The government has rejected recommendations from MPs for councils to lead the way in cutting carbon emissions.

In a report this summer, the Commons environmental audit committee said carbon dioxide reduction figures could run ahead of national targets where climate change indicators are included in local area agreements.

But responding this week, the government said national figures should inform local and regional target setting. "Different local circumstances mean that it would be inappropriate to require local and regional bodies to set targets more stringent than national ones," it said. But it accepted the need to review and monitor the effect of policies to tackle climate change at a sub-national level and argued that the new Department of Energy and Climate Change will strengthen the national policy framework in which sub-regional government operates.

It said: "Recently introduced measures, especially the new climate change indicators, will make a substantial difference. But we will consider further measures where we believe there is a need."

The government added that ministers are expected to make an announcement shortly on the sub-national review consultation and plans for an integrated regional strategy.