The Industrial Strategy Council, chaired by Andy Haldane, the Bank of England's chief economist, has said that the investments the government has made in green policy "are not yet a practical road map for delivering net zero, with several areas lacking the required scale to make progress at the required speed".
Examining the government's “Plan for Growth”, released on 3 March, the council has found the plan to contain “some concrete policy proposals”, but “the scale of the challenge very likely exceeds the commitments made so far”.
The report analyses PwC’s findings that “£40 billion of investment is needed every year for the next decade to meet the net zero target. Of the £12 billion announced in the ten-point plan, only £3 billion was new money.”
The prime minister has previously focused on hydrogen as a silver bullet for green policy, but has only allocated £240 million in investment, compared with €7 billion in Germany.
The report notes the government’s reliance on private sector investment, as the plan aims to attract “three times the committed public sector investment”.
However, they have found that “Despite progress to encourage private investment, including through climate-related financial disclosures by the financial sector, the scale of this challenge looks considerable.” Instead, a recent report by a coalition of NGOs found that the world’s biggest 60 banks have provided $3.8tn of financing for fossil fuel companies since the Paris climate deal in 2015.
Policy coordination between local and national government was also highlighted. “Local authorities will have an important role to play in achieving net-zero by leading the governments work on decarbonising sectors such as housing and transport.” Recent clashes between local and national governments on issues such as the MCM coal mine plans in Cumbria illustrate the claim.
Meanwhile, the government has offered to help the North Sea oil and gas industry by investing up to £16bn, on the condition the industry cut its carbon emissions by 50% by the end of the decade.
The council also recommends that the government set up a "rigorous oversight" body to ensure that taxpayer funds are well spent. This comes after Kwasi Kwarteng announced the abolishment of the IndustrialStrategy Council on 4 March, a council of industry leaders who had been tasked with doing just that.