To view the video highlights of this event, please click here.

Andrew Raingold, Executive Director at the Aldersgate Group (AG), welcomed the audience to the latest in the AG's events series on greening the economy.

Previous AG events have heard from Caroline Spelman, the Defra Secretary talk about the need to grow in step with the environment, and EU Commissioner Janez Potočnik discuss the opportunities in a "resource revolution". Given the increasing prominence of a counter-narrative that green policies are a burden on business, which the AG fundamentally opposes, Mr Raingold said that it was vital “for the Opposition to provide a compelling and persuasive narrative on the benefits of a green economy and hold the Government robustly to account in their objective to be the greenest government ever.”

Rt Hon Caroline Flint MP, DECC Shadow Secretary of State, stated that “Britain is not short of the capital skills or technology needed to make this transition to a low carbon economy”, but that there has to be a strong political vision to drive growth.  

“The UK Government has a legal obligation to cut our carbon emissions by 80% by 2050 – and that requires a programme of action.” The Labour Party believes there is a need for “an active industrial strategy to seize the opportunities that green economic activity can create”. The five essential characteristics of this strategy include:

1) unlocking private investment by delivering on electricity market reform, with the Government showing decisive, and consistent action;
2) better public procurement;
3) a strategy to supply the skills needed for a low carbon economy;
4) rebalancing the economy, supporting growth in the regions and in the manufacturing sector; and
5) engaging the public and communities.

Ms Flint rejected the argument that “economic growth and environmental sustainability are inherently reconcilable”. One side of the argument claims environmental policies are “a lead weight around the neck of UK plc”, and the other that “economic growth threatens to deplete the world of resources”. Ms Flint emphasised that “we can provide for our systems and meet their aspirations without ruining our planet; it’s not a zero sum game”.

“The longer we delay action, the costlier mitigating and adapting to climate change will become, the economic opportunities will slip through our fingers”, while “the economic prizes will have been surrendered to more adventurous nations”.

Historically, “successful economies are those who adapt to new technologies quickest, build an industrial base for that era and plan the transition to avoid huge economic shocks... Investing in the green economy is not just a route out of the recession but a necessary and urgent adaptation to the economy and society that we will need for the decades ahead…As we rethink and review our policies this is an opportunity for Labour, and more importantly for our country, and it’s one I’m determined to seize.”

To read Caroline Flint’s speech in full, please click here.

Guy Battle, Partner for Sustainability and Climate Change at Deloitte asked “is the green economy good for the UK, or is it bad for the UK?”

Mr Battle was emphatic that, while there is a very important debate to be had about “what growth means”, the green economy represents an absolutely fantastic opportunity to provide “jobs, opportunities and exports.”

Speaking from a business perspective, Mr Battle emphasised the need for consistency in messaging from Government to ensure investment in the green economy. The industry has an appetite to invest and recognises that the low carbon economy is the only way to go, “not least because it’s part of their branding but also because they feel it’s the right thing to do”. Additionally, “there is an absolute requirement for coherence”; this “needs to be simple, easy to administer from the government perspective and also for business”.

One of the biggest struggles within Government is short term versus long term. “Treasury has very short term austerity issues to deal with”, ministers come in for one to two years and “most governments don’t think beyond their term”; this creates a lock-in and no significant long-term planning. Civil service have “got a fundamentally important role to maintain continuity in that process”.

Nick Mabey, Chief Executive, E3G stated that the environmental agenda has slipped back after the brief dawn of 2008, when financial ministries around the world were beginning to wake up to the need for action.

Mr Mabey warned that austerity is now the dominant force across Europe and this must be combated directly. He argued that there is a huge opportunity to progress electricity market reform – not just in terms of building new power stations, but particularly on the demand side. “We haven’t built a demand side of electricity markets and we’ve got a real opportunity to do something radical and bold to provide incentives to everybody (including households, community groups and new businesses) to deploy technologies for energy efficiency”. 

Another significant opportunity is the Green Investment Bank (GIB) and we “can’t wait until 2016 to make it work”. He said that the GIB is “not going to break the UK economy as it’s a small amount of debt but a very important amount of debt to take on the government balance sheet”. He also emphasised that there was no need for a National Infrastructure Bank, as some have suggested. “The GIB can do everything we need it to do. It exists, it has employees, it will grow, we can make it larger and we can even expand its scope in a new parliament.”

Mr Mabey discussed how the UK is stimulating innovation by moving to produce public goods like energy security and climate security by creating new markets. As “Government is a market maker”, what it says is more important now than it was in the past; “everything should be very carefully worded… What we’re doing is really changing the role of Government in the economy.”

Jack Frost, Director at Johnson Matthey stated that “while we are emitting less carbon in Britain these days, we are actually consuming some 20% more than we did a decade ago”.

Despite achievements such as the Climate Change Act, the UK’s “carbon footprint is increasing relentlessly and remorselessly”, because goods and services are “no longer produced in Britain but produced using coal fire power stations in China”. Buying less carbon, rather than shifting production to overseas, is essential in stimulating innovation.

Mr Frost also pointed to a lack of clarity in some government policies. Whereas Zero Carbon Homes demonstrated a high level of ambition and was an inspiring vision, the CRC Energy Efficiency Scheme, for example, lacks the same drive. Many large companies could cut their carbon emissions by 10% within a year and do not have to wait until 2020 to do it.

“We can’t wait until we’re feeling a bit richer to address these issues”. Both industry and Government are making investments that “will create the future into which we’re going to emerge from these economic difficulties”, but it will not necessarily be a fairer, more sustainable future. Strong leadership will be needed, for example by influencing investments for the transition to a green economy through “a consistent, progressive policy framework”.

This event was sponsored by Deloitte.