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Regulatory reform needs to recognise economic benefits of ambitious climate and environmental regulations

16th June 2021

In response to the report produced by the Taskforce on Innovation, Growth and Regulatory Reform, Signe Norberg, Head of Public Affairs and Communications at the Aldersgate Group, said: “Regulation is a vital part of ensuring the competitiveness of UK industry, creating jobs, increasing innovation and driving investment in crucial technologies and goods. We welcome the Taskforce’s recommendation on reforming the UK regulatory framework for energy generation and distribution in line with the Government’s climate ambitions. However, while the report examines areas to modernise regulation and highlights important areas of innovation, such as transport, energy and finance, it fails to adequately incorporate Government’s environmental objectives and net zero ambitions, which will be essential to ensure that the UK builds back greener and creates a green industrial revolution.”
 
Signe Norberg added: “Businesses support ambitious, forward looking, well joined-up and properly enforced environmental regulations, policies and market mechanisms. [1] They are essential to creating a stable environment in which businesses can invest. Previous regulatory efforts have been insufficient in assessing wider social and environmental impacts [2], and to ensure we meet our objectives it is crucial that climate and environmental objectives are placed at the heart of the Government’s regulatory reform agenda.”

- ENDS -

[1] Buro Happold (2021) Fostering Prosperity: Driving innovation and creating market opportunities through environmental regulations, commissioned by the Aldersgate Group
[2] National Audit Office (2016) The Business Impact Target: cutting the cost of regulation

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Business coalition calling for the Planning Bill to deliver net zero and protect nature

14th June 2021

More than 100 prominent business leaders have written to the Prime Minister calling for the net zero transition, nature’s recovery, and climate resilience to be at the heart of the UK’s new planning system.

The letter, which has been co-ordinated by the Aldersgate Group and UK Green Building Council (UKGBC), welcomes the government’s commitments to addressing the housing crisis and reaching net zero by 2050. To ensure it meets its housing targets and environmental commitments, it is vital that the Planning Bill drives a strategic approach to the net zero transition, ensuring that development that is resilient to the impacts of climate change, and that nature can be supported and restored.

The signatories therefore call on the Prime Minister to ensure the new Planning Bill directly aligns with the obligations under the Climate Change Act and plans to reverse nature's decline in the Environment Bill. The letter highlights how planning can play a fundamental role in meeting the Government’s new homes target, achieving its environmental goals, and delivering the infrastructure that is needed for the transition to a decarbonised, climate-resilient economy.

The letter calls for:

  • The new Planning Bill to align directly with, and support, the UK’s net zero target and ambitions for nature set out in the Environment Bill.
  • Clarity on how land allocated for ‘growth’ will be compatible with achieving net zero, securing nature’s recovery and delivering development resilient to the impacts of climate change.
  • Genuinely enhanced levels of protection in planning for designations in the Envrionment Bill intended to support nature’s recovery.
  • Increased resourcing and skills support for local planning authorities, in order to support their abiltiy to set local targets, and deliver across multiple objectives in their local areas.  

The letter has been sent to the Prime Minister, alongside Secretaries of State Rt Hon Robert Jenrick MP, Rt Hon George Eustice MP and the Chancellor of the Duchy of Lancaster the Rt Hon Michael Gove MP.

Julie Hirigoyen, Chief Executive at UKGBC, said: “The upcoming Planning Bill has been earmarked as the biggest planning shake up since World War II and represents a critical opportunity to embed a strategic vision for a decarbonised and climate resilient economy, as well as reversing biodiversity decline. Planning is part of a wider system that is currently failing to deliver both the quality and quantity of homes needed to tackle the environmental and social challenges we face, and the upcoming reforms must form part of a coherent, long term commitment by the Government to environmental protection; one that gives developers clarity around low carbon, nature friendly investment.

“The number of businesses coming together to support this letter shows clear demand for climate change to be at the heart of our planning system, and I urge government to listen to industry and match the level of ambition set out in this letter.”

Signe Norberg, Head of Public Affairs and Communications at Aldersgate Group, said: “Reforms to the planning system present an opportunity for Government to not only tackle one of the most significant social challenges facing the country – the housing crisis – but also to ensure that our planning framework actively supports the UK’s climate and environmental ambitions. To reach net zero emissions by 2050 and reverse the decline of the natural environment, it will be essential that the planning system fully integrates these issues at the heart of the new legislation. By setting forward a strategic approach to planning in line with this, Government can unlock private sector investment, create jobs, generate vital low carbon skills, and build homes that are fit for the future.”


Ambitious environmental regulations are key to the UK’s economic recovery

2nd March 2021

Today, the Aldersgate Group releases a new report, Fostering Prosperity [1], which shows that ambitious and well-designed environmental regulations have a track record of delivering significant economic and environmental benefits. The report, written by global design engineering consultancy Buro Happold, highlights that the business community sees ambitious environmental regulation as a key driver to aid the UK’s economic recovery and achieve its net zero emissions target and other environmental ambitions. The Aldersgate Group calls on Government to recognise the value and importance of ambitious environmental regulations as part of its ongoing regulatory review [2].

The report is based on a review of specific environmental regulations in the construction, waste and automotive sectors and interviews with 20 business leaders and practitioners. It finds that the regulations studied in these sectors have delivered growing business investment in innovation, new products and services, job creation and skills.

For example, the London Plan, which establishes requirements for improving the sustainability of housing developments in London, has supported over £100 million worth of investment in heat networks, solar PV installation and carbon offsets in 2018 alone [4]. The Landfill Tax has been a net positive job creator for the waste sector and transitioning towards a more resource efficient economy could generate the creation of a further 500,000 jobs [5]. In the automotive sector, the transition to electric vehicles could generate around £3 billion of private investment and 30,000 new jobs by 2030 [6].  

Interviews carried out as part of the report show strong business support for ambitious, forward looking, well joined-up and properly enforced environmental regulations, policies and market mechanisms. These are seen as essential to drive business investment in low carbon goods and services, which will support the UK’s economic recovery and put the UK on track to meet its net zero emissions target and the ambitions set out in the Environment Bill and Resources and Waste Strategy.

Key recommendations include:

  • The UK government’s ongoing regulatory review must recognise the important economic benefits of well-designed and ambitious environmental regulations and the central role they will need to play to put the UK on track for its climate and environmental targets.  
  • To support business investment, good environmental regulation should be forward-looking, with clear and ambitious targets that tighten over time.
  • Environmental regulations and standards must not sit in a silo. To be economically and environmentally effective, environmental regulations should be carefully joined up across sectors and with the UK’s overall industrial strategy. They should promote high degrees of resource efficiency and be accompanied by investment in supporting infrastructure (such as charging infrastructure for electric vehicles), research and development, skills and market access.
  • Environmental and low carbon policy should shift away from a culture of compliance and towards one of high environmental performance, promoting investment, upskilling and the sharing of resources.
  • Environmental regulations are only effective in shifting corporate behaviour and driving business investment if they are robustly and fairly enforced. Going forward, the role of regulators and local authorities should be enhanced, not diluted, with funding put in place to allow them to robustly enforce standards despite pressure on public finances.

Nick Molho, Executive Director, Aldersgate Group, said: “We urge the Government’s Taskforce on Regulatory Reform to look at environmental regulations not as red tape, but instead as drivers of innovation, job creation and skills. If the UK is to have a durable economic recovery and put itself on a credible pathway to build a thriving net zero emissions economy, then the Government must put ambitious and well-designed environmental regulations at the heart of economic policy making.”

Joan Walley, Chair, the Aldersgate Group, said: "The government's binding commitments to zero carbon and to nature protection need a detailed delivery plan. Evidence-based environmental regulations are integral to this and sustainable prosperity. Aldersgate Group's members have first-hand experience of best practice on this and are leading the call for ambitious environmental standards."

Emma Howard Boyd, Chair of the Environment Agency, said: “The UK Government hosts the G7 and the COP26 climate conference this year where discussions will focus on the economic recovery opportunities in decarbonisation and restoring nature. We have everything to gain from this in terms of jobs, trade, green goods, services and technologies. But, if polluters don’t pay and enforcement activity is underfunded, then bad practitioners will undermine the leadership and ambition of many British businesses. The Green Industrial Revolution needs strong Green Industrial Regulation.”

Maria Smith, Director of Sustainability & Physics, Buro Happold, said: “As a society, we're facing huge interconnected economic and environmental challenges that have been exacerbated and laid bare by the Covid-19 pandemic. This report shows how ambitious environmental regulation can help the Government facilitate prosperity and create the infrastructure for a thriving business landscape that meets the UK's environmental targets.”

Gabrielle Ginér, Head of Environmental Sustainability, BT Group said: “With the second largest commercial fleet in the UK, we’ve outlined plans to electrify up to 28,000 of our vehicles by 2030 and we’ve successfully campaigned for an end to petrol and diesel vehicles sales by the end of the decade. We now need the UK Government to make sure that the right policies and regulation are in place to support the mass adoption of electric vehicles - focussing on supply, price and availability of infrastructure such as charging points across the country.”

Martin Casey, Director Public Affairs Europe, CEMEX, said: “CEMEX very much welcomes this important report from Buro Happold for the Aldersgate Group; having well designed, clear and properly enforced environmental regulations is a pre-requisite to our business being able to operate efficiently. They enable us to make the right investments and decisions, and give confidence to our employees, neighbours, shareholders, and investors alike.”

Tim Jackson, Professor of Sustainable Development and Director of the Centre for the Understanding of Sustainable Prosperity, said: “This timely report finally busts the age old myth that regulation holds back prosperity. Ambitious, forward-looking, consistent regulation has the potential to deliver a resilient green recovery: healthier lives, better jobs and a more sustainable economy.”

Chris Smith, Managing Director, Michelin Tyre PLC, said: “Michelin believes strongly that sustainability is the key success factor of any company. This means reuniting profit, care for people and protection of the planet. Our commitment to sustainability can only fuel our belief that the recovery from the current crisis can only be green. With talk of building back better and building back greener, now is time for government to be bold and use environmental regulation to ensure that we are on track to meet the decarbonisation targets set out in the Paris Accord and help achieve the benefits of the circular economy through enhanced resource efficiency.”

Olivia Whitlam, Head of Sustainability, Siemens plc, said: “Long term direction setting supported by appropriate incentives is critical to creating the certainty that business needs to help deliver on the UK’s Net Zero target. As this report shows, smart and well targeted regulations have the potential to drive innovation in the Infrastructure and Transport sectors, leading to job creation and helping to facilitate a fair transition to the sustainable and resilient economy we all want to see.”

Dr Adam Read, External Affairs Director, SUEZ, said: “Regulation has been key to driving innovation and investment in the waste sector for many years. With significant reform to waste and resources policy underway, our sector is expected to play a central role in delivering both a green recovery and a transition to a more circular economy. Appropriate and consistent regulation will ensure emerging policies fulfil their potential. A more integrated approach to policy setting and regulation will promote the investment and innovation needed to deliver the economic and environmental benefits of a resource efficient economy and drive decarbonisation in other sectors.”

Julia Barrett, Chief Sustainability Officer, Willmott Dixon, said: “We warmly welcome this briefing from the Aldersgate Group. With construction and operation of buildings accounting for nearly 40% of global carbon emissions, Willmott Dixon has long advocated that well-designed and effectively enforced environmental regulations are a driver for enhanced business performance and growth. With the drive to net-zero this is truer now than it has ever been, providing the imperative to innovate and improve, to unlock opportunities for ourselves, our customers, our supply chain partners and the communities we work in.”

—ENDS—

Notes to Editor

The Aldersgate Group is an alliance of leaders from business, politics and civil society that drives action for a sustainable economy. Our members include some of the largest businesses in the UK with a collective global turnover of over £550bn, leading NGOs, professional institutes, public sector bodies, trade associations and politicians from across the political spectrum. Our mission is to trigger the change in policy required to address environmental challenges effectively and secure economic benefits for the UK in doing so.

Buro Happold is an international, integrated consultancy of engineers, consultants and advisers. Operating in 26 locations worldwide, with 54 partners and over 1,900 employees; for over 40 years we have built a world-class reputation for delivering creative, value led solutions for an ever challenging world. 

[1] Fostering Prosperity: driving innovation and creating market opportunities through environmental regulations is written by BuroHappold and commissioned by the Aldersgate Group. The full report can be found here.

[2] Department for Business, Energy and Industrial Strategy (2 February 2021) Taskforce on Innovation, Growth and Regulatory Reform (TIGRR) Terms of Reference

[3] The key findings of the report will be presented at a webinar on Tuesday 2 March at 9.30am, which will include a range of business speakers and a keynote speech from Emma Howard-Boyd, Chair of the Environment Agency. To attend the event, please register here.

[4] Greater London Authority (2018) Monitoring the implementation of the London Plan Energy Policies in 2018

[5] BuroHappold (2017) Help or Hinderance? Environmental Regulations and Competitiveness

WRAP (2020) How Moving to A Circular Economy can help the UK to Build Back Better

[6] Cambridge Economics (2020) The impact of a 2030 ICE phaseout in the UK, commissioned by Greenpeace


Beyond red tape: smart regulations are key to delivering UK industrial and environmental ambitions

7th December 2017

Today the Aldersgate Group launches a report by engineering consultancy BuroHappold, Help or Hindrance? Environmental regulations and competitiveness, which looks at the impacts of ambitious environmental standards on business competitiveness, skills and innovation.

The report, which is based on interviews in the waste, construction and car industries, concludes that well-designed environmental regulations can deliver positive economic outcomes in the form of increased business investment in innovation and skills, better quality products and infrastructure, greater business competitiveness and job creation. 

This report will be launched at an event in Parliament today, 7th December with keynote speaker Claire Perry MP, Minister of Climate Change and Industry [1].
 
The report, commissioned by the Aldersgate Group and written by BuroHappold, is based on business interviews studying the impacts of three key environmental regulations in the buildings (London Plan), waste (Landfill Tax) and car (EU Regulations on passenger cars) industries. It concludes that the compliance cost attached to each regulation has been more than offset by the economic benefits they have triggered. These include increased business investment in innovation and skills, better quality and performing products and infrastructure, greater business competitiveness and net job creation.

Examples include:

  • The low carbon infrastructure (heat networks and renewables) development required under the London Plan for building planning applications in 2015 is estimated to have created around 4,000 full-time equivalent jobs in the design, consultancy, construction and manufacturing parts of the supply chain;
  • The Landfill Tax helped trigger significant investment by the waste industry in new infrastructure and services (such as investment in waste recovery, sorting and recycling facilities), while also cutting the amount of waste sent to landfill by 72% in 20 years;
  • The EU passenger car and light vehicles CO2 regulation has provided a consistent and clear legal framework. Car manufacturers and suppliers have responded by developing an innovative, competitive and highly collaborative industry, with automotive companies now ranking third in R&D investments globally.

However, the report also highlights flaws in each of these regulations (from poor regulatory enforcement to a lack of focus on supply chain skills), which hold valuable lessons for designing the policies needed to deliver the Government’s objectives under the recently published Industrial and Clean Growth Strategies. To maximise environmental and economic benefits and avoid unintended impacts, well-designed regulations need to:   

  • Be pitched at the right geographic scale;
  • Provide a clear, stable sense of direction;
  • Be coherent with existing policies;
  • Be implemented in a way that works with business timescales;
  • Be accompanied by complementary policies (such as on skills and regulatory enforcement). 

Nick Molho, Executive Director, Aldersgate Group, said: “With clean growth positioned as one of the four Grand Challenges of the Industrial Strategy [2] and the recent Clean Growth Strategy promising to drive growth of the UK’s low carbon industries, the report comes at a crucial time to show how environmental regulations can act as a help rather than a hindrance to innovation and growth, whilst also delivering positive environmental outcomes.

The government recognised in the Industrial Strategy White Paper that regulations shouldn’t just be seen as red tape; on the contrary, they can also act as an important tool to support business innovation and competitiveness. The challenge ahead will be to ensure that regulations to deliver the UK’s environmental and industrial objectives are sufficiently ambitious, stable, practical and compatible with other policy objectives.”
 
Duncan Price, Director of Sustainability, BuroHappold and author of the report, said: “There is no inherent conflict between well-crafted policy and economic gains. When well designed and complemented by effective economic and industrial policies, smart regulations can deliver positive environmental and economic outcomes. Insights derived through this work hold valuable lessons for the government as it works to deliver its Industrial and Clean Growth Strategies.”
 
Sarah Cary, Head of Sustainable Places, British Land, said: “British Land is supportive of Government regulation to drive carbon efficiency in real estate and construction, helping the UK to lead the world in developing low carbon systems and services. A clear medium-term vision for future energy and carbon policy will drive millions into construction product innovation investment and upskilling for hundreds of thousands of workers. And, in challenging the industry to innovate, Government creates an opportunity for UK architects and manufacturers to become global leaders in energy efficient building design.”
 
Dr. Adam Read, External Affairs Director, SUEZ, said:
“Regulation has been at the heart of the positive evolution of the UK waste and resources sector, driving quality, delivering recycling and reducing our reliance on landfill, and landfill tax has been critical to this journey. We now have the opportunity to look to the future with an Industrial Strategy and a new Waste and Resource Strategy due where policy, regulation, and market incentives can come to the fore to help shape the Britain of tomorrow.”
 
Andy Walker, Technology Director, Johnson Matthey, said: “Regulating emissions at source is not only beneficial to the environment and human health, but also strongly drives innovation. Well considered regulations taking account of local and global considerations, signalled far enough in advance, provide scope for companies throughout the supply chain to innovate and plan for commercialisation, thereby maximising the economic benefits that can accrue from reducing the environmental impact of the vehicle fleet.”

[1] Help or Hindrance? The role of environmental regulations in the Industrial Strategy. This event will be held from 9.00am-11.00am on 7th December, 2017 in the Macmillan Room, Portcullis House, Westminster. The event, hosted by Peter Aldous MP, will feature a keynote speech from Claire Perry MP, Minister of State for Climate Change and Industry and Duncan Price, Director of Sustainability at BuroHappold. Panellists include Emma Howard Boyd, Chair, Environment Agency, Sarah Cary, Head of Sustainable Places, British Land, Dr. Adam Read, External Affairs Director, SUEZ, and Graham Willson, Chief Executive, British Tyre Manufacturers' Association Ltd. 
 
[2] Industrial Strategy: building a Britain fit for the future, HM Government, November 2017 https://www.gov.uk/government/publications/industrial-strategy-building-a-britain-fit-for-the-future


EU environmental legislation adds value to UK businesses

22nd February 2016

Reacting to the Prime Minister’s announcement today on an EU referendum to take place on 23 June, the Aldersgate Group issued the following statement on the importance of EU environmental legislation for UK businesses.

High quality environmental legislation is good for the economy, for business and for citizens. EU environmental legislation has provided to date important benefits for UK businesses and the environment. Many environmental issues such as climate change and air quality are transnational in nature and other environmental issues, whilst not always or necessarily transboundary (e.g. water pollution), are common to many member states.

Whilst some improvements must be made, EU legislation has helped tackle some of these challenges in a more environmentally and economically effective manner by pooling the resources of different member states to address a particular environmental concern and driving environmental and business innovation across the EU. Membership of the EU has also strengthened UK diplomatic efforts in international negotiations such as recently at the climate change summit in Paris.

The UK has at times been a major player in the improvement of EU environmental legislation such as on emissions trading and industrial pollution; however, EU legislation has often resulted in standards that have resulted in a higher degree of environmental protection than would have otherwise applied in the UK. For instance, EU legislation has been the principal driver of rising UK standards on air and water pollution with major health benefits - the Bathing Water Directive has driven real improvements in beach water quality and benefitted tourism. The Environment Agency has stated that the Landfill Directive has changed for the better the way that waste is managed in the UK. The Birds and Habitats Directives have led to substantial improvements in the standards of protection for habitats and species in the UK.

In addition to addressing environmental issues cost-effectively, EU legislation has resulted in the introduction of common environmental and product standards which have been beneficial to UK businesses by providing more of a level playing field across different member states and providing clear market signals on the standards that products and services being developed on the Single Market need to meet. These standards have also often resulted in cost reductions for consumers, for instance DECC predicts that tighter efficiency standards for household energy appliances are expected to deliver an average annual saving of around £158 per household in 2020 (including around £25 per household through more efficient TVs and set-top boxes, £25 through more efficient consumer electronics and around £20 through more efficient lighting).

There are undoubtedly areas of European environmental legislation that could be improved and made more effective, in particular through more consistent implementation across member states and a greater focus on looking at environmental issues as a whole when developing policy to avoid unintended impacts. This could help avoid instances where some areas of EU legislation undermine its environmental objectives such as the European Court of Justice ruling last June that the UK’s reduced 5% VAT rate on energy-saving products was in breach of EU laws. However, the UK is most likely to have some influence in supporting these improvements and ensuring that the interests of its businesses are recognised and promoted if it continues to be part of the EU.

Should the UK leave the EU, the government must ensure that the UK continues to abide by environmental standards of at least a similar threshold to those contained in existing European legislation and applied across the Single Market. This is particularly the case in key areas such as product efficiency, fuel efficiency, industrial pollution and climate change. However, no clarity has been provided to date as to how this would be done and how the future development of these standards and legislation could still be influenced by the UK in the event that it was no longer part of the EU. 

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Aldersgate Group supports Defra regulation challenge

24th September 2012

The Aldersgate Group is working as a key stakeholder on the Department of Environment Food and Rural Affairs (Defra)'s "Smarter Environmental Regulation Review". This review seeks to build on the findings of the Red Tape Challenge, reforming legislation over the long term.

Peter Young, Chairman of the Aldersgate Group and a member of Defra's Critical Friends working group, said the priority is "to reduce the burden of environmental regulation whilst securing better environmental outcomes."
 
Defra has submitted suggestions for changes to guidance and reporting requirements to ministers and an announcement is pending.