16:00 Caroline Lucas (Brighton, Pavilion) (Green)

It is crucial to note, however, before going into the environmental detail, that the Treasury’s obsession with GDP growth is also undermining social and economic progress for the vast majority of UK citizens. GDP is an incredibly poor metric for measuring wellbeing or social cohesion. For example, people becoming unhealthy can actually have a positive effect overall on GDP, as revenue from associated healthcare boosts growth. Similarly, the extraction of oil and gas pushes GDP up, while pushing us closer to the precipice of climate breakdown.

I congratulate the hon. Lady on introducing the debate, and on her hard work in this House on the environment and climate change. Although I certainly like to check on GDP and other financial aims, does she agree that the measure of success cannot be GDP alone? It must equally be based on the happiness and health of our constituents.

Just yesterday, a new report from the European Environmental Bureau exploded the myth of absolute decoupling. The study looked at a range of factors—materials, energy, water, greenhouse gases and so on—and found that there is no empirical evidence for an absolute, permanent, global, substantial or sufficiently rapid decoupling of economic growth from environmental pressures, either now or in the future. In other words, it is time to move from efficiency to sufficiency. As the report concludes,

Turning to the climate emergency, the primacy of GDP growth as the overarching priority for the economy is the elephant in the room. To quote Greta Thunberg,

“People always tell me and the other millions of school strikers that we should be proud of ourselves for what we have accomplished. But the only thing that we need to look at is the emission curve. And I’m sorry, but it’s still rising. That curve is the only thing we should look at…We should no longer measure our wealth and success in the graph that shows economic growth, but in the curve that shows the emissions of greenhouse gases.”

“My message to all the climate change protestors today is clear: let London return to business as usual.”

On climate, as on biodiversity, I believe strongly that we must look at the science. The Intergovernmental Panel on Climate Change’s October report, entitled “Global Warming of 1.5 ºC”, says that we need

The Treasury is doing a very good impression of ignoring the urgency of taking action. The Government boast about emission cuts and about legislating for a net zero emission goal to be reached in three decades’ time. However, the Committee on Climate Change said in its new report, which was published this morning, that the next 18 months are make or break, especially as the UK

This is all to say that the pursuit of economic growth is devouring our efforts to decarbonise. I will quote the work of Jason Hickel, a leading environmental economist at Goldsmiths. He has explained the situation by examining the IPCC’s trajectories on reaching net zero by mid-century. The IPCC is telling us that we have until 2050 to get to net zero, but the global economy is set to nearly triple in size during the same period, which means three times more production and consumption. It is hard enough to decarbonise the current economy in such a short time span. The idea that we will be able to do it three times over is, frankly, for the birds. However heroic our assumptions about the potential for decoupling, there is no evidence that it can be completed quickly enough in the timeframe that we have.

There is some hope, because the IPCC report contains one lifeline scenario that does not rely on speculative and harmful negative emissions technologies to keep global heating under 1.5°. That scenario is our emergency exit from climate breakdown. So what does it look like? Fundamentally, it is about scaling down material consumption by 20% globally, with rich countries such as the UK leading the way. As yesterday’s European Environmental Bureau report concluded,

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16:22 Robert Jenrick (Conservative)

As the hon. Lady eloquently set out, it is now more important than ever that the Government and institutions such as the Treasury, which is at the heart of this debate, confront head on the question of how we continue to grow the economy while protecting our environment and tackling climate change with all the vigour and urgency that she and others would like. I believe that the two can and will be done together, and can be mutually beneficial.

The UK is a world leader in this area, but I appreciate that many people—me included—would like us to go further. Between 1990 and 2016, the UK reduced its greenhouse gas emissions by 42% while growing the economy by more than two thirds, demonstrating that environmental action need not come at the cost of economic prosperity.

The Government are determined to continue to build concern for the environment into our economic model. In a moment, I will explain some of the workstreams that we have already undertaken and where we could go further. We want to ensure that environmental policies are well considered and that the Treasury as an organisation is leading them, as I believe it is. The hon. Lady argued that it is time fundamentally to change economic models if we want to address the climate emergency. She questioned in particular whether GDP is a sensible measure of our economic wellbeing, so I will begin by addressing that.

In the time left, I will briefly mention a number of other steps that the Government have taken. The Treasury’s Green Book, our guidance on the appraisal and evaluation of infrastructure and other investments, is essential to a number of decisions that are made by the Government. In 2018, we refreshed the Green Book to include additional environmental values, such as greenhouse gases, air quality and noise pollution. We also included a social cost-benefit analysis, which I hope is making a significant difference. It will be very important in the upcoming spending review. That work is well perceived internationally. My right hon. Friend the Chancellor of the Exchequer has now convened international Finance Ministers, and the area that the UK will likely lead on internationally is that of economic modelling and how we can do that better on a global scale.

The Minister spoke about the Green Book, which is still—despite the changes—essentially a neoclassical economic model based on equilibrium economics. Most scientists and economists on the fringes of economic thinking would tell us that we are moving into a disequilibrium position in our economic model. The two are completely incompatible and the Green Book is not fit for purpose as we enter a climate crisis in which many of its assumptions are no longer credible.

I do not agree with the hon. Gentleman, but the theme behind his remarks is one of the reasons why we have amended the Green Book. We have created this concept of social value, so we now take into account negative externalities to the environment and to people’s lifestyles as a result of greenhouse gas emissions, for example. I am happy to have a further conversation with him on that after the debate, as there is very little time left.

Following the report by the Committee on Climate Change, the Chancellor and I met Lord Deben and accepted his recommendation over the summer that the Treasury should do a major and urgent piece of work on how we can fund in a fair way the changes that we need to make as a society as a result of the Committee’s recommendations. That work is under way. I am very happy to meet the hon. Lady to give her more detail on some of those initiatives, which are extremely important. We want to take them forward with gusto in the months ahead.

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