“Building Back Better”, analyzing the green credentials of the UK’s annual Budget
By Charles Johnsen, YES-UK Policy Team
With Boris Johnson, the self-described ‘Green Tory’, and Rishi Sunak’s repeated assertions to ‘building back better’, there was significant reason for climate campaigners to be hopeful about the contents of this year’s budget.
This article aims to provide a summary of key takeaways from the annual budget delivered by the Chancellor of the Exchequer, Rishi Sunak, on the 3rd March 2021.
The annual budget was under scrutiny not just from those looking to gain an insight into the government’s plan for stimulating a ‘post COVID-19 recovery’, but also for delivering on the government’s ‘green rhetoric’. With the UK hosting the COP 26 summit and pressing others on the international stage to adopt more climate targets, it was widely hoped that this budget would deliver some concrete and ambitious policy laying out the UK’s route to net-zero 2050. But is it the case?
First, let us assess the ‘green policies’ the government did include.
The £15 billion in green bonds are the world’s first green savings bonds and will raise funds to be invested in green projects. The hope is that these green savings bonds will drive investment in ‘cleantech’, reducing the UK’s dependence on GHG emitting fossil fuels (Woodcock, 2021).
Additionally, the budget announced the creation of a £1bn ‘Net Zero Innovation Portfolio’, designed to support and encourage innovations in renewable energy by providing substantial rewards for their progress. The scheme already has three programmes; £20m for an offshore wind competition, £70m for a long duration energy storage competition and £4m towards a biomass feedstock programme.
Finally, the budget announced a £12bn commitment to creating the new National Infrastructure Bank. Headquartered in Leeds, this investment is designed to lead the future investment and delivery of promised infrastructure projects.
However, whilst the budget shows the government’s commitment to stimulating an investment led recovery, the lack of detail and depth have left many feeling that it hasn’t gone far enough on delivering on pre-budget rhetoric.
Firstly, the problem with these initiatives, according to Ajay Gambhir, senior research fellow at the Grantham Institute, is the lack of detail linking these policies to the UK’s legally-binding net-zero emissions target. He comments: “this didn’t feel like a Budget that was fit-for-purpose in driving acceleration towards net-zero in any way” (Vetter, 2021). This lack of detail has left many climate activists in a similar boat; feeling misled by the government failure to explain how these policies are specifically going to contribute towards Carbon Budget targets.
Furthermore, the budget was conspicuous for what it did not include, namely the £1.5bn Green Homes Grant initiative which has quietly been ‘discontinued’, allegedly due to a lack of demand. However, with 26 million homes in need of an upgrade, there is clearly no shortage of need. The government’s failure to tackle the climate footprint of the UK’s housing sector is a gaping hole in this Budget. Estimates identify the construction and built environment as contributing around 40% of the UK’s carbon emissions (Hill, 2020). Additionally, the budget can also be criticized for its poor handling of the transport sector, as the ‘‘freeze on vehicle fuel duties” will only encourage more GHG emissions to hemorrhage from this industry.
Friends of the Earth, Head of Policy, Mike Childs, sums up the UK’s Budget as a ‘drop in the ocean’ of what is required to fight the climate emergency (Vetter, 2021). I, however, would rather liken it to a ‘false start’, one that the government dearly needs to address. Not lacking in its intent but in its detail, this budget felt rushed. If the UK government is going to successfully portray themselves as a global leaders in the fight against climate change as this year’s hosts of the COP26 summit, then it needs to be more explicit with its policy behind all its ‘green rhetoric’.
…Finally, who knew the back of the chancellors famously red briefcase was black!
References:
- Woodcock, A (2021) Budget to launch ‘green bond’ to encourage investment in green technology. The Independent,
- Hill, J (2020) ‘Eliminating building emissions is the ‘greatest challenge’. Architects Journal.
- Vetter, D. (2021) How Green is the New U.K Budget? Climate Experts Deliver Their Verdict. Forbes.
- Kelly, G (2021) The three biggest surprises from those bizarre Budget photos. The Telegraph.
Post Edited by Ginelle Greene-Dewasmes, YES-UK Policy Team & Reviewed by Manon Dangelser, YES-UK Country Representative.
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