Subsidy Control Bill — House of Lords, 2022-01-19
Topic: Environment
Jennifer Jones (Green Party, Left): My Lords, I too would like some clarity on the Bill. For example, there are some key exemptions in it that cut out important issues, and some key omissions that mean that the new subsidy scheme misses a huge opportunity to support levelling up, net zero or innovation of any kind. I have five questions for the Minister. I am sure that he will not be able to deal with them this evening, but I would be happy to have them answered in a letter The Bill contains principles that energy and environment subsidies must adhere to. Some of these principles are very welcome—for example, subsidies must not relieve polluters from their liabilities and caps can be put on maximum CO2 emissions eligible for electricity generation subsidies. That is all good, but I do not understand—this is my first question—why these principles are carved out as applying only to energy and environment subsidies. Why are environmental principles not being applied to all subsidy schemes so that we can ensure that all public money is being used to move towards net zero and tackle the climate and ecological crises? Every subsidy should increase the level of environmental protection as compared to a baseline situation. At the very least, no subsidy should be granted that will reduce the level of environmental protection as compared to the baseline. Secondly, the confusion is further compounded by the absence of any definitions of what constitutes an energy or environment subsidy. It is not at all clear when these special principles do or do not apply. For example, is a scheme for discounted bicycles an environment subsidy, subject to those extra principles, or not? Does it depend whether the scheme is intended to get people to drive less, or drive the same amount but cycle just for fun? I can see quite a lot of future legal battles over this Bill when we try to apply it Thirdly, we know with certainty, because the Bill tells us in Clause 51, that nuclear energy is not included in the energy and environment subsidy scheme. I would really like to know the Government’s justification for this. Is it because they believe that nuclear energy will fall foul of the principles, such as fair and competitive processes or increasing the level of environmental protection? Nuclear energy subsidies are a huge amount of money—many billions of pounds—so it is very important to understand why they are being excluded from the provisions that apply to all other energy sources, especially renewables. Is it giving preferential treatment to nuclear? It rather looks like it. I will probably table an amendment on this in Committee Fourthly, another notable carve-out in the Bill which my noble friend Lady Bennett has raised is that none of the subsidy rules will apply to the Bank of England’s monetary policy transactions. I would like to understand why. Greens have long understood that monetary policy should be a major tool in tackling the environmental and climate emergencies, such as directing the Bank’s cheap credit towards environmentally sound lenders or at the very least cutting out the most environmentally damaging ones Fifthly, I would like to find out more about the community energy schemes, which I thought were happening a long time ago. They have environmental and social benefits, and there is a low risk of distortive effects on competition. Can the noble Lord tell me what is happening with them? I am likely to table amendments on all these issues I hate agreeing with the noble Lord, Lord Forsyth, but he is absolutely right; when the Government bring us a thin Bill such as this, we will put in a lot of amendments, just to try to understand what is going on. Of course, we then get the blame for slowing down the business. Can the Minister be very clear that we need enough time to debate this properly and not take it late at night, as is the Government’s usual practice when they want us to hurry up and stop talking This Bill is really lacking that overarching sense of using monetary and fiscal policy to transform our economy from a dirty, polluting one to a clean, green, high well-being society. The mechanisms in this Bill will not achieve that and lack ambition. I am looking forward to working with noble Lords—even the noble Lord, Lord Forsyth—in proposing major changes to this Bill so that we can get back on track to reach net zero.