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Capital Gains Tax (Rates)

I must say that I felt that the previous speech was derived directly from a Conservative central office handout, which was unfortunately handed out before any proper examination of the Budget and its impact on those who benefit from it and those who do not. It is beyond doubt that the Budget is unfair, and harms those least able to defend and help themselves as well as future prospects for the recovery and development of the British economy. I want to consider that in the context of the energy and climate change theme of our debate. The Secretary of State, in introducing the theme, purported to defend the role of the Budget in the Department's proper ambitions for a green energy economy and a green recovery in the overall economy, with prospects for green jobs and a change-round so that we produce the goods and services that we need at a fraction of the carbon output. I have great respect for the Secretary of State's commitment to the environment, climate change and energy matters, so I am sad to say that I was reminded of the well known 18th century ballad, "The Vicar of Bray", in which the vicar of Bray intoned against popery when it was out of fashion and greatly in its favour when it was again in fashion. I hope that the right hon. Gentleman's—and, indeed, the Liberal Democrats'—principles on climate change and a low-energy economy are not affected by the expediencies that the Budget outlines. We must take action to change the way in which our economy works in the next few years. We must keep in place the goals to ensure that we reduce carbon outputs in our economy so that we reach our target by 2050 of no less than an 80% reduction in carbon output in our country and a 50% reduction throughout the world. I hope that the Government do not resile from that target, even though they have taken away targets for waiting lists in hospitals and for house building. If they do not resile from that target, there will still be a number of imperatives—a number of which the Secretary of State outlined—in terms of the investment needed in our economy over the next few years to turn around how much of it works, and in terms of energy supply and a range of other activities. That is why I thought, among other things, that the recent Forgemasters decision, although not enormous relative to some of those other areas, was nevertheless totemic. It was a decision for apparently short-term and expedient reasons to take away a loan—not a grant—from a company that would have invested in the future of our economy and, in particular, our low-carbon economy. I hope that the decision is not a precursor to other things for our low-carbon economy, because the coalition document sets out a number of ambitions that will work only if the investment, underpinning and Government support for such changes are put in place. They include ambitions on carbon capture and storage, a green investment bank, a floor price for carbon and a new green deal for home energy efficiency, all of which are essential pillars of that new, green, low-carbon economy. However, the prospect of a 25% cut in the Department of Energy and Climate Change's budget over the next few years suggests, at the very least, that a number of those ambitions will not be supported and funded in the way that will be necessary. I am concerned that the ambition for a green investment bank might turn out to be no more than a re-badging exercise, unless the Government are prepared to underpin the bank in a way that will secure those investments, which will go into new methods of production and new services that would not otherwise receive support from the traditional banking sector. If the Government have turned their face against loans that produce results far beyond the ambition of this loan, that would suggest that the green investment bank might just be the re-badging exercise that I have described. I would also be concerned if the green investment bank simply sought to replace money that is already in the system—for example, the £400 million for research and development in low-carbon technologies or the £120 million for the promotion and development of offshore wind—with other means, albeit perhaps with inferior outcomes. As for a floor price for carbon, it is one thing to have an ambition for the future. Setting aside for a moment the fact that we operate in the context of a European Union with a single market and that if our country unilaterally set a floor price for carbon, others might free-ride on it, any floor will have to have intervention to support it if it is breached. Do the Government intend to provide the assistance to ensure that a floor price can be sustained or do they think—as the Budget suggests—that these things can simply be left to the market? The green deal has been put in place, through the carbon emissions reduction target and the community energy savings programme, while the Great British Refurb is coming up—we hope—in order to ensure that houses across the country have the energy efficiency that they will require to play their part in the new low-carbon economy. Considerable investment will be needed to underwrite efficient home insulation for social housing and homes that are without cavity wall insulation. That will require several million pounds of Government support. All that was in place prior to the general election. Is it the Government's intention to continue that underwriting or will that be left to the market as well? A number of important aspects of the development of a low-carbon economy will require that intervention, support and underpinning. I am concerned that, instead of continuing to provide that underpinning, the intention might be to place increasing obligations on energy companies to undertake it instead. There are already obligations on energy companies concerning smart meter introduction, feed-in tariffs and the carbon emissions reduction target and, indeed, carbon capture and storage. As well as hearing about increased obligations on energy companies, we have heard that the introduction of smart meters will be rolled forward by a further three years, which will place a further obligation on energy companies to undertake the financing. Every obligation placed on an energy company increases the fuel price and puts more people in fuel poverty as a result. For every 1% increase in the fuel price, 40,000 people go into fuel poverty. Is the Budget going to be fair when it increases VAT not necessarily on domestic fuel but on fuel across the board elsewhere, which also indirectly but eventually pushes up fuel prices, leading to more people living in fuel poverty in the future? Will the mechanisms ensure that fairness in fuel access and fuel price becomes a real part of the country's future energy economy? The final important totem to watch carefully is whether the renewable heat incentive happens over the next year. Will the Government put in the underwriting to make that renewable heat incentive work? If they are not prepared to do that or to make a number of the other necessary underwritings to take us towards the green economy, they will have aspirations without means and the principles set out today will prove to be nothing more than hollow promises.