HL Deb 30 April 2001 vol 625 cc435-8

2.49 p.m.

Lord Berkeley asked Her Majesty's Government:

Following the rejection by the United States Government of the Kyoto Agreement on climate change, 'whether they will propose to the World Trade Organisation that it should authorise sanctions against United States industries that benefit from not having to pay the climate change levy.

The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty)

My Lords, the Government have made clear our deep concern about President Bush's remarks on Kyoto. However, we do not believe that trade sanctions would be a helpful way of engaging the United States on climate change. We will continue to work towards our aim of ratification and entry into force of the Kyoto protocol by 2002. The climate change levy is a key part of the UK's climate change programme. It is intended to ensure that industry and other parts of the UK non-domestic sector play their part in helping the UK to meet its Kyoto commitments.

Lord Berkeley

My Lords, I am grateful to my noble friend for that very full Answer. However, does he agree that UK manufacturers, who are liable for the climate change levy, are competing unfairly with US companies, which make no such contribution? Does that not justify a levy such as, I believe, the US Government imposed on cashmere because it did not like the solution to the banana dispute with the European Union a couple of years ago? Is it not the case that, if such action is good for them, it is good for us?

Lord Whitty

My Lords, although one has a certain sympathy with what my noble friend says, we do not believe that that is a sensible way in which to conduct trade negotiations. The WTO process has an integrity of its own. The US tried to put pressure on the WTO arrangements when they were going in its favour. However, we believe that the environmental dimension of international trade arrangements needs to be addressed. Indeed, the EU is anxious that the next WTO round addresses that. However, discussions on that aspect should be kept separate from those on Kyoto.

Lord Waddington

My Lords, what European countries, EU and non-EU, have ratified Kyoto? Is it not correct that the 15 EU countries have not begun to get close to the 8 per cent cut in carbon dioxide emissions target, and are they not all agreed on one thing—that is, that Germany has no hope of ever meeting the Kyoto target and honouring its promise to do away with nuclear energy?

Lord Whitty

My Lords, the last part of what the noble Lord said is definitely not true. The Germans, along with the British, are most on course for meeting their Kyoto commitments under the European bubble. Other European Union members are not as on course. We are anxious that they take measures which the British and German Governments have taken to ensure that we meet those commitments. It is hoped that the EU as a whole will aim for ratification by our target date of 2002.

Baroness Williams of Crosby

My Lords, will the Minister confirm that the European Union is far ahead of the United States in respect of energy conservation and the attempt to use cars which use fewer fossil fuels in order to maintain a rate of mileage? Will he consider putting across to the United States good practice such as reducing the use of energy, which would enable the US not to open the Alaskan nature reserve for the purpose of acquiring oil?

Lord Whitty

My Lords, it is certainly true that the European Union, EU countries individually and European-based manufacturers have made substantial changes which limit the use of fuel, particularly in the area of transport. The commitment of European car manufacturers to improve fuel efficiency will save 4 million tonnes of carbon equivalent by the year 2010. Hopeful signs are being seen in the United States that manufacturers there are picking up the message. Indeed, politically within the United States—for example, in California—that message has also begun to be taken on board. Other voices have also been heard in relation to President Bush's remarks.

Lord Davies of Coity

My Lords, although I recognise the genuine level of criticism registered against the United States Government, does my noble friend agree that, if the British Government followed the terms of this Question, not only would it make a difficult situation that much worse, it would be counter-productive?

Lord Whitty

Yes, my Lords. As I indicated, the use of World Trade Organisation mechanisms for achieving changes in the American Government's stance on Kyoto does not seem sensible and would lead to infraction proceedings against us under WTO rules.

Lord Tanlaw

My Lords, can the noble Lord tell the House what the scientists have been saying? What level of global warming is due to the sun and what level is due to industrial activity? Until that is made clear, is it not the case that many industrial countries will wonder why they should cut back on their emissions if many of them are due to natural causes? I believe that such statistics would be most helpful in putting forward this argument.

Lord Whitty

My Lords, the basic science of climate change, which effectively identifies the degree of human activity contribution to the step change in the rate of warming, is now fairly well understood and shared by the vast majority of scientists across the world. The latest International Panel on Climate Change report represents over 3,000 scientists from countries of all persuasions, including the United States and others. Therefore, I do not believe that the science surrounding this issue is now disputed by the vast majority of scientists. However, it is necessary for governments and industrialists to adapt to the facts.

Lord Lamont of Lerwick

My Lords, given the precariousness of the United States economy and the risks to the world economy of a United States recession, does the Minister agree that the imposition of sanctions on United States industries would merely lessen world trade, which the WTO exists to promote?

Lord Whitty

My Lords, yes. I have not advocated sanctions against the United States. However, we have advocated that, in terms of its own responsibilities, the United States should recognise the advantages to itself and to the world of addressing the problems which are causing 25 per cent of the world's carbon emissions. Were the United States to address those problems, the long-term benefits, not only ecologically but also to its economy and people, would become more evident. We hope that within its administration the voices which already recognise that come to prevail and that we can get down to constructive talks at Bonn in July and beyond in order to bring the Americans back into the discussions on climate change.

The Lord Bishop of Hereford

My Lords, will the noble Lord tell us what he believes to be available to European countries by way of bringing pressure to bear on the United States? If sanctions are not the way, what can we do to persuade that country? Does he believe that there is any chance of a change of heart on the part of the United States?

Lord Whitty

My Lords, I believe that there is indeed a chance for a change of heart. Clearly the Europeans will have to be flexible in negotiations. The American position has been made clear, but there will have to be some adjustment to that position. Nevertheless, I believe that the universal view of the European nations, which has been conveyed to the American administration by various means, industrial and private, will bring about a desire on behalf of the Americans to engage constructively in future negotiations. As I said, we shall see the beginning of that in Bonn in July and it is hoped that we shall then be back on course. This is probably the most important issue to face world leaders and I believe that President Bush recognises that.

Lord Stoddart of Swindon

My Lords, does my noble friend agree that, although the majority of scientists may well be in agreement about global warming and CO2, a group of scientists, led by the distinguished Professor Fred Hoyle, believes that, far from needing less CO2 in the atmosphere, we need more if we are to avoid a second Ice Age?

Lord Whitty

My Lords, I read the report of that view in those terms in the newspapers a few weeks ago. I do not believe that that is quite the position of Professor Hoyle. The conclusions that he draws reflect very much a minority of scientific opinion not only in this country and in Europe but throughout the world.