Government inaction on green economy is holding us back

Investment in our green economy would get Britain growing and cut the deficit, but government inaction is holding us back, writes shadow minister Luciana Berger.

Luciana Berger MP (Labour and Co-operative, Liverpool Wavertree) is the shadow climate change minister

Over the past few months, 0.2% second quarter growth, rising inflation and squeezed living standards have all underlined the need for urgent action to boost our economy. By focusing on building growth we can increase tax receipts, reduce welfare payments and cut the deficit less painfully than George Osborne’s austerity plans which go too far too fast.

If we are going to get our economy working again we need to get serious about building a low carbon future by growing our green economy. Currently the government simply isn’t doing enough to boost low carbon growth and we are all suffering as a result.

The last Labour government recognised that the threat of climate change could be used as a catalyst for building the UK’S low carbon economy. We introduced the Climate Change Act in 2008 to enshrine carbon reduction targets in law, moving Britain from a high carbon to a low carbon economy.

Our manifesto pledged to achieve 40 per cent low carbon electricity by 2020, which in turn would have created thousands of new jobs and apprenticeships. By contrast the self proclaimed ‘greenest government ever’ has talked a good game but delivered very little. This approach is letting down our economy, our people and our green businesses.

Firstly, this government has failed to produce a comprehensive strategy for low carbon growth.

In office, Labour published both the low carbon transition plan and the low carbon industrial strategy. This government is yet to develop a similar vision of any real substance. The Tory-led coalition’s ‘Plan for Growth’, released on the same day as the Budget, treated green growth as an afterthought. Just three pages of the 126-page long document included any reference to the low carbon economy.

And since last autumn the government has been promising a ‘Green Economy Roadmap’. The joint BIS, DECC and DEFRA initiative was meant to be published in April. It was finally published at the start of this month, in a rebranded document titled ‘Enabling the Transition to a Green Economy’. It’s easy to see why the ‘Roadmap’ part was dropped, as the final result is disappointingly lacking in substance, with little in the way of actual policy to turn the rhetoric into reality.

A coherent industrial strategy is vital to giving citizens, entrepreneurs and investors the confidence, certainty and support to establish and grow the economy. The UK desperately needs one. Without it, market uncertainty will grow and opportunities will be lost.

Secondly, too little is being done to support existing low carbon businesses and to encourage new start ups.

The demands of our highly competitive global economy mean we cannot afford to sit back. Other countries are powering ahead and we need to keep up. Offshore wind boosts the Danish exchequer by £2.7 million per year, while China and Germany recently signed trade deals on carbon capture technology and electric vehicles worth about $15 billion.

Market analysts estimate the renewables sector will grow by 20% per annum worldwide in the next five years, making it an attractive proposition for investors. Unfortunately over the past year Britain has been going in the wrong direction. In March a report by the Pew Environment Group showed the UK dropped out of the global top ten for low carbon investment. From being ranked fifth globally in 2009 we have now fallen to 13th.

The fall was blamed on:

“A sharp decline in offshore wind energy investments and uncertainty surrounding [government] policy.”

The PEW findings were corroborated by the Grantham Research Institute for Climate Change and the Environment, who found, in a report commissioned by the OECD last week, that UK government spending on low carbon technology is at the “minimum acceptable level” and below spending by Canada, France, Germany and Japan.

Alongside this the Tory-led government has cut funding for research into algae biofuels, which could be worth billions in the future.

The Green Investment Bank, when it finally begins to operate next year, should help boost investment, but with doubts still surrounding its independence and how it will operate, what kind of investments it will fund, and restrictions on its borrowing ability, we are a long way from knowing what impact it will have.

Thirdly, more needs to be done to encourage Britain’s home owners and businesses to de-carbonise.

Incentivising companies and households to reduce carbon emissions is a win-win, for them, the environment, and the economy. Not only does it reduce their energy costs, it also creates demand for energy efficiency measures and boosts supply chains. Household budgets are already struggling to cope with the increased cost of living, and record rises in energy prices this summer have left many wondering how they will make ends meet.

The government had the right idea by continuing with Labour’s concept of a pay as you save energy efficiency scheme. The idea is simple – the cost of installing energy efficiency measures is paid for from savings made on utility bills.

Unfortunately, the government’s finished proposals, called the ‘Green Deal’, are currently severely delayed in parliament, amid significant doubts about the scheme’s viability. As a result households up and down the country cannot expect help anytime soon.

Labour has been campaigning to improve the ‘Green Deal’. We proposed measures to cut costs for small businesses and co-operatives, plans for community action to tackle climate change and to create market certainty by linking the scheme to our carbon reduction and fuel poverty targets.

Government ministers rejected many of these during the Bill’s committee stage in the House of Commons, although we did succeed in getting a green apprenticeship scheme inserted into the Bill. With record numbers of young people unemployed, schemes like this are absolutely vital for them as a route into a skilled job.

It is estimated more than $100 billion will be spent on renewables and clean energy across the globe next year. We need an urgent plan to ensure some of that investment comes to Britain rather than elsewhere. We need ministers that champion and support low carbon businesses, rather than destroying market certainty, leaving them high and dry. And finally we need action to stimulate demand for energy efficiency measures, to drive down energy costs and create jobs.

It’s time for ministers to wake up, stop squandering golden opportunities and start delivering low carbon jobs and growth.

Like this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.

43 Responses to “Government inaction on green economy is holding us back”

  1. neilrfoster

    Government inaction on green economy is holding us back: http://t.co/pQ3u3je writes shadow climate change minister @LucianaBerger

  2. Bernard and Paul

    Shocking! "Tories Kill Kitten and Bugger Hippies". Metaphorically, of course, if you're a lawyer http://t.co/DB1Nqt3

  3. Louise Hazan

    Government inaction on green economy is holding us back: http://t.co/pQ3u3je writes shadow climate change minister @LucianaBerger

  4. Luciana Berger

    My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/soJaoqP

  5. Nathan Selby

    My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/soJaoqP

  6. David Nicholson

    RT @lucianaberger: My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/sgAALb7

  7. SESUK

    My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/soJaoqP

  8. Pamela Nash

    My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/soJaoqP

  9. Michael

    Government inaction on green economy is holding us back l Left Foot Forward – http://t.co/Ybv8lXw

  10. Walsall & Wolves GP

    Government inaction on green economy is holding us back l Left Foot Forward – http://t.co/Ybv8lXw

  11. Tim

    Government inaction on green economy is holding us back l Left Foot Forward – http://t.co/Ybv8lXw

  12. Political Planet

    Government inaction on green economy is holding us back: Investment in our green economy would get Britain growi… http://t.co/75PNZL6

  13. ReuseMatters

    My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/soJaoqP

  14. Helen Lowell

    Government inaction on green economy is holding us back: Over the past few months, 0.2% second quarter growth, r… http://t.co/R3v8U7M

  15. Dr. Ben Wright

    Incentivising companies and households to reduce carbon emissions is a win-win for them, the environment and economy: http://t.co/7eVcBm7

  16. robert the crip

    Yes building wind turbines using the same company that now builds trains Siemans, and then employing a Dutch Company to build the wind turbines has brought thousands of jobs for the Germans and the Dutch.

    This idea that Labour is a green party is pretty pathetic.

  17. Cllr. John Fulham

    My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/soJaoqP

  18. Bianca Jagger

    RT @leftfootfwd: Government inaction on #greeneconomy is holding us back http://t.co/sy0BvRG by @lucianaberger

  19. Martin Dando

    Government inaction on green economy is holding us back: http://t.co/pQ3u3je writes shadow climate change minister @LucianaBerger

  20. Googlyfish UK

    http://t.co/Pl0IFde Government inaction on green economy is holding us back http://t.co/kL01PIc

  21. Jake Dowse

    http://t.co/RwxOnhk @leftfootfwd @LucianaBerger MP on transition to a low carbon economy

  22. Tom Youngman

    This article by @lucianaberger obsessing over growth as ultimate goal demonstrates Labour still don't understand: http://t.co/3t2HiZl

  23. Juliedesforges

    My piece on @leftfootfwd today: Government inaction on green economy is holding us back: http://t.co/soJaoqP

  24. Leon Wolfson

    Most “green” jobs feed back their costs directly into fuel bills, hammering the poor.

    “The idea is simple – the cost of installing energy efficiency measures is paid for from savings made on utility bills.”

    Which the poor can’t afford to do, and hence they’re stuck with higher bills. Not to mention the extremely expensive energy meters (which need to be legislated against, they should be able charge no more than normal plans) or the people in shared accommodation, where the landlord isn’t interested in even basic energy savings because it doesn’t affect HIS bottom line…

    A golden opportunity to ignore the kicking the poor are currently getting, and to start a whole new kicking!

  25. Spenser Villwock

    Government inaction on green economy is holding us back – Left Foot Forward: Left Foot ForwardGovernment inactio… http://t.co/qODMb2l

  26. John Lever

    Government inaction on green economy is holding us back: http://t.co/pQ3u3je writes shadow climate change minister @LucianaBerger

  27. soc/res/invest

    Government inaction on green economy is holding us back | Left … http://t.co/pFLol88

  28. Knut Cayce

    RT @leftfootfwd: Government inaction on green economy is holding us back http://t.co/iFmjhJR

  29. Leroy Barr-Jenkins

    It says something when Labour appoint someone with no experience in this field, nor anything more than Public Affairs experience on her CV. How can the public possibly take this seriously when the Labour party hands this “greatest threat to our world” to someone who seems to be doing nothing more than copying and pasting from various articles to spin this in our (Labour’s)favour.

    If there is anything that has damaged the campaign for action on Global Warming it is that the public are feeling they are being duped by ‘a static here’, ‘graph there’ – misleading the public will just make them suspicious and undermine the goal, and that’s exactly what we see in the above article.

    It’s about time the Labour Party address this issue seriously. How about working more with scientists and less with lobbyists? Perhaps come up with more than just large scale solar/wind plants which are useless to anyone outside a 5 mile radius, which is common in the very countryside they are built.

  30. London IWW

    Government inaction on green economy is holding us back http://t.co/fHrC77N | #UKpolitics

  31. Wáaberg Vittersen

    > Offshore wind boosts the Danish exchequer by £2.7 million per year

    That is very misleading. In 2009, the Institute for Energy Research commissioned the Danish think-tank CEPOS (Centre for Political Studies) to report on electricity states. It found that Danes pay the highest residential electricity rates in the European Union (partly to subsidize wind power), and that the cost of saving a ton of carbon dioxide between 2001 and 2008 has averaged 647 DKK (€ 87, US$ 124). The report estimates that 90% of jobs were transferred from other technology industries to the wind industry, and that 10% of wind industry jobs were newly created jobs, and states that as a result, Danish GDP is 1.8 billion DKK (US$ 270 million) lower than it would have been without wind industry subsidies.

  32. Dave Citizen

    Good article Luciana – ‘Green’ agriculture and industries offer a wonderful opportunity for us to take back control of our society and build the foundations for sustainable prosperity. The Germans realise this but we seem to be stuck in a 1980s mindset of trying to respark consumption based economic growth.

    We need a bold plan to shift Britain’s economy onto a green, low waste, high quality, high skills footing. The interests of international finance will be against it but it is essential for our long term prosperity.

  33. plasmaborne4rel

    Green economy is a temporary measure in the CyberInterNetic Agenda of the rich&powerful.

    http://www.scoop.it/t/cyberinternetics/

  34. Leon Wolfson

    Dave – And when energy bills have tripled, and the poor can’t afford em? Well yes, that WILL cut demand.

  35. Will Major

    “more needs to be done to encourage Britain’s home owners and businesses to de-carbonise.”

    “Not only does it reduce their energy costs”

    Ok. Labour set an affordable homes target. Of the homes that were built, the majority were large high-rise flats and smaller apartment developments. They have very little roof space for solar/wind.

    Those wealthy enough afford semi-detached housing may have a larger surface area per person, and maybe even a garden.

    Yet another policy that would only help the wealthy.

  36. Dave Citizen

    @ 7 & 8 – given that demand for the old sources of fuel is only likely to go higher and higher, decisive action is urgently needed to replace or do away with the need for such fuels. If not, the poorest will, as you say, pay the highest price.

    Those of us on the left need to think big – greening our economy is part of this and is perhaps the only realistic way to take back control of the economy so it can benefit all instead of a few. Can you really see us building a more equal and prosperous society based on scrabbling to keep the flow of fossil fuels going? Designing and building the low energy, high quality homes and products of tomorrow is what we should be doing, not racing to the bottom in the old consumption / profit rat race economy of the 80s.

  37. Leon Wolfson

    @9 – Sure. Might go up as much as 20% in the next few years. This is not 300%, which is the *minimum* figure I’ve seen for pressing ahead with a “radical” green agenda.

    There isn’t a shortage of fossil fuels, not for a century or more, when you start looking at shale gas and tar sands. If they are not used, then it will be by political, and not economic will. And yes, it would be a disaster if they were used, but they is an alternative.

    “Greening” our economy is a code word for making the utilities unaffordable for the poor. Nuclear power is, and remains, the best option for keeping the lights on.

    The race to the bottom is the race to get the poor to turn off their utilities, as you are advocating.

  38. Kenneth Hawtree

    It’s a very confusing message we’re putting out here; and lacks information on how we’ll be paying for it.

    “Household budgets are already struggling to cope with the increased cost of living, and record rises in energy prices this summer have left many wondering how they will make ends meet.”

    Indeed, so short term price increases are precisely what they don’t need right now.

    “Alongside this the Tory-led government has cut funding for research into algae biofuels, which could be worth billions in the future.”

    Could? So could magic bean fuel. There are plenty of alternative fuels out there; among the most promising are those which break down waste into oil. That won’t cut carbon emissions but it will reduce the need to drill. Solar is not green if the only place you can implement it is large scale farms. It reduces heat and water delivered to the ground; meaning nothing can grow on those “farms”. It could never keep the lights on and keep us all fed. The only place you could really make use of this, is the desert – and look to Qatar who have built huge farms in useless land.

  39. Team EnerChange

    UK & US seem to have similar challenges. Government inaction on green economy is holding us back | Left Foot Forward http://t.co/EdzWcjv

  40. John Lightfoot

    Government inaction on green economy is holding us back | Left Foot Forward http://t.co/rA1bVS8

  41. Dr. Ben Wright

    Incentivising companies and households to reduce carbon emissions is a win-win for them, the environment and economy: http://t.co/mWXjkYDd.

  42. Is a ‘green populism’ possible, and can Labour help foster it? | Left Foot Forward

    […] Government inaction on green economy is holding us back – Luciana Berger MP, September 3rd […]

  43. Australia’s climate change legislation passes the final test in the Senate | Left Foot Forward

    […] Government inaction on green economy is holding us back – Luciana Berger MP, September 3rd […]

Leave a Reply