area can be undercut or face unfair competition from those that do not.

One of the aims that we intend through the retention of the clause is consistency and transparency. There is no great desire to impose swingeing burdens on business for the sake of it. If we can ensure that the reporting that takes place is to the greatest extent reporting that companies might be doing anyway, particularly in a world of carbon trading and carbon budgets, measures that enable that to be done consistently and systematically are entirely welcome.

All members of the Committee will have received the letter from the Aldersgate Group, a coalition of businesses, lobby organisations, academics and hon. Members, who are coming together to argue for the retention and strengthening of the reporting requirements. It is worth thinking about why those might be desirable. The first thing to observe is that at present, the extent of reporting in annual reports or equivalent, according to Christian Aid, is quite limited. Although many companies do some reporting, it found only 16 FTSE-100 companies reporting emissions in their annual report or a parallel report, and the coverage of the emissions that were reported was often limited.

Quoting from Christian Aid—I think hon. Members will have seen these figures—only 58 per cent. of the most direct and easily identifiable emissions are reported. Some emissions are omitted, and the indirect emissions caused by the company’s activities further down the chain are also omitted. It is important that there should be comprehensive reporting of the direct emissions from a company, and a view should taken on the indirect impact of the company’s activities and how far and in what way that should be measured. The idea of waiting more than a year for guidance and then three years for a review as to whether anything should happen is staggering in its lack of ambition.

Some companies already have similar obligations. For example, companies that fall within the carbon reduction commitment already have to monitor such matters closely, so for many companies the costs are marginal. Perhaps the data are being collected anyway and would have to be presented in a different or standardised way, but it is not an additional burden for many companies. No one expects the smallest businesses to be part of the scheme. Many of the largest businesses are already covered by such a scheme, but we want greater consistency.

It is worth stressing that we are moving into a new kind of world. In the discussion of earlier clauses, the Minister spoke about the setting of carbon budgets alongside the fiscal Budget. In a world where we are buying, banking and borrowing emissions, trading permits to pollute or selling excess permits where we have saved, such things will be almost literally part of the cash flow of major companies. Companies that have a significant impact on the environment through their activities will need to know what their emissions are, whether those are rising or falling and whether they can save more. As the scope of the emissions trading scheme increases, those issues will become the bread and butter of corporate life in Britain.

With an eye to the London stock exchange and a desire for Britain to be a leading part of carbon accounting and reporting, as the right hon. Member for Suffolk, Coastal has said on other occasions, there is an opportunity for Britain to be a world leader and to establish expertise and advice on such matters, rather than the Government dragging their heels, kicking and screaming, to a destination that we all know we shall reach. That seems to be a key point. None of us believes that a Committee such as this in the next Parliament or so would imagine a world where businesses, and certainly big businesses, were not reporting such information systematically and on a comparable basis.

The attitudes of business are obviously important. Again, hon. Members will have seen that CBI members have been surveyed on the subject and some are enthusiastic, but the majority are willing to give it a try, with further work. Most businesses are not hostile to reporting. It is an area where, dare I say it, the climate is changing. In other words, people are starting to recognise that that will have to happen sooner or later.

There is inevitably an issue of cost on a matter such as this, but there are also benefits. I should be interested if the Minister gave us some idea as to what assessment the Department has made of the potential benefits in terms of carbon reduction from comprehensive, transparent and consistent reporting. Companies write to all hon. Members boasting of their credentials as socially responsible businesses, whether they sponsor computers in schools or whatever, and telling us what good guys they are. They increasingly do that in respect of carbon reduction, which is welcome, but we have no idea what the relative performance of those different companies is, because all we get are their figures on their definitions, with their coverage over time periods of their choosing. Therefore, there is limited scope for the competitive pressure to drive such things down, whereas if all the major companies had to report those figures consistently, the scope for pressure from shareholders, employees and consumers would be far greater. We all want to see a change of culture whereby this is as important a bottom line to many of the stakeholders in the business as the profit and loss account is to its shareholders.

There are costs involved. The Government have mentioned quite a high figure. We do not want something that is too onerous—it is pointless to be gratuitously onerous—but we want something that will build on the data that have already been collected by businesses and enables the public to know what is happening.

There is widespread support outside the House for the retention of guidance on reporting and, indeed, probably for beefing it up. I suspect that there is precious little support for removing what limited provision there is in the Bill—which the Government did not even include in the first place—and replacing it with lily-livered alternatives that are not worth the paper they are written on.

I urge the Committee to consider retaining clause 80 and rejecting the Government new clauses.

Gregory Barker (Conservative, Bexhill and Battle)

I associate myself with the sensible remarks made by the hon. Member for Northavon. We Conservatives are disappointed that the Government appear intent on weakening the Bill. Their lordships did an excellent job in enhancing the Bill in the other place and I am sorry that the Government are, again, trying to move back from the efforts that were made there.

I have made it clear to the Committee previously that one of the many reasons why we strongly support the Bill is because it gives long-term certainty and clarity to business, which is sorely lacking and badly needed. Clause 80 is an important part of the Bill because it gives exactly that sought-after clarity. I am aware that there are already a number of voluntary reporting standards for greenhouse gas emissions, such as the carbon disclosure project, but despite the admirable efforts of groups such as the CDP, reporting of clear, comparable information about UK business carbon emissions remains low. The latest carbon disclosure survey, from October 2007, found that only 46 per cent. of the FTSE 350 companies provided quantitative emissions data and, to quote the carbon disclosure project report:

“Investors still lack much of the necessary information to make informed decisions with respect to carbon emissions and embedded costs, given the limited quantitative disclosures by many of the companies listed in the FTSE 350.”

For that reason, Conservative peers supported the inclusion of clause 80 in the Bill, and for the same reason I should like the clause to stay where it is. My party has long been aware of the necessity for greater clarity on carbon reporting, but with two caveats. First, one standard methodology should be agreed to, rather than allowing a situation to develop where a patchwork of different accounting methodologies are being used by different companies, resulting in little more than mutual confusion. Secondly, we do not want small enterprises given additional reporting requirements that would add even more red tape and costs to their businesses.

I draw Committee members’ attention to early-day motion 81, tabled by my hon. Friend the Member for East Surrey (Mr. Ainsworth), which stated:

“This House...congratulates businesses that have begun to measure to reduce the carbon emissions resulting from their operations, supply chains, products and services; further notes the difficulties in defining the parameters for such measurement and in agreeing methodologies; believes that such measurements would enable both informed comparison and customer choice; emphasises the need for national and international consensus on such measurement and methodologies; and calls upon the Royal Society to take forward the process for establishing a mechanism for achieving such a consensus”

on such measurement and methodologies.

John Gummer (Conservative, Suffolk Coastal)

Is it not true that, as the cost of carbon becomes an increasingly real cost, companies are going to have to measure their carbon footprint much more effectively? Is it not much more expensive not to do so according to a standard mechanism? They will find, at some stage or other, that the broad-gauge people will have to come into line with the narrow-gauge people. The cost is considerable. Is it not much more sensible to do it now, to the value of everyone, not to give them extra expense, but to reduce it?

Gregory Barker (Conservative, Bexhill and Battle)

That would be eminently sensible. That would enhance economic value, because we would be creating a common market in carbon disclosure, a currency in carbon that would aid understanding, increasing the value and the economies of scale, rather than that haphazard approach. If we are going to have economic growth in those low-carbon industries, it is clear that we must have agreed common parameters. Existing clause 80, if implemented, would achieve that task with the speed and urgency required. Business could then get on with the real job of making important investment and strategic decisions based on clear, uniform information. The first responsibility of a modern Government is to provide a stable framework within which business can operate. I do not think that anyone, certainly on the Committee, would contest that carbon and the price of carbon are here to stay and will be an increasingly important part of our national and international economy.

Importantly, clause 80 does not apply to smaller businesses, only to any company that is required to produce a business review under the Companies Act 2006. That means that any company that qualifies for any two of the following conditions would be exempt: companies with turnover of less than £5.6 million, a balance sheet of not more than £2.8 million or fewer than 50 employees. That existing clause is enabling only, and is suitably flexible, permitting the Secretary of State to distinguish between different categories of company, such as by sector or size, and by emissions type. It is important to know that clause 80 is supported by a wide range of businesses under an umbrella organisation called the Aldersgate Group, as has been said—companies as diverse as British Telecom, United Utilities and the Co-op. City funds, such as Morley, London Bridge Capital and Quadris, are also supportive. The Government’s alternative, as proposed in new clauses 6 and 7, might not act as an industry driver to the same extent as clause 80 would.

Why does the proposed voluntary statutory guidance not include the requirement on businesses to publish their emissions data in their annual report and accounts? How does the Minister expect regulations to result in greater transparency in carbon reporting when the requirement to report no longer appears in legislation? Does the Minister feel that a review date deadline of 1 December 2011 for assessing the contribution of carbon reporting to meet the Government’s climate change objectives is a date—over three years away—that reflects the urgency with which we need to get to grips with the issue and to get British business emissions under control? In the final analysis, what UK plc needs is a common protocol that is consistent with international reporting standards, that will act as a significant driver for change—real, dynamic industrial change in the corporate sector—and will further enhance the City of London’s ambitions to become a world leader in carbon accounting, reporting, trading and so on. Finally, any solution must create a level playing field, which would allow consumers and investors to make meaningful comparisons between competitors.

At the end of the day, this all smacks of textbook economics on the part of the Labour Government, who seek to do right by business and the private sector but who fundamentally do not understand the dynamics of the private sector and of the wealth creators. It is backward-looking, and failing to understand that progressive, modern, entrepreneurial businesses in Britain today would welcome such forward-looking legislation. The clause is not anti-business; it is creating the necessary conditions for new businesses to grow and flourish in the low-carbon economy and for creating the dynamic change that we must see if we are going to continue to grow. The change is a backward-looking, regressive move. I greatly regret the Minister’s opposition.

Anne Snelgrove (Labour, South Swindon)

I have been listening with interest to what the hon. Gentleman has been saying. However, I wonder whether he agrees with the hon. Member for Rutland and Melton (Alan Duncan), the shadow Cabinet spokesman on business, enterprise and regulatory reform, who described corporate reporting of greenhouse gas emissions as “heavy-handed bureaucracy” in The Independent on Sunday on 6 April. Does he agree with that description?

Gregory Barker (Conservative, Bexhill and Battle)

Without seeing the full quotation, I do not think that I could pass comment on a very narrow excerpt. However, I think the hon. Lady will find that there is always concern about any new regulation. Of course we are the party of business and enterprise, and we would rightly exclude from these regulations small business. If the Government were to impose such requirements on small and medium-sized enterprises and small entrepreneurs, they would be unduly excessive at this stage of the development of the low-carbon economy.

However, let us be absolutely clear: we are committed to an ambitious fast-forwarding of the low-carbon economy and that will not happen with a timid, unambitious, step-by-step, incremental approach to business regulation. The fact that the proposed date is 2011, when this Government will have long been swept from power, is simply another sign that this Government talk the talk but are not prepared to walk the walk.

Nick Hurd (Conservative, Ruislip - Northwood)

I refer the Committee to my declaration in the Register of Members’ Interests. I will speak very briefly, because I would like to keep my powder dry for new clause 8, but I support the principle of mandatory disclosure of greenhouse emissions for companies of a certain size, which is how clause 80 is framed.

We recommended that mandatory disclosure in the quality of life policy commission, because we see it as a piece of constructive regulation that will perform a key task in meeting the key challenge of helping us to put a value on carbon. Putting a value on carbon is not necessarily the same as putting a price on carbon. It is a process of elevating the importance of this new currency, this new business risk, which is carbon, to the level of the boardrooms of major British companies, because it is a major business risk that they will have to manage.

In seeking to do that, we are not promoting a piece of excessive bureaucracy that goes against the grain of the market; we are seeking to accelerate an existing market trend. As my hon. Friend the Member for Bexhill and Battle stated, one only has to look at the trend of take-up for the carbon disclosure project and the initiatives run by Trucost to see that there is a trend of growing participation.

Again, when one talks to businesses and asks, “How big a burden is it on business to do this?” the answer is, “This is not insuperable bureaucracy at all”. Having said that, as my right hon. Friend the Member for Suffolk, Coastal pointed out there is an urgent need to develop a common standard, because that would be easier for the businesses involved and it would also make it much easier for increasingly interested private investors—owners of capital—to make comparisons between the companies that they invest in.

So, very briefly, I see clause 80 as a very welcome addition to a Bill that is designed to be a framework Bill, sending the most powerful signals to the market, and it is a nudge at exactly the right time, if one wants, as we do, the British economy to be in the vanguard of the transition to the low-carbon economy. If one wants that to happen, one wants British companies to be among the most energy-efficient and the most carbon-productive in the world, and we must get on with it, because this is a very real risk that people will have to manage.

It is extremely disappointing in this context, when there is a need for the Government to send strong signals to the market, that we see a Government in retreat from what is, as has been pointed out by the hon. Member for Northavon, really quite a timid proposal. I would actually go further. I would encourage the Minister to look further up the chain of capital, which is extremely apathetic now, and look at the way that pension funds and insurance companies, which own 50 per cent. of the FTSE 350, are engaged with the issue of climate change. The answer is that they are insufficiently engaged with it.

I urge the Government to look at the statutory requirement on pension fund trustees and their fiduciary duty, because companies such as Freshfields are beginning to point out that pension funds’ fiduciary duty must take into account climate change. However, we hear nothing from the Government in this respect and pension fund trustees are not engaged with this issue. Equally, insurance companies have no obligation on them at all in relation to climate change. If we saw activity upstream in the chain of capital, it would drive down through the choices made by fund managers, and we would start to see a process of engagement between capital and business. We have the most powerful capital markets in the world, and they are not being deployed in the interests of the agenda. We talk a lot about how we want the City of London to be the centre of carbon finance, yet when push comes to shove, and when we see a test whereby the Government are asked to take a relatively small initiative that goes with the grain of the market, they retreat rather than advance. The disclosure is insufficient. We need to do more. That would be extremely welcome, and we shall listen carefully to the Minister’s argument.

John Gummer (Conservative, Suffolk Coastal)

This is the part of the Bill where the Government’s actions seem extraordinary. I find them difficult to follow, and I shall explain why. All the indications are that progressive business is happy with the change in the Bill made in the House of Lords. If the Government, perfectly reasonably, lay a business review requirement under the Companies Act 2006, it looks peculiar, given the Bill, if that business review requirement does not contain the element of carbon reporting that is suggested. In any case, not to do so looks very odd against the rest of the Government’s policy.

There needs to be a significant reason for such action. So far that has not been divulged to us, although perhaps the Minister can produce it. He knows that, if he produces a good reason, people are prepared to support it or, at least, not to oppose it, but it will have to be a very good reason. It will have to explain matters to the co-operative movement, which has after all supported the Labour party for many years and clearly sees the measure as a proper way forward. It is also crucial for business. I hope the Committee will not mind my relating a story about why getting the carbon figures right makes a huge difference.

It is clear that retailers will demand that the carbon cost of every product is shown on the product. That is one of the exciting steps that will be taken. It will be a big step forward. Members of the Committee know my interests in such matters. They are set out in the Register of Members’ Interests. One of the companies that tried to find out its carbon footprint was PepsiCo, with which I am not connected, butI am interested that it did that. It measured the carbon footprint of a packet of crisps and discovered that, for 30 g of crisps, 75 g of carbon were used.

That seemed a large amount, and because measurements had been taken, the company thought that it had better find out the reason for thatamount. It discovered that, because it had quite reasonably denominated a particular size of potato that fitted its machines for chopping, farmers used more water than they would have done otherwise to make sure that the potato was big enough. The potato, being a great user of water in any case, became, so to speak, a bag of water.

Once the potatoes were chopped up, a lot more oil had to be used to fry out the potato water. As a result of measurement, PepsiCo decided that that was a silly waste of money and that it would be better off to change the machines so that they took a smaller potato, and to insist on mass as the measurement of the potato that it wanted. It would use less frying oil, reduce the cost of manufacturing the crisps, and the company could genuinely say that it had used less carbon to produce them. The point of the story is simple. Measurement is a crucial part of what we need to achieve our ends under the Bill. Not to recognise that in the Bill is to repeat the abiding failure of the present Administration.

I do not want to return to the subject of smart metering, but the Government have been in power for 11 years and still have only two pathetic pilot schemes. They cannot manage to roll out smart metering, when the Liberal Democrats have enabled them to do so by statute. If the Government had acted when they had cross-party agreement, that would have made more difference to our energy use than any other single act.

The Government will understand why we are suspicious of their inability to take on board the fact that measurement is crucial for action. We must measure. If we do not measure, we do not act. It is a central part of any sensible policy. To measure, there must be a sensible comparator, and the Carbon Trust has been sensible about that when dealing with carbon footprint marks on packets of crisps. It does not want different marks that do not have the same meaning, so that one cannot be measured against the other. It knows that most people have no idea what 75 g of carbon means, but they know that 75 g is lower than 100 g and that 65 g is lower that 75 g. People know that there is some kind of magnitude and as long as the measurement is done on the same basis, there will be some mechanism for making a judgment.

That is true about the world as a whole. Big businesses are concerned that we are gradually developing a range of different mechanisms for measurement, such as those from the old days when we tried to measure different series of interests. That is why we had the annual percentage rate. It was the only way to ensure that we compared like with like. In the end, people had to bring together a whole series of different mechanisms, which was complicated. Light-heartedly, I used the example of the broad and narrow gauge. It would have been more sensible if people had decided at the beginning what gauge they wanted. If they had made the correct decision, we would have had broad gauge, which would have been more sensible and comfortable.

We must have certain standards. Governments are usually sensible about that, so why not in this case? It is because there are people in the business world who always want to say no. I hope the Minister will not take this personally, but I must say something in a very direct way. As I am a religious convert, I can say that converts are dangerous because they tend to get rather excited about whatever it is that they have been converted to. I try to be careful about that in matters of religion, but the trouble with the Labour party is that to some extent, it is a convert to capitalism. Its difficulty is that it does not distinguish bad capitalists from good capitalists, as it has never understood the system. It gets led astray by the worst voices in the whole set-up.

The least good businesses do not want any regulation and do not see why they cannot continue doing what they have always done. When they are brought forward, the Labour party believes them. Those of us who have always been capitalist—cradle capitalists, if I may make that comparison—know perfectly well that people cannot be allowed to get away with that. We should look at the best and ask how we can enable the best to do better and the least good to catch up, and how we can do that in a way that is not too heavy handed.

We should take those who are big enough to bear the burdens and set the standards, and give them higher standards and expect more of them. That is what we should do. Oddly, the Government accept that idea in the context of health and safety. They expect businesses of all kinds to report the number of accidents, and nobody says that adding up accidents is too difficult. It is the first thing that must be done before action can be taken. If we do not know how many accidents there have been, we cannot put them right. If we do not know what the carbon footprint is, we cannot do anything to reduce it.

Big companies have enough vision to know that they must take such measures anyway, that it is good for them and enables them to reduce costs, and that it is not an incubus but something that might be valuable. They would like to get some competitive advantage, so they want a standard through which to compare one with another so that the system is not misused. All that seems sensible, so why on earth do the Government not want to do it? There might be some remarkable explanation that we have not yet discovered, but which we shall hear. Let us assume that there is.

Why will the Government’s alternative take so long? What on earth are we proposing? The problem is supposed to be urgent. We are faced with real difficulties. It is the biggest threat facing mankind, and the biggest danger to the continuation of civilisation. The Committee agrees on all that, yet the Government say, “It will take us 18 months to produce the guidelines, which will be entirely voluntary, and then we will have a review in 2011.” My goodness! That is absolutely the wrong example to set to the nation. Even if there is a frightfully good reason that no one has heretofore heard for not reporting such basic facts, there is no possible reason for not doing something quickly. Even if the Government began to convince us of the first of those circumstances, they could not convince us of the second. A leisurely march along the promenade at Worthing—that is the attitude that the Minister suggested—

Phil Woolas (Labour, Oldham East and Saddleworth)

Why Worthing?

John Gummer (Conservative, Suffolk Coastal)

Because it is a more polite word than Bognor! A leisurely stroll on a Saturday afternoon is the sort of thing one might do when one has nothing much more in mind. Instead, we should be setting an example by getting on with the most serious job facing us.

The Government’s proposal has the worst possible connotations, sets the worst possible example and gives full rein to the worst possible suspicions. If I considered the proposal afresh, and was told that the Government do not want to insist that big businesses tell the public their carbon intensity in a form that is measurable and comparable, but say instead, “We will take 18 months to produce some guidelines, after which we will take another couple of years before we are prepared to review the situation”, I would suspect that the Government did not mean anything at all. I would suspect that the Government had not got it.

This is a serious matter for the Minister. I know that he has got it, but I suspect that bits of the Government have not. The ill-named DBERR seems to be at the heart of all this, and I suspect that a particular Minister there is even more at the heart of it, as he was at the heart of the disgraceful U-turn by the then Chancellor of the Exchequer, who now happens to be the Prime Minister, in seeking a bit of extra kudos.

The Government must be very careful. They promised us proper reporting, but that changed, not as a result of any ministerial decision, of proper investigation or of real concerns, but following an overnight decision by the then Chancellor in order to curry favour, pressed by the man who then became a Minister in the Department of so-called enterprise. That is why we feel so suspicious, not of the Minister who is present, but of the Government’s whole history on reporting and measurement. It is a sorry tale. I would very much like my fears and suspicions to be allayed, but I suspect that they will not be. I hope very much that those with broader minds, bigger hearts and a greater understanding of what this is all about will join us in insisting on retaining the clause and throwing out those two pusillanimous suggestions, neither of which is worth a row of beans.

Phil Woolas (Labour, Oldham East and Saddleworth)

We have had a tremendous debate on this issue. It has been fascinating to witness Committee members’ political and ideological acrobatics. We have heard some excellent soundbites and accusations. The proposals have been described as “haphazard” and “textbook economics”. I thought at one point that the hon. Member for Bexhill and Battle was going to accuse me of being old Labour. My solicitors have been e-mailed in case he repeats that outside the room.

This has been an interesting debate, but it is based on a false premise. The debate has been caricatured as a choice between mandatory or voluntary. We believe that the Government’s strategy that is being presented to the House will be effective. It is all very well to act in haste, but if we do so and it does not work, we will not achieve the objectives that have been set out by hon. Members.

First, let us look at the clauses that we are discussing.

Anne McIntosh (Conservative, Vale of York)

Will the Minister satisfy me that he is not refusing to stick to the reporting procedures under clauses 80 on the grounds of cost? Proof has been given that the costs will be minimal and that there will be direct benefits to business for the reasons given by my right hon. Friend the Member for Suffolk, Coastal. Will the Minister satisfy me that he is not refusing to acquiesce on reporting procedures on the grounds of cost?

Phil Woolas (Labour, Oldham East and Saddleworth)

Yes, and I hope to persuade the hon. Lady of much more than that. The strategy outlined by the Government in the Bill and elsewhere is an effective way to achieve reporting. The Government are making an important point and it is supported by the CBI. I do not raise this argument just to reassure the right hon. Member for Suffolk, Coastal. The CBI briefing states that

“The CBI supports carbon reporting by firms and has an initiative underway to assess the feasibility of a common standard of carbon reporting that all firms could use.”

The crucial point is that we should not prejudge how this measure should be implemented. Therefore, we do not support the amendment made in the Lords on corporate reporting. The Government’s argument is that it would be tokenistic to say that we support mandatory reporting before we have the common methodology that hon. Members have been arguing for. We must develop a common method of reporting before it can be made mandatory. To say that it should be mandatory and to caricature the Government by saying that BERR Ministers have been foot-dragging is unfair. We are laying out a strategy to achieve carbon reporting.

Martin Horwood (Liberal Democrat, Cheltenham)

I must declare my connection to Business in the Community through the all-party group on corporate responsibility.

It is quite extraordinary that the Government are talking about prejudging common criteria. There is a plethora of common criteria out there, such as ISO 14001, Business in the Community and the environment index. There are many indices and bases. As the right hon. Member for Suffolk, Coastal pointed out, a lot of work went into the operating and financial review, and it was ready to be implemented days before it was dropped on a whim by the Government. It is naive and disingenuous of the Government to suggest that there has not been sufficient time to prepare common criteria. That is clearly nonsense.

Phil Woolas (Labour, Oldham East and Saddleworth)

I will ignore the phrase “naive and disingenuous”. One cannot have a plethora of common methods. If an auditor told a company to choose the method of accounting that it wanted and there was no national regulation on which one to use, companies would collapse.

Martin Horwood (Liberal Democrat, Cheltenham)

That is precisely the process that business went through in the preparation of the operating and financial review. The whole thing was designed to provide a common framework that took the best from other reporting criteria and provided a common basis on which all business was agreed, but the Government ditched it.

Phil Woolas (Labour, Oldham East and Saddleworth)

The hon. Gentleman is urging me to do exactly what the Government are doing. That is why we have laid down the timetable. I shall repeat what the CBI said:

“How this might be implemented”—

the common standard of carbon reporting—

“should not be prejudged.”

That is the point. We have a number of methodologies and a debate in this country. Government new clause 6 is stronger in this regard than clause 80. If hon. Members who oppose clause 80 read new clause 6, they will see that it states:

“The Secretary of State must publish guidance”.

However, clause 80 gives no date by which that should take place. Clause 80 is silent on the date, and it would allow the Secretary of State to ignore any compulsion on reporting. The Government’s new clause states:

“The guidance must be published not later than 1st October 2009.”

I remind hon. Members that we are in the financial year 2008-09, so that is the earliest date.

Gregory Barker (Conservative, Bexhill and Battle)

The Minister is right that we need guidance, but he fails to grasp that people are looking to the Government for leadership. They are looking for that elusive quality of courage that the Government talk about but do not show. People want the Government to make a decision, but why should we have to wait until 2011? The Manhattan project was completed in less time than that. The Minister has made no case at all for why it should be spun out until 2011—it is pathetic.

Phil Woolas (Labour, Oldham East and Saddleworth)

In which case why is the hon. Gentleman supporting clause 80, which is silent on a date? The Government’s new clause provides that the guidance must be published no later than 1 October 2009—at the end of the current financial year—as I shall explain, using the powers that we already have in the Companies Act 2006. Many companies are already reporting, so it would be folly to put in place a mandatory system without being able to define what that system was. That would be dangerous for all concerned.

John Gummer (Conservative, Suffolk Coastal)

It would not be folly at all. All it would mean is that there would be a clear, mandatory framework. All the Minister needs to say to the Committee is that the Government will announce the guidance within six months—it cannot be any longer than that because they already have it in the work that was done for their foolishly disbursed original arrangement—and follow the rules. Why not? We would then have put in place the whole of the package. For some reason unknown to me, the Government are always saying that they must do this, that and the other bit before it is ready, yet they want the general framework. That is how the Government normally operate, which is why the House of Commons spends its time in such a way.

That is all the Minister needs to do, so will he please now say, “I will do it in six months; I guarantee that that is what we will do, and we will follow what the mandatory arrangement means, because it will then be mandatory”? Under the Minister’s proposals, there is no assurance that it will be mandatory, even if the Government meet the dates, have the discussions and go to review.

Phil Woolas (Labour, Oldham East and Saddleworth)

Will the right hon. Gentleman tell me which system I am to mandate?

John Gummer (Conservative, Suffolk Coastal)

The point is that it would be perfectly possible today to mandate the system that industry had agreed in the original proposals for reporting. As the Minister does not want to do that, I have suggested that, given that there is no date, it does not stop him giving the Committee a commitment that within six months he will have come to an agreement to mandate what he will then decide is the best system. That is what the Government should do. They should decide on that, in company with the CBI and other organisations, and if he were to promise to do that in six months, we would get ahead with a mandated system. That would fit perfectly well.

Phil Woolas (Labour, Oldham East and Saddleworth)

The new clause sets a deadline, which is after the current financial year. One has to be realistic about such things.

Gregory Barker (Conservative, Bexhill and Battle)

Why is the financial year in November?

Phil Woolas (Labour, Oldham East and Saddleworth)

We are talking about requiring companies to report. That means that we have to give them advance notice before the year in which they are required to report the methodology behind what they are reporting.

Mr. Gummerrose—

Phil Woolas (Labour, Oldham East and Saddleworth)

I give way to the right hon. Member for frustrated, south.

John Gummer (Conservative, Suffolk Coastal)

I feel frustrated because this is a ridiculous argument. The fact is that we do not need 18 months to give people a year’s notice. We want six months. They will still have to have a year’s notice; we know that. Let the Government show that they can do something in six months. Six months is a very long time in which to get this done. We can do it perfectly well. All the evidence is there. It is a question of getting three or four parties around a table and saying, “Which of these are you going to go for?” The Government have to go for it and make the announcement. The mandatory arrangements are here, and we proceed. We have taken a year off the Minister’s present timetable, as far as the first stage is concerned, and two years off the second stage. Have we not saved three years?

Phil Woolas (Labour, Oldham East and Saddleworth)

With respect, the right hon. Gentleman is repeating himself. It is a responsible course of action to give companies advance notice. The right hon. Gentleman’s argument would have strength if there was an agreed reporting system, but there is not. Many people argue that the system should be international as well as domestic. Different systems are proposed. That is why the CBI, in its considered opinion, supports the Government’s position, which sets out a timetable for moving forward. Let me put some of the more technical arguments, and then I will come back to the policy argument in an attempt to persuade the Committee that the Government are not dragging their feet. We are setting out a procedure to get to where we want to be.

Steve Webb (Liberal Democrat, Northavon)

The Minister has assured us of his intent. As ever, I do not doubt him. However new clauses 6 and 7 would not have been drafted if the Government had not lost in the Lords. Why were new clauses 6 and 7 not in the Bill in the first place if the Government are so committed to such things?

Phil Woolas (Labour, Oldham East and Saddleworth)

The hon. Gentleman is having his cake and eating it—or trying to. Let me quote what my noble Friend Lord Rooker said in response to the debate in the other place. He said:

“As I and others have already said, when the Bill goes to the other place”—

by that he meant here—

“the Government’s collective view and individual views will determine how the Bill finally ends up and the lines that are taken. There are no lines in the sand in that respect. Every amendment that this place”—

the other place—

“sends to the other place will be considered and either rejected or modified, as happens when the Government think again.”—[Official Report, House of Lords, 31 March 2008; Vol. 700, c. 774.]

That was what my noble Friend undertook to do. He took the spirit of what the other place was saying and said, “I will look at this. I will work out a pathway to get there.” Rather than criticising the Government, I was expecting that hon. Members would say, “Well done, we have a way forward on which we have consensus.”

John Gummer (Conservative, Suffolk Coastal)

Let me try not to be frustrated with the Minister, but very direct. The difference is this: under the clause, people have to do something. Under the Government’s new clauses, there is no reason why they should have to do something. Those are two different things. That is not carrying the spirit of one, but merely using the words and the form. It is a hollow shell. If the Minister guarantees that he will use some other powers in a sensible time scale, we are willing to listen to him. As long as he asks us to accept that it takes 18 months to come to a conclusion—when most industrial spokesmen believe that it can be done much more quickly—and then does not commit himself to impose the measure in the way in which the clause in the Bill insists, we really have to say to him that the proposal is a pale shadow that is unconnected with the spirit of what was happening in their lordships’ House.

Phil Woolas (Labour, Oldham East and Saddleworth)

I have accused the right hon. Gentleman of repeating himself, and I am repeating myself now. That argument would be fine if existing clause 80 told me what to do—which system of mandatory reporting—and by when. It does not say by when. There is no date.

I can do better than the right hon. and hon. Members are asking. Not only can I give a commitment, but I can point to a power that already exists. If we wanted to impose different requirements on companies, there are already comprehensive powers to vary reporting and accounting requirements in the Companies Act 2006. Section 416 gives the Secretary of State the power to make provision by regulation about matters to be disclosed in the directors’ reports. Section 468 includes a power for the Secretary of State to make provision by regulation about the reports that companies are required to prepare, and their form and content. There is already a requirement on companies to report the environmental impacts of their activities.

The debate is taking place in a vacuum. Opposition Members are trying to portray the Government as somehow backtracking and foot-dragging. Instead, we are setting out a strategy to achieve the reporting of greenhouse gas emissions. Let me make an additional point: the existence of climate change agreements, the European Union emissions trading scheme and the new carbon reduction commitment already require companies to do what is being asked of the Government. The idea that the Government are foot-dragging is not borne out by the facts or the proposals before the Committee.

Mr. Hurdrose—

Phil Woolas (Labour, Oldham East and Saddleworth)

I give way to the hon. Gentleman who, I know, feels strongly on the issue.

Nick Hurd (Conservative, Ruislip - Northwood)

The requirement to report the impact on the environment is not the same as the requirement to report greenhouse gas emissions directly. Will the Minister be clear? Do the Government support the mandatory disclosure of greenhouse gas emissions from companies that are required to produce a business review under the Companies Act 2006?

Phil Woolas (Labour, Oldham East and Saddleworth)

As the hon. Gentleman knows, the Government, like him, support the idea of cap and trade and of carbon trading. In order to pursue that policy, one has to have common standards of measurement, verification and reporting. It would be irresponsible for the Government to pursue a mandatory system of reporting until there was a clear understanding of what that system should be for those companies that would be taken in by the wider measures. That is why we have set out what we believe to be a sensible pathway forward. Hon. Members are expressing frustration, but they should remember that companies are already required to report on their activities under the environmental requirements of the Companies Act. Those requirements could include the point made by the hon. Gentleman. They cover other matters, as I have explained in the past 60 seconds.

Nick Hurd (Conservative, Ruislip - Northwood)

Entirely correctly, the Minister has laboured the point about the need for a consistent system. The debate is more about timing than purpose. However, he is still dodging the question. Do the Government believe that it should be mandatory for companies that are required to produce a business review to report specifically their greenhouse gas emissions, not their impact on the environment?

Phil Woolas (Labour, Oldham East and Saddleworth)

I am not dodging the question, but the question that would have to be answered would be, “On whom?” Would we be talking about all companies in the United Kingdom, including those many tens, if not hundreds, of thousands for which it might not be practical? That is why I think that this method is a good way forward.

New clause 6 commits the Secretary of State to produce guidance on reporting by 1 October 2009. That is the time scale in which we believe that we shall have a common understanding. It also fits in with the international timetable.

John Gummer (Conservative, Suffolk Coastal)

It is clear that the Government require the business review from only companies of a certain size. Is it not fair to come back to the Minister and ask a simple question? Do the Government believe that it is right to have mandatory reporting of greenhouse gas emissions from companies of the size for which a business review is required?

Phil Woolas (Labour, Oldham East and Saddleworth)

I understand why the right hon. Member for Suffolk, Coastal and the hon. Member for Ruislip-Northwood are pressing me on this point. I repeat that we already have a system in place for companies that fall within the cap-and-trade schemes to report. Let me remind the Committee that one half of UK emissions are covered by schemes. That is already the case, and the schemes include the major companies, some of which have been referred to today.

I will not fall into making what I believe to be a tokenistic gesture—given the suggestion that this is somehow an environmental virility test—by saying that I will require all companies under all circumstances to report when I do not know what the methodology of such reporting would be. Frankly, that would be irresponsible. The right hon. Member for Suffolk, Coastal seems to shake his head in frustration, but he has not answered my question. What system of reporting does he want me to mandate?

The rest of the debate is in Hansard.