Chancellor Rishi Sunak has announced a raft of measures in his Summer Statement, labelled by many as a ‘mini-budget’, in a bid to help the UK economy recover from the impact of the coronavirus pandemic, with “concern for our environment at its heart”.
It includes measures to encourage firms to retain furloughed staff, as well as plans to protect jobs, help younger workers and encourage spending with actions such as a VAT cut for leisure activities, an increase in the threshold for stamp duty and a restaurant voucher scheme.
Mr Sunak also confirmed a £3bn investment package to create green jobs, improve energy efficiency and decarbonise parts of the economy, featuring:
- £2bn Green Homes Grant under which homeowners and landlords in England will be able to apply for vouchers (from September) to pay for green improvements such as loft, wall and floor insulation. The government will fund two thirds of the cost of green improvements up to £5,000 per household and the full cost up to £10,000 for low income households.
- £1bn fund to improve the energy efficiency of public sector buildings, such as hospitals, schools and council buildings,
- £50m fund to pilot an effective approach to decarbonising social housing.
It is estimated these measures could make a total of 650,000 homes more energy-efficient, saving families £300 a year, cutting carbon emissions by half a megaton a year and helping to support around 140,000 green jobs.
Industry Reaction
Generally industry reaction has been positive, highlighting the announcement as a “good first step” but with further investment and a “clear and consistent long term strategic policy framework” required to achieve the Net Zero goals.
Lord Deben, Chairman of the Committee on Climate Change said:
“Making homes energy efficient and climate resilient is one of the UK’s biggest opportunities. The Chancellor is to be congratulated for making it the focus of his support for green jobs in what is a very encouraging immediate response to COVID-19. We must now understand quickly how the government intends to deploy the substantial funds announced today. It marks a turning point in the government’s support for energy efficiency. It is complemented by welcome announcements to decarbonise the public estate and create new jobs in the natural environment.
“The challenge before government is now to build on this stimulus and ensure that these green jobs endure beyond 2021. We look forward to seeing the Chancellor’s infrastructure strategy and spending plans in the autumn.”
Dr Nina Skorupska CBE FEI, Chief Executive of the REA, commented:
“The announcement confirmed a lot of what we already knew, £3bn funding for energy efficiency improvements and a drive on green job creation. Although we support the sentiment and maintain that this is a good first step, in reality, these funds are a mere drop in the ocean of what is needed to truly stimulate the economy and set the Government on track for Net Zero by 2050.
“The foundations for a successful Green Recovery are there; recognition of the need to upskill and train a new generation of green employees, an area we have often advocated for, and an understanding that energy efficiency and homes need to be prioritised on the road to Net Zero. However, the ambition in terms of funding is severely lacking and in some areas clarity over the details, such as whether the Green Homes Grant includes domestic installation of solar, energy storage and biomass boilers as well as insulation.
“In light of this, we urge the Chancellor to use the time between now and the Autumn Budget as an opportunity to work with the industry to create a comprehensive and far reaching plan that will ensure a successful and inclusive Green Recovery.”
The Head of Politics at Greenpeace, Rebecca Newsom, said
“The chancellor made many of the right noises about sparking a green recovery. But instead of digging in to deliver on this promise, he seems to have downed spades with the job only partly done. The government has missed the opportunity to kickstart the green recovery we need.”
Chris Venables, Head of Politics at Green Alliance, said in response:
“This could mark a really positive first step on the green recovery – but only if this ambition is continued throughout the rest of the year, and particularly in the Autumn budget. The Chancellor’s commitment to putting the environment at the heart of the recovery is obviously excellent – now we need funding and detail to turn this into reality.
“We urgently need to see a clear funding strategy for supporting public transport in its time of crisis, a long term strategy to ensure all buildings are warm and cheap to run, reversing the catastrophic declines in nature, and investing the technology of the future. The jury is still very much out on how green the UK government’s recovery will be – and we’ll be watching over the coming weeks and months.”
Claire Mack, Chief Executive at Scottish Renewables, said:
“We welcome the measures announced by the Chancellor to improve the energy performance of our buildings which will support the adoption of low-carbon heating technology.
“This investment follows the principles that are integral to a green economic recovery and is a welcome step towards reviving our economy which also helps to accelerate our progress towards net-zero. Ending the UK’s contribution to climate change by 2050 is a major challenge and the decarbonisation of heat will be key to achieving this.
“We look forward to further announcements from the UK Government to build on the initiatives announced today, and to understand how they will work with the Scottish Government to support a green economic recovery.”
Response from the Ground Source Heat Pump Association included:
“It’s hugely significant that the Chancellor has acknowledged the important role that the “green economy” can play as part of the country’s post-COVID recovery. The Heat Pump industry will work with Government to deliver a high value investment plan that will reduce carbon and GHG emissions and create new skilled jobs across the country. Our sector’s new training programmes, worked up with industry-wide collaboration, can ensure the highest quality deployment, provide up-skilling for fossil fuel engineers and technicians and apprenticeship opportunities, so delivering a lasting legacy of near zero emissions heating and cooling in our homes and workplaces.
We ask Government to provide the sector with a clear and consistent long term strategic policy framework that will enable our members, the wider supply chain and, crucially, commercial customers and homeowners, to invest with confidence. This is a golden opportunity to contribute to the two biggest challenges of our time, economic recovery and Climate Change, and is one that we cannot afford to waste.
Friends of the Earth’s head of policy, Mike Childs, said of the speech:
“This might be a green start, but it’s not yet a green recovery. While there are positive aspects regarding energy efficiency the job is not done, it’s a stepping stone on the way to greater levels of investment if it’s to be successful.
“The Chancellor said his investment will insulate 650,000 homes and create 140,000 jobs. Over the next decade, 15 million homes need insulation to eradicate fuel poverty and cut greenhouse gas emissions. The Autumn budget must spell out a multiyear funding programme on energy efficiency and a plan to switch homes from gas heating to heat pumps, as well as the obvious need for more investment in public transport, walking, cycling and nature restoration.
“With the government saying it will spend £27 billion on roads and so far only announced £3 billion extra on climate change today this is not yet the green recovery that’s clearly needed.”
Richard Black, Director of the Energy and Climate Intelligence Unit (ECIU) said:
“In addition to the £3 billion announced to help people make their homes warmer, the announcement opens up another potential avenue through which the UK could start making its energy use less wasteful, by providing employers incentives for job creation and retention.
Having made repeated statements about the need for a ‘green’ recovery, there are many aspects that this week’s announcements haven’t covered, such as renewable energy and electric vehicles. The presumption must be that the Chancellor sees these as offering less immediate opportunity for job creation than warm homes and will address them thoroughly in his Autumn Budget.”
