Monday, May 21, 2012

Cameron urged to put green economy at heart of plan for growth

Joan Walley MP

Joan Walley, Chair of the MPs' Environmental Audit Committee, has called on the Prime Minister to show leadership in the run up to the Rio Earth Summit and put the green economy at the heart of the Government's plans to revive the economy.

"Out of the ashes of the financial crisis we need to rebuild an economy that enhances human well-being, protects the natural world and delivers food and energy security for the future," she said, as she launched a new report on the green economy by the Committee of cross-party MPs.

The MPs want green investment to play a key part in the economic recovery, but they feel that the Treasury still regards environmental measures as a cost not a benefit to the economy. Expenditure involved in making the transition to a green economy should be seen as an investment in a positive future, they argue.

The report criticises the existing strategy, 'Enabling the Transition to a Green Economy', for being too focused on voluntary action and failing to set a clear trajectory or any time-bound milestones for businesses to achieve.

Investing in renewable sources of energy would increase our energy security by reducing our reliance on imported fossil fuels and create jobs, it concludes.

What is needed is a green economy strategy, the report says, which is Treasury-led and addresses the economy as a whole, and it calls on the Treasury to publish its definition of an environmental tax. This would enable it to measure whether the Government is meeting its commitment to increase the proportion of environmental taxes.

Mandatory emissions reporting

Defra is also criticised for delaying the introduction of mandatory emissions reporting for big business, and the MPs hope this doesn't mean it will never be introduced.

"Making businesses report their carbon emissions is one of the first steps we need to take on the road to a green economy, so it will be a key test of this Government's green credentials," they say.

"The Government promised a roadmap to a green economy, but two years in it seems to have stalled and we risk slipping back to business-as-usual," added Ms. Walley.

"Rising global demand for commodities and fossil fuels mean that prices will continue to rise in future, so it is incredibly short-sighted of the Treasury not to give businesses clear incentives to use resources in a smarter way."

Defra did, in March, publish its Resource Security Action Plan: making the most of valuable materials, which sets out the risks and opportunities for businesses stemming from our reliance on the specialty metals and minerals used in technology, but it lacks specific targets and financial support to business.

The Government's roadmap to the green economy also lacks long-term vision, the MPs say, warning that the recent financial crisis has shown how great are the risks of relying solely on a market-led approach, particularly when the market value of services provided by nature, such as clean water and crop pollination, are not valued on corporate balance sheets.

Red tape is often a green safeguard

Furthermore, Government plans to 'rationalise' environmental regulations must not be a smokescreen for relaxing rules protecting our health, countryside or wildlife in a short-term pursuit of growth, the report also warns.

The Government has pledged to reduce over 10,000 pages of regulatory guidance, following its 'Red Tape Challenge', to help businesses comply with environmental laws. But the MPs point out they have an important role in safeguarding our health and the environment.

Joan Walley said: "The Treasury seems to see environmental regulations as nothing more than costly red-tape, but what we are talking about here are vital laws to give us clean air, safe food, and a thriving countryside.

"If this process reduces bureaucracy and improves outcomes," she says, “we will support it. But it would be irresponsible to get rid of sensible regulations in a desperate dash for growth."

She said they will be keeping a careful eye on Ministers to make sure that rules are not relaxed unnecessarily.

The MPs therefore urge the Government to:

  • develop minimum sustainability standards
  • set out how data on natural capital in the National Accounts will be used
  • develop targets for improving the state of the environment
  • establish transparent reporting by business
  • use the Natural Capital Committee's work on a 'natural asset stock check' as an indicator to measure the green economy.

Simultaneously, they call for a new definition of the green economy that includes all three interdependent pillars of sustainable development, including the social aspects, well-being and environmental limits.

It also says the Government should set out how it intends to use its procurement expenditure to develop markets for green goods and services, and what specific changes it intends to make to meet the requirements of the Public Services (Social Value) Act.

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