Examination of Witnesses (Questions 86
- 99)
TUESDAY 24 APRIL 2007
MR JONATHON
BREARLEY, MR
ROBIN MORTIMER
AND MR
TOM TAYLOR
Q86 Chairman: Good morning and welcome
to the Committee. I wonder if you could introduce yourselves,
because I know you are all relatively new to the job, and say
a bit about how you got there and where you are at.
Mr Brearley: First of all, I would
just like to say that I am very grateful to the Committee for
inviting me and my colleagues here today to talk about the work
of the Office of Climate Change. As you all know, I am Jonathon
Brearley, Director of the OCC; this is Tom Taylor who has been
leading on our analytical audit; and this is Robin Mortimer who
has led on the development of the draft Climate Change Bill. As
you know the OCC is a relatively new organisation and therefore
this is a great opportunity for us to set out where we are and
what we have been doing to date. Like all parts of the Civil Service
obviously we need to give private advice to ministers; but our
aim is to be as open as possible and to share our analysis essentially
as widely as possible. First of all, what the OCC is: the Office
of Climate Change is a cross-departmental unit which reports to
ministers and officials from six departments with the strongest
interest in climate change, and reports to Treasury and Number
10. Those departments are: Defra, DTI, DCLG, DfT, DFID and the
Foreign Office. As set out in my letter, we have three main functions.
The first essentially is supporting and improving management arrangements
for climate change policy and delivery across Government. Secondly,
running time-limited policy-focussed projects: these are usually
staffed by a mix of officials from different departments and over
time we would like to get people from outside Government actually
working on those projects as well and we do have one person doing
so now; and essentially these projects are run in a manner very
similar to other organisations, such as the Prime Minister's Strategy
Unit and aim to put up choices to ministers to consider collectively.
Thirdly, we do consolidate existing analysis and essentially identify
where we think more work might be needed and that work is on going.
In addition to all these functions we do have a smaller role which
is working across Government acting as advocates on climate change
and presenting to other departments about climate change issues
and how that might affect them. What I would like to do is just
run you through our work programme to date. First of all, we have
been setting up unified management arrangements for climate change
and energy within Government; we have been consolidating existing
analysis, which I mentioned. That has already reported on science
and there is a publication on the Defra website which sets out
essentially our summary of the science but otherwise is ongoing.
We have run policy focus projects on: the draft Climate Change
Bill; an ongoing project on household emissions—how we address
carbon emissions from households; decarbonising of heat supply—how
would you carbonise the supply of heat; the future of EU Emissions
Trading particularly Phase 3; and we have carried out a small
project on aviation offsetting which fed into the offsetting guidance
issued earlier this year. Overall our aim is to support Government
to deliver on what I think is a very challenging and, as you all
know, a very important issue. As I mentioned before, we very much
welcome ongoing dialogue as we do so.
Q87 Chairman: Thank you very much.
Could you just say how you worked with the Interdepartmental Analysts
Group, and how you think you may work in the future with the proposed
Committee on Climate Change which will be established?
Mr Brearley: I think the Interdepartmental
Analysts Group essentially is made up of analysts from across
Government who work on emissions. They are spread across a number
of different departments and indeed a number of different organisations,
like the Carbon Trust and Energy Savings Trust et cetera. Their
job essentially is to coordinate with each other and ensure that
emissions projections are consistent following a set of guidelines
issued by Defra. Our job essentially is to, first of all, consolidate
all of that analysis and to check where we are in terms of the
Government's progress; but, secondly, considering a coordination
role. Essentially the IAG is a group of analysts who come together
to discuss issues. There may be a case for the OCC to play a small
role in helping those analysts coordinate with each other, ensuring
that where analysis of one part of Government changes that is
reflected in similar analysis in another parts of Government.
Our relationship with the Committee on Climate Change I think
is still an ongoing question. Clearly the Committee on Climate
Change will need access to a huge amount of data, and a huge amount
of analysis. What we do not want to have necessarily is duplication
between what Government does, what the OCC does and what the Climate
Change Committee does. At the moment we are thinking essentially
about which models of Climate Change Committee might allow us
to do both.
Mr Mortimer: We are working very
closely with the IAG on that and the Committee. We are looking
at a number of alternatives. One really important issue is not
to duplicate existing Government analysis; and also to recognise
that quite a lot of the analysis which will be needed by the Committee
will have to be done by Government in any case; so the Department
for Transport is always going to want to have a transport model
which would be relevant to the Committee. We are looking at a
number of different models ranging from one where the Government
effectively acts as an intelligent customer for the Committee's
advice and another where more is outsourced to the Committee and
have not arrived at a conclusion on exactly the shape of this
model as yet.
Q88 Mr Chayter: From the point of
view of the world outside, businesses and local authorities, does
not the establishment of a new body actually confuse or fragment
the issue further? Can I ask, are you now responsible for all
Defra's work on climate change?
Mr Brearley: Absolutely not.
Q89 Mr Chayter: There are some responsibilities
still fragmented within the Department, quite apart from the division
of responsibilities between departments? The thrust of my question
is: do you see this as a major problem, the creation of a new
body; is it not going to confuse the world outside; and what are
you doing to try and provide a coordinative approach across Government
departments?
Mr Brearley: First of all, just
to be clear the OCC is not part of Defra but actually stands between
departments. We do not lead on policies.
Q90 Mr Chayter: You are not formally
part of Defra?
Mr Brearley: For pay and rations
we are.
Q91 Mr Chayter: You are located in
the same building.
Mr Brearley: We are located in
the same building but are governed by six departments and funded
by six departments. Our business is to support those departments
to work together. We do not run policy as, for example, Defra
does in parts of the Climate Change Policy, as does the DTI. I
think what the OCC offers is a much more coordinated approach
by Government. If you think about what we have done on the Government's
arrangements, we have created a single energy environment group
which is going to be supported by two cross-departmental groups
to allow that to happen. I think essentially the work of the OCC
should lead to a rationalisation and a simplification of what
is there, rather than a duplication.
Q92 Mr Hurd: Talking about the 2010
target, the 20% target, two questions arise from that. As I understand
it in 2005 emissions were approximately 6.4% down on 1990 levels,
which is just over a quarter of the way to the target. What do
you think are the key lessons that we should learn from the difficulties
this country has had in achieving that 2010 target? Secondly,
it seems to have taken Government a very long time to realise
they were off-track in terms of meeting that; in fact they were
making quite optimistic announcements about it back in July. What
lessons should we extract in terms of the efficiency of the Government
forecasting machine?
Mr Brearley: I think looking at
the NAO analysis they were very complimentary about a lot of the
analysis the Government carries out. I think we need to recognise
that our analysis is scrutinised by the United Nations and scrutinised
by an external panel of experts. Given that, projecting your emissions
has a number of uncertainties which are extremely difficult to
manage. For example, the prices of fuel et cetera all have quite
significant impacts on what we do. In terms of the 2010 target
I think Government recognises already it is going to be very,
very difficult to meet that target. I think we need to focus much
more on the long-term and how we get to 2020. Tom has been doing
some work on the analysis and perhaps could comment on that in
more detail.
Mr Taylor: I was surprised at
quite how complimentary the NAO report was on the analysis, not
because I had any preconceived ideas about the analysis here but
perhaps because of my background working on other areas, like
benefit fraud and benefit process where you do not typically encounter
such favourable NAO reports. I think it is quite clear that the
analysis has improved from the original programme work that was
done in 2000. The NAO acknowledged that is more consistent; it
is more comprehensive; and it is much more robust; and there are
clear signs that there is a more cautious approach to the estimates
that have been taken both in the projections and the policy appraisals.
Q93 Mr Hurd: What about key lessons
to be learned in terms of meeting these targets?
Mr Brearley: I think one thing
we do need to do is strengthen the accountability we have around
our targets, and that is exactly what I think the Climate Change
Bill aims to do, both in terms of embedding our longer terms targets
(and essentially that is the game we are in—it is delivering
against our longer-term targets) but also in setting a pathway
to get there. Essentially Climate Change Committee is something
I think will fully strengthen that.
Mr Mortimer: I think that is right.
Part of the answer is the Climate Change Bill, for two reasons:
one because I think it will create a new policy framework within
which trade-offs will have to be made. I think those will become
more explicit, with the Committee producing very explicit advice
on both what the trajectory should be but also on what the spread
of effort across different sectors of the economy should be, and
between domestic effort and overseas effort. I think all of that
will become much more transparent and I think that will change
the context in which Government makes policy towards meeting the
targets. The second point would be, as Jonathon said, the accountability
framework. You are right that, in a sense, we are four years away
from 2010 at which point it becomes more obvious that 2010 is
more challenging. I think by setting out a 15-year framework,
which the Climate Change Group proposes, there will be an annual
process of review looking 15 years ahead, and therefore the level
of scrutiny on how far the UK is on-track or off-track with its
budget will be that much greater. I think the Bill offers quite
a lot towards the question you are asking.
Q94 Mr Hurd: I think the Committee
would like some reassurance that a system of projection in the
2003 Energy White Paper which was telling us we were on track
to meet the 2010 target (when in fact at best we are likely to
achieve about half of it in terms of domestic reductions) has
been improved to such a significant extent we can rely on it in
the future?
Mr Brearley: Taking your first
point on domestic reductions, I think the way we define reductions
in our emissions in the future has to include what happens within
EU emissions trading in the future and perhaps in global trading
if we get there. Therefore, in terms of when we assess where we
are, I think we do need to take into account essentially what
is part of those systems. For example, EUETs covers 50% of our
economy. I think that over time we have to learn lessons about
how we manage our analysis better; and essentially how we can
begin to improve on the things we are doing by looking back on
our projections and essentially comparing those against what was
forecast in the first place. As Tom has said, the NAO has been
very complimentary about our work and we should not under-estimate
the difficulties in doing so.
Q95 Colin Challen: The Climate Change
Bill sets down a target of 26-32% cuts by 2020. To what extent
are you focusing on that new range of potential cuts? What policies
do you think will be required to meet them, and how will that
set of proposals be informed by our previous targets?
Mr Brearley: I think that the
Energy White Paper will come forward with a series of proposals
which will take us to that range you mentioned for 2020. It is
probably not for me to pre-empt that. Clearly there is an awful
lot for us to do to get there, but that is part of the Government's
process.
Q96 Dr Turner: You say you anticipate
that the Energy White Paper will save your office the necessity
to work out anything else. Are you confident in that, because
the Energy White Paper will basically address the question of
electricity generation; that is only one part of the CO2
imaging economy. Does it not need something to deal with the rest?
Mr Brearley: Yes, I think we do
need to deal with the rest of the economy and it is probably not
for me to pre-empt the Energy White Paper's projections either.
There is plenty for us to do to get to 2020, but also there is
a big question about how we get beyond 2020. If you think about
the investment cycles for most industries, including transport
and heat generation which I mentioned before, there are very long
investment cycles to get us to a place where we can begin to reduce
emissions. Therefore, there is lots of work.
Q97 Dr Turner: If someone else is
going to do all the work finding the policies that may or may
not achieve results, what are you going to do?
Mr Brearley: My point is that
there is an awful lot to do to get us to not only our 2020 but
our 2050 goals. The OCC will contribute to both of those. Part
of our work is feeding into the Energy White Paper.
Q98 Mr Chayter: What do you think
are the most urgent priorities that Government has to take on
board between now and 2020? Can we talk about the specifics? What
are the areas of emissions reductions that we have not yet done
enough about that you believe from your point of view have to
be priorities and are achievable between now and 2020?
Mr Brearley: I think as we all
know there is more to do in electricity generation and work is
ongoing. I think the OCC is beginning to look at the supply of
heat and supply of gas and what can be done to decarbonise those.
To be honest, it is too early for us to say how much is possible
by 2020 simply because that is a very early piece of work but
clearly there is potential there. The transport sector, which
is the other big part of the UK economy, I think is very difficult
and very challenging and it is going to take a long time to change
round. In terms of the OCC work I would argue there is potentially
more we can do with heat. As I say, electricity generation is
where a lot is happening and where we should be focussing a lot
of our effort.
Q99 Mr Chayter: Are you just writing
off the transport sector?
Mr Brearley: Absolutely not.
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