Green Economy

Lord Oates Excerpts

Thursday 12th March 2020 Lords Chamber

[Lord Oates (LD)]

My Lords, I am grateful to my noble friend Lady Parminter for initiating this important debate, and for her excellent and informative speech. This has been a fascinating debate from which I have learned a great deal, not least from my noble friend Lady Suttie in her powerful speech on the domestic and international impact of plastic waste, and also from the noble Baroness, Lady Jenkin, on the importance of conserving resources—something my mother certainly instilled in me from a very early age, although I confess that I bought a new suit for my wedding.

The noble Lord, Lord Marland, remembers the coalition Government fondly. I am sure that he was hugely committed to tackling climate change as a Minister in it, but my recollection, as the then Deputy Prime Minister’s chief of staff, is of a constant and debilitating battle with the staggering myopia of George Osborne as he tried to undermine almost every significant effort to tackle climate change, squandering the economic opportunities we could have seized and wasting time that we could not afford to waste.

Having said that, I welcome the Government’s commitment to a net-zero economy by 2050, but I hope that the Minister recognises that this ambition will be meaningless unless it is backed up by concrete plans to reshape our economy in a way that promotes resource efficiency and can deliver net-zero carbon usage. There is no point willing ambitious ends unless we are prepared to will equally ambitious means.

To do that, we must shift our thinking so that, instead of being overwhelmed by the challenges of reaching a net-zero economy, we are able to inspire people by its opportunities. The noble Lord, Lord Browne of Ladyton, made the important point that we have to be honest with people that the changes required will mean us having to change the way we live our lives. Part of our job is to make sure that that is a positive prospect rather than purely seen in negative terms. As the special report of the LSE Growth Commission, Delivering Strong and Sustainable Growth in the UK, notes:

“The pathway to net-zero must be perceived across the UK as a whole-economy opportunity to deliver material benefits to communities, as opposed to creating costs and inconveniences for households … Done right, in 2030 the UK could have higher living standards and improved health and wellbeing, with UK businesses innovating and adopting cutting-edge zero-carbon technologies and practices fit for the mid-21st century.”


That is the prize on offer, but we will seize it only if the Government have the courage to lead by example, not just in setting world-leading ambitions, welcome though they are, but much more critically in showing that they are willing to take the complex and urgent decisions needed to realise them. Britain has a particular obligation to show this leadership as host of the 26th UN Climate Change Conference taking place later this year. That is why, as the noble Baroness, Lady Jones, highlighted, yesterday’s Budget was deeply dispiriting. The noble Baroness also made the critical point about the importance of a just transition to a green economy—something noticeably absent from the Budget.

While there were some welcome measures, they were offset by a complete absence of action in critical areas such as home energy and other building efficiencies and highly counterproductive actions in areas such as the £27 billion road-building programme and the ongoing fuel duty freeze while public transport fares continue to soar. I hope in his summing up that the Minister will be able to explain why the Government missed the opportunity in the Budget to take action on energy efficiency. It is such a critical area, contributing a significant proportion of carbon emissions, and it must be tackled. As he knows, the Domestic Premises (Energy Performance) Bill, introduced by my noble friend Lord Foster of Bath with cross-party support, is a modest but important measure in this regard. I hope that he will tell us that he will press the Government to support it.

At the moment, the chasm between the measures required to meet the Government’s 2050 net-zero target and the measures set out in the Budget is jaw-dropping. It is as if someone told Rishi Sunak, “Don’t worry about the net-zero target. We don’t really mean it.” That is not just a disaster for the climate but a massive missed opportunity for our economy. It has the twin impact of introducing uncertainty while failing to inspire innovation or investment. We should be taking advantage of the 2050 target to support and galvanise business with a vision of Britain as a world-leading green economy able to boost our competitiveness internationally and deliver comparative advantage to our economy. We need to set out a comprehensive road map to that new economy so that businesses and entrepreneurs have sufficient confidence in the direction of travel to assume the leading role they will need to play in this transition.

So much needs to be done and we cannot afford to wait. We should be investing now in the modern energy and transport infrastructure that we will need to underpin this new green economy. We should be reshaping regulation of the financial system now so that it is incentivised to support cutting-edge green industries, is transparent over the climate risks of its investments and is required to hold appropriate capital reserves against loans to fossil fuel industries that may well become non-performing. My noble friend Lady Sheehan and the noble Lord, Lord Gadhia, also raised the important issue of the dangers to the financial system of stranded assets.

The Paris conference committed the world to limiting the rise in global average temperatures to well below 2 degrees centigrade above pre-industrial levels and to pursue efforts to limit the increases to 1.5 degrees centigrade, yet it is estimated by the research and campaigning organisation Positive Money that the financial system is currently financing warming of more than 4 degrees centigrade. Its executive director, Fran Boait, said that that

“represents an existential threat not only to finance and the economy, but to life on earth”,

so we have to take action today, not at some distant point in the future, to ensure that we have a regulatory system that can bring these financial institutions into line with our net-zero objective. I hope that the Minister will be able to indicate how the Government plan to start going about doing that. We must not allow a situation to occur where the taxpayer ends up having to bail out financial institutions once again for reckless investments that end up damaging the global environment and the integrity of the financial system.

A number of authoritative bodies, such as the climate change committee, have set out the sort of measures that will be required to transform our economy if we are to meet our 2050 objective, but very little of it is happening, and every effort to propose practical steps is rebuffed with the assurance that a new strategy or review will be published shortly. The Chancellor was at it yesterday, shunting off urgently needed decisions until the net-zero Treasury review that we were promised ahead of COP 26. We do not need more distant strategies or reviews. We need action plans. We need progress reports. We need accountability. What we chose to do or not to do now will determine what our children and grandchildren are able to do in the future.

The coronavirus has taught us the severe dangers of getting into a feedback loop where delay is all we are left with. We are, we hope, still in the containment stage of catastrophic climate change, but if we do not act soon, if we do not give global leadership now, if we do not move on from the talk and start rising to meet the challenges and to exploit the opportunities, we will miss the containment window and all we will have left are delay and mitigation. That would be a gross betrayal of the obligations to the generations who follow us. Despite the disappointments of the Budget, I have to have faith that the Government will shift their approach and match their actions to their ambitions. I have to have faith because we cannot wait five years. We do not have the time to waste on despair. If faith can move mountains, then surely it can move the noble Lord, Lord Callanan, the Prime Minister and his Cabinet colleagues. Perhaps it can even move Dominic Cummings, but perhaps that is asking too much.

I shall finish on a positive note. I welcome the fact that the 2050 target has established Britain as a global leader, at least in its ambitions. I believe that the Government can also make us a global leader in our actions, but if they are to do so, they will have to show that they have the moral courage to lead, the vision to inspire and, most importantly, the determination and commitment to deliver concrete action. Global Britain leading the world in tackling humanity’s gravest threat is a global Britain I would sign up to. I hope that the Government will rise to the challenge.