Recommendations & Conclusions
6 items
3
Recommendation
Forty-Sixth Report - Achieving Net Zero
Acknowledged
HM Treasury has not yet clarified how it will ensure net zero is given adequate weight in the assessment of government policies and projects. Achieving net zero will be an all-encompassing challenge requiring all parts of government to contribute to reducing emissions. Therefore, government must build net zero into the …
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HM Treasury has not yet clarified how it will ensure net zero is given adequate weight in the assessment of government policies and projects. Achieving net zero will be an all-encompassing challenge requiring all parts of government to contribute to reducing emissions. Therefore, government must build net zero into the structures and processes that govern departmental spending and prioritisation. For example, by assessing the carbon impact of new projects or programmes to consider their impact on achieving net zero. The Treasury’s Green Book guidance requires all policy, programme and project proposals to consider environment and climate impacts, including UK greenhouse gas emissions. The Treasury has recently reviewed this guidance and is now looking to place more emphasis on strategic objectives such as net zero in the assessment of proposals. But departments’ capability to assess climate impacts is varied, with the skills needed concentrated in the Department. The requirements as set out in the revised Green Book will have less impact than the Treasury intends, and ultimately programmes will not contribute to achieving net zero, if a lack of capability across departments means they are not put into practice. Recommendation: HM Treasury should, within two months, write to us outlining: • how it will ensure its guidance, such as the Green Book, will lead to departments adequately considering and reporting the impact of policy decisions on net zero; how all fiscal stimulus packages and infrastructure proposals will be stress tested against net zero and what measures will be incorporated into the Green Book to ensure projects are only approved if they align with 2050 net-zero target; and • how it will ensure the development of skills across Whitehall to assess the impact of decisions on net zero.
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Government response AI summary
The government agrees with the recommendation but describes existing Spending Review guidance, ongoing reviews of learning, and future publications, without specifically outlining the requested details on ensuring net zero consideration, stress-testing, and skills development across Whitehall.
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HM Treasury
9
Conclusion
Forty-Sixth Report - Achieving Net Zero
Acknowledged
We asked what the Department was doing to ensure that it would be able to track progress towards net zero when responsibility was shared across departments. The Department told us that the new coordination structures provided it with clarity on total emissions and the level of emissions for which each …
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We asked what the Department was doing to ensure that it would be able to track progress towards net zero when responsibility was shared across departments. The Department told us that the new coordination structures provided it with clarity on total emissions and the level of emissions for which each department has responsibility. It asserted that this meant each department could be held to account for its area of responsibility while the Department was overall accountable for total emissions. It also explained that departments would be set an overall emissions ‘envelope’, which all emissions related to their policy decisions must come in under and that this envelope would fall over time. The Department acknowledged that it needed to enhance its reporting on the different net zero delivery programmes across government and told us that it had tasked a net zero governance team to work on this issue.14 The Treasury told us that the Department was working with the Climate Change Committee (CCC) to develop measures that could be used to track progress. It explained, however, that it would take ‘some time’ to develop this and make sure that it was designed and implemented in the right way, but that it hoped to improve the data and information available to make policy and spending decisions this year.15
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Government response AI summary
The government agrees with the underlying sentiment of tracking progress, referring to existing annual 'Energy and Emissions Projections' and committing to set out more detailed metrics for tracking progress in a comprehensive Net Zero Strategy.
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HM Treasury
11
Conclusion
Forty-Sixth Report - Achieving Net Zero
Acknowledged
Net zero is an all-encompassing challenge that will affect every part of government. It will not be achieved if it is not sufficiently prioritised when departments make decisions that could impact on greenhouse gas emissions.18 We asked whether other departmental priorities, such as building enough homes, could supersede net zero …
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Net zero is an all-encompassing challenge that will affect every part of government. It will not be achieved if it is not sufficiently prioritised when departments make decisions that could impact on greenhouse gas emissions.18 We asked whether other departmental priorities, such as building enough homes, could supersede net zero and if the Department had the power to overrule these decisions in favour of net zero. We also asked how net zero was being prioritised in decisions like the granting of North Sea oil and gas licences, which could send the wrong message to the public about Government’s commitment to net zero. The Department explained that achieving net zero relied on its system of collective ownership, which should ensure everyone acted in support of the overall goal, rather than one department directing all others. The Department expected that where departments consistently fall behind, they would be held to account through the new coordination arrangements, which run from the Prime Minister and the Cabinet Committees, to the relevant secretary of state and the department itself, to ensure necessary action was taken to achieve net zero. The NAO found that spending reviews, led by HM Treasury, will be crucial to achieving net zero, as they allocate budgets to departments in the medium term (typically three to five years) and will provide an opportunity to encourage a coordinated approach. The Treasury and Department agreed that an important change in the most recent spending review was including officials from the Department to help scrutinise departments’ bids to ensure they aligned with the wider net zero strategy.19
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Government response AI summary
The government agrees with the underlying sentiment, explaining that Spending Review 2020 guidance required departments to include emissions of bids and that HM Treasury is reviewing learning from this exercise for future spending reviews.
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HM Treasury
13
Conclusion
Forty-Sixth Report - Achieving Net Zero
Acknowledged
We asked what impact measures such as the Green Book guidance had on major infrastructure projects like High Speed 2. The Department told us that departments were each responsible for ensuring that the projects within their areas remained below their overall emissions envelope and that it did not micromanage individual …
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We asked what impact measures such as the Green Book guidance had on major infrastructure projects like High Speed 2. The Department told us that departments were each responsible for ensuring that the projects within their areas remained below their overall emissions envelope and that it did not micromanage individual projects. It explained that in the case of the Department for Transport, the plans to achieve net zero would include a range of transport modes, from cycling, walking, cars, trains and planes, as well as core infrastructure projects such as HS2. It explained that this provided departments flexibility to balance their projects’ greenhouse gas emissions as if they went over on one project, the departments would need to find savings elsewhere.23
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Government response AI summary
The government agrees with the underlying sentiment, explaining that Spending Review 2020 guidance required departments to include emissions of bids and that HM Treasury is reviewing learning from this exercise for future spending reviews.
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HM Treasury
14
Conclusion
Forty-Sixth Report - Achieving Net Zero
Acknowledged
We asked the Treasury why, in its updated Green Book, it had not introduced a specific requirement for policies to explain how they aligned with net zero. The Treasury told us that the guidance already required Departments to consider greenhouse gas emissions as part of their appraisal process.24 The NAO …
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We asked the Treasury why, in its updated Green Book, it had not introduced a specific requirement for policies to explain how they aligned with net zero. The Treasury told us that the guidance already required Departments to consider greenhouse gas emissions as part of their appraisal process.24 The NAO found, however, that Departments’ adherence to guidance, including that in the Green Book, was often inconsistent. The Treasury accepted that taking greenhouse emissions into account was “not always happening on a consistent basis” and that it needed to do more to set the expectations of Departments.25 In the most recent spending review, the Treasury asked departments to provide a detailed assessment of the climate impact of their capital expenditure plans, but not all departments did so. It explained that the main issue was the capability of departments, as much of the capability for assessing the climate impact of policies sits within the Department. The Treasury recognised that there was more it could do to ensure departments have the tools and capabilities to assess the climate impact of policies.26 Impact on global emissions
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Government response AI summary
The government agrees with the underlying sentiment, explaining that Spending Review 2020 guidance required departments to include emissions of bids and that HM Treasury is reviewing learning from this exercise for future spending reviews.
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HM Treasury
23
Conclusion
Forty-Sixth Report - Achieving Net Zero
Acknowledged
The Department acknowledged that it needed to consider place-related aspects to achieving net zero and how local authorities could be involved in co-ordinating the changes needed in areas such as transport and energy.42 The Department told the National 36 Qq 52-53, 65-67 37 C&AG’s Report, para 2.19-2.21 38 Local Government …
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The Department acknowledged that it needed to consider place-related aspects to achieving net zero and how local authorities could be involved in co-ordinating the changes needed in areas such as transport and energy.42 The Department told the National 36 Qq 52-53, 65-67 37 C&AG’s Report, para 2.19-2.21 38 Local Government Association submission para 4 39 Q 39 40 Q 43; Local Government Association submission para 7 41 Local Government Association submission para 7; Local Government Association, Climate Change Survey, Research report, February 2020 pages 2, 35 42 Qq 40-41 16 Achieving Net Zero Audit Office that it intended to engage with local authorities about their role as part of the creation of the net zero strategy.43 During our evidence session, the Department further committed to actively engaging with local authorities on how sector strategies will be rolled out, as the strategies were published. The Department noted that it had provided toolkits to raise the capability and capacity within local authorities and has local energy hubs to enable engagement with them. These hubs aimed to help local authorities to develop plans to attract investment and fund the development and sharing of best practice between local authorities.44 43 C&AG’s Report, paras 11, 2.22 44 Qq 39, 44; C&AG’s Report, para 2.22 Achieving Net Zero 17
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Government response AI summary
The government agrees a clearer statement of national, regional, and local responsibilities is needed and will provide a more comprehensive statement on local authority engagement within the Net Zero Strategy, building on existing collaboration.
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HM Treasury