A GREEN NEW DEAL IN THE UK - New Economics Foundation
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
A GREEN NEW DEAL IN THE UK
WHY A UK GREEN NEW
DEAL IS WHAT POST-
BREXIT BRITAIN NEEDS
INSTEAD OF SLEEPING WALKING INTO
THIS CLIMATE CRISIS WE SHOULD USE THIS
NEED FOR ACTION TO TRANSFORM OUR
ECONOMY SO IT WORKS FOR EVERYONE
C “
limate change has muscled
its way back onto the political
agenda. Recently MPs debated
climate change for the first time in two THE COST OF
years. It seems that the momentum
around the Alexandria Ocasio-Cortez INACTION – NOT
and Senator Ed Markey’s Green New
Deal in the US, the audacious climate JUST IN POUNDS
march on Westminster by school
children last month and increasingly BUT IN HUMAN
rising temperatures may have finally
jolted our politicians out of their SUFFERING – WILL
climate stupor.
FAR OUTSTRIP
Six months ago, a group of experts
on the Intergovernmental Panel on
Climate Chance (IPCC) delivered
the news that the world must halve
THE COST OF ANY
GREEN NEW DEAL
“
carbon emissions in a little over a
decade. Responding would require
an almighty push to green our
economy – one that would touch on But the IPCC report was a sobering
every aspect of our day-to-day lives. wake up call for many. A growing
Despite this stark warning from the movement of activists in the US,
scientists, the political establishment in backed by new Congresswoman
Westminster barely flinched. There was Ocasio-Cortez and a new generation
no commitment to redouble our efforts, of Democrats, including the Justice
no renewed urgency or call to action. Democrats, are reacting with the
Instead our politics continued to be urgency it demands. The Green
consumed by Brexit. New Deal – an idea that came
2from organisations including the the economy and we should do this
New Economics Foundation (NEF) in a way that works for the majority of
a decade ago – has emerged as a people. Environmental justice working
forceful response. The idea is simple: in tandem with social justice.
an unprecedented mobilisation of
resources to achieve 100% renewable Many people have and will continue
energy and “eliminating greenhouse to say that a Green New Deal – or
gas emissions” within a decade whilst anything equally ambitious designed to
creating millions of jobs and lifting tackle climate breakdown – is a pie in
living standards. the sky idea, or something that would
be good to do but is just too expensive.
At its heart the Green New Deal is a Meanwhile younger generations have
recognition that climate change and taken to the streets to make themselves
the wider threat to our environment heard and have made clear that, for
is a symptom of an economic system them, the ludicrous thing would be to
that is broken. The same economic sit back and do nothing. The political
system that has delivered a decade class should take inspiration from these
of wage stagnation, left millions of brilliant climate strikers – they could
people feeling squeezed and led to learn a lot, not least about urgency and
rising poverty and inequality. To tackle scale of ambition.
climate change, we must transform
“ RESPONDING TO THE LOOMING
CLIMATE CRISIS WILL REQUIRE AN
ALMIGHTY PUSH TO GREEN OUR
ECONOMY. IF OUR POLITICIANS CAN
SHAKE THEMSELVES OUT OF THEIR
BREXIT BIND, THEY MAY JUST SEE
THAT HERE LIES THE AGENDA FOR
POST-BREXIT BRITAIN – ONE THAT
COULD RADICALLY TRANSFORM OUR
“
ECONOMY SO IT WORKS FOR PEOPLE
AND PLANET 3“
As global temperatures rise, extreme
weather events like devastating
hurricanes, record droughts, extreme
floods increase, coastlines disappear
and food becomes more scarce from
WE HAVE
loss of crop-yield and fisheries – the
climate-related poverty we will see
A CHOICE
across the world will be at a scale we
can’t even imagine. And this will be
TO TAKE
the true cost of inaction – not just in
pounds but in human suffering – far CONCERNED,
outstripping the cost of any Green New
Deal. DELIBERATE
Therefore, the choice before us is
whether we take concerned, deliberate
ACTION
action now to achieve the change we
need or we sleepwalk into a crisis and
NOW TO
throw money at the problem in a panic
when it will be too late. When viewed ACHIEVE THE
like this, a Green New Deal becomes a
no-brainer. CHANGE WE
But to be transformative and rise to
the scale of the challenge, a Green
NEED OR WE
New Deal for the UK will need to get
three key things right. First, it must SLEEPWALK “
be ambitious – radical reductions in
carbon emissions in the next decade. INTO A CRISIS
Second, it will require significant
government action – from large-scale
investment in green infrastructure and
technology to incentives and regulation and work in their interest. This will
to bend markets that have been slow to mean collective ownership of green
act towards the climate imperative. infrastructure, public goods and
assets and more co-operative ways
Third, in return for consenting to this of organising new industries that will
scale of change, there has to be a good spring up. Get this right, and we could
deal for the public. A promise to create radically transform our economy so it
millions of good, high wage jobs in works for people and planet. And if our
place of those that will be lost and a politicians can shake themselves out
much bigger stake in the new economy of their Brexit bind, they may just see
that we will create. The green economy that here lies the agenda for post-Brexit
that emerges must be owned by people Britain.
Miatta Fahnbulleh is CEO of NEF
4WHAT IS A GREEN NEW DEAL?
At its heart, the Green New Deal is a The Green New Deal is not the answer
recognition that climate change and to all of our problems, but the massive
the wider threat to our environment wave of government-led investment
is a symptom of an economic system that is needed to tackle climate change
that is broken. The same economic can also:
system that gave us the financial crisis
and austerity has delivered a decade • Create thousands of new,
of wage stagnation, left millions of decent jobs, not only in ‘green’
people feeling squeezed and led to energy sectors, but also in
rising poverty and inequality. To tackle construction, manufacturing,
climate change, we must transform waste management, technological
the economy and we should do this innovation, land use management
in a way that works for the majority of and whole range of other sectors.
people: environmental justice working • Help households and the economy
in tandem with social justice. save money by insulating millions
of people’s homes and bringing
The question that everyone is asking is: the latest micro energy generation,
is this doable or simply a pipe dream? saving and storage technologies
But this is completely the wrong within everyone’s grasp.
question. The question we should be • House people affordably through
asking is: can we get away with not the construction of millions of new
taking action on climate change. If zero carbon homes, including 3.1
the science is right, then the answer million for social rent.
is no. The more global temperatures • Benefit households and the
rise, the more chaos in the system: economy, ease congestion and
more devastating hurricanes, record slash transport emissions by
droughts, extreme floods, coastlines developing local and regional
disappearing, food scarcity from loss integrated public transport
of crop yields and fisheries – all driving networks.
climate-related poverty across the • Transform and rebuild
world. communities through the
implementation of green new
At the same time the UK economy deals at the local authority and
is in urgent need of investment. city region level, unlocking the
Austerity and an over-reliance in the potential of places that have been
economy on financial services has branded as ‘left behind.’
undermined living standards, hastened
the slow decline of manufacturing and
overlooked key ‘foundational’ sectors of
the economy such as energy, housing
and social care.
5THE IMPORTANCE OF PLACE
LOCALISING THE GREEN NEW DEAL
As well as growing income and wealth There cannot be a repeat of the
inequality, the UK also suffers from decimation of communities that took
an inequality of place. The economy place as coal mines were closed in the
of the wealthy south-east of England 1980s and 1990s.
has streaked ahead the rest of the UK
and the gap is still growing: in 2017, One key part of a Green New Deal
gross value added – the main measure therefore must be to focus resources,
of economic production – grew by 3% political attention and support on
in London compared to an average of places that are likely to be most
1.9% elsewhere and 0.7% in Yorkshire negatively affected. Not only does this
and Humber1. Within each nation and mean implementing bold, industrial
region this pattern is repeated, with transformation plans for these places,
the centres of core cities enjoying but it also requires putting people
greater prosperity than surrounding who currently rely on more polluting
conurbations, smaller cities and towns. industry in the driving seat of change,
allowing them to shape their future,
This phenomenon intersects with and backing their plans.
an industrial malaise, with many of
those places branded ‘left behind’ This process must bring central
still reliant on carbon intensive and government, local authorities,
environmentally harmful forms trades unions, workers, community
of economic production. In the representatives and businesses
forthcoming transformation to a low- together and forge lasting relationships
carbon, nature-enhancing, circular through local green new deals.
economy, these places cannot be left
further in the slipstream of progress.
1 ONS (2018) GVA 1998-2017 https://www.ons.gov.uk/economy/grossvalueaddedgva/bulletins/regionalgrossval-
ueaddedbalanceduk/1998to2017
6HOW WILL A GREEN NEW DEAL
BE PAID FOR?
Financing a Green New Deal is not of this planned spend is already
the only challenge that government green, but it also includes a massive
must face – incentives and regulation road-building programme, airports
to bend markets that have been slow expansion and HS2. Redirecting
to change are also key. But without this finance to a green new deal
government-led investment, it will not infrastructural investment would
happen. We must usher in a new era make a significant contribution.
of bold fiscal policy, with government
taxing, spending and investing to 2. Tax things we don’t want to see
crowd-in private finance and business to pay for things we do
investment. One of the most eye catching
elements of Alexandria Ocasio-
If government takes the lead, then Cortez’s crowd-sourced Green
private finance will almost certainly New Deal manifesto3 is its focus
follow, but there are four critical aspects on fairer taxes. We need these
to Green New Deal finance that it is
anyway – for example, the poorest
the government’s role to deal with:
20% of families in the UK pay a
higher proportion of their income
1. Direct existing money to the
in tax4 than anyone else. Taxing
right things
pollution may need to be part of
Globally $2.5 trillion is spent
the mix, but since the burden of
annually on infrastructure, much
these taxes on low income families
of which is either doing little to
can be proportionately high,
reverse environmental harm or
increased taxation of top incomes
is actively contributing to the
and concentrations of wealth
problems. Nearly all infrastructure
needs to make up the lion’s share
is government endorsed or enjoys
of new revenue collection. Care
political support and public
should also be taken to ensure that
finance. In the UK, the current
any new subsidies to incentivise
infrastructure pipeline is worth
cleaner industry and consumption
more than £400 billion2. Some
2 Analysis of the National Infrastructure and Construction Pipeline (Infrastructure and Projects
Authority and HM Treasury) https://assets.publishing.service.gov.uk/government/uploads/system/up-
loads/attachment_data/file/759222/CCS207_CCS1118987248-001_National_Infrastructure_and_Con-
struction_Pipeline_2018_Accessible.pdf
3 Alexandria Ocasio-Cortez’s crowd-sourced Green New Deal manifesto: https://docs.google.com/
document/d/1jxUzp9SZ6-VB-4wSm8sselVMsqWZrSrYpYC9slHKLzo/edit
4 Tapering over the tax: Reforming taxation of income in the UK (Alfie Stirling) https://www.ippr.org/
research/publications/tapering-over-the-tax
7are designed to benefit the UK’s new public assets that deliver both
poorest households more than any social as well as economic returns
others. long into the future.
3. Government must borrow 4. Scaling up Green New Deal
Young people on the climate strikes Finance
today rightly fear they stand to lose Alongside government fiscal policy,
most by today’s collective inertia to the Bank of England must play
tackle environmental change. This a critical role in guiding finance
is unfair. But it is equally unfair for in support of a Green New Deal.
today’s tax payers to shoulder the It has responsibility over large
entire cost of a green transition, swathes of financial regulation
which will also benefit future and could – with support from the
society as well. Public borrowing Treasury – heavily influence the the
is the ultimate tool to pool risk move of private finance away from
through time. By effectively high carbon and environmentally
distributing the repayment of harmful investments and towards
interest across all future tax payers, activities that are Green New
public borrowing allows us to Deal compatible. Its monetary
spread the cost of cleaning our policy operations, such as its asset
economy across the generations. purchases, also influence financial
This form of intervention was used market prices, which in turn
a decade ago to avert financial affects the allocation of private
crisis and it must be used again investment. Meanwhile, the Bank’s
to avert environmental crisis now. ability to buy up government
Only this time the resource will debt can increase the room for
not be poured down a financial manoeuvre on fiscal policy as well.
black hole; instead, we will create
8NOT ONLY CLIMATE CHANGE
BUT ALSO NATURE
While certainly the most urgent, compete in the future, it must become
climate change is not the only entirely resource efficient.
environmental crisis we must avert.
Our natural world is denuded and However, perhaps the most
depleted and our over-consumption tangible and yet least explored area
of resources is rapidly leading to of environmental recovery is the
exhaustion of our planetary life support restoration of biodiversity. For instance,
systems and various forms of pollution, in the past 70 years, more than 98%
such as the shocking build-up of of the UK’s wildflower meadows –
plastics in the ocean. havens for pollinators and other
species – have been lost to agricultural
Globally, the economy that is intensification and development. Tree
the first to understand and build cover in England stands at less than
comprehensive closed loops of 10%, and only 13% in the UK as a
production, where reduction and reuse whole – compared with an EU average
of resources is favoured, even over of 35%5. We must bring back nature
recycling, will be the one that leads everywhere; challenge which, like
the way in the third decade of the climate change, will impact all sectors
21st century. The UK is not currently a of our economy.
pioneer in the circular economy, but to
5 BBC Reality Check: Are millions of trees being planted?
https://www.bbc.co.uk/news/science-environment-41551296
9MOVEMENTS IN THE LEAD
The tone of the debate on climate businesses will all have their moment
change is rapidly shifting. This is not and will each have their role in
because of the work of think tanks or bringing about a Green New Deal. But
green NGOs, but because of radical first we must listen to those taking the
climate activists and children taking lead and support the growth of a Green
matters into their own hands – this New Deal movement, without which
should inspire and direct our actions. none of the truly transformational
changes that are needed and outlined
Politicians, policy experts, campaigning in this pamphlet will be possible or
organisations and progressive sustainable.
10WWW.NEWECONOMICS.ORG WRITTEN BY:
info@neweconomics.org David Powell, Andrew Pendleton,
+44 (0)20 7820 6300 @NEF Miatta Fahnbulleh, Alfie Stirling, Frank
Registered charity number 1055254 van Lerven and Fernanda Balata
© 2019 New Economics Foundation
PUBLISHED:
April 2019
NEF is a charitable think tank. We
are wholly independent of political ACKNOWLEDGEMENTS:
parties and committed to being Thanks to Sofie Jenkinson, Margaret
transparent about how we are funded. Welsh and Clifford SingerYou can also read
