Budget 2017: The green business reaction

Did Philip Hammond pull any big green surprises out of his little red box today? Or were key sustainability issues once again placed on the back-burner in the Chancellor's Spending Review? Here's the full industry reaction, as it comes in...

Taking place at 12:30pm this afternoon (23 November), the Spring Budget provided Chancellor Hammond with a golden opportunity to answer a number of key green policy questions.

Budget 2017: The full story —

Investment for disruptive technologies such as biotech, robotics and driverless vehicles was confirmed during Hammond’s speech, but what about the other major green issues affecting Britain’s business community?

Did ‘Spreadsheet Phil’ announce the introduction of a diesel scrappage scheme, or confirm whether the Carbon Price Floor will continue from this 2020-21? The Chancellor was urged strongly urged to “do the right thing” and to drop the solar tax hike, while a confirmation of the Emissions Reduction Plan would have provided a much-need confidence boost for the green economy. 

With the tax and spending pledges put forward in the 2017 Budget affected by the looming Brexit negotiations, did we see a firm commitment from Hammond to continue to uphold key EU environmental legislations?

In the immediate aftermath, it appears that most of these issues remain on the UK Government’s ‘to-do’ list, as Chancellor Philip Hammond offered little for the green economy to get excited about in his 2017 Budget this afternoon.

Autumn Statement: The green business reaction

James Thornton, chief executive, ClientEarth:

“In today’s budget the Chancellor has missed a golden opportunity to tackle toxic air in the UK.  A first-year charge for new diesels would have been a strong signal that this Government has woken up to the public health crisis of air pollution. Despite being ordered twice by the courts to take urgent steps to tackle the country’s air pollution crisis, it seems the Treasury has still not grasped the urgency of the situation. We fear that Government plans, which are due out next month, may well fall short of what is needed. “

“Hammond made no mention of the air quality crisis in the UK in his statement to MPs. The only mentions of the air pollution crisis were in the written budget documents released on the Treasury website:

“The government is committed to improving air quality, and will consult on a detailed draft plan in the spring which will set out how the UK’s air quality goals will be achieved. Alongside this, the government will continue to explore the appropriate tax treatment for diesel vehicles, and will engage with stakeholders ahead of making any tax changes at Autumn Budget 2017.”

Nick Molho, executive director, Aldersgate Group:

“It was positive to see lots of focus in today’s budget on supporting innovative businesses and ensuring the UK’s workforce has the skills it needs to benefit from the job opportunities of the future. But despite the fact that some of our key trading partners such as China are investing heavily in renewable energy and other clean technologies, there was no reference to the importance of the low carbon sector to the future competitiveness of the UK economy.

“If the UK is to meet the Chancellor’s ambition of being at the cutting edge of the global economy, the Autumn Budget will need to be much clearer about the UK’s environmental and low carbon ambitions and provide a clear business plan to meet the UK’s policy objectives under its Emissions Reduction Plan and 25 Year Plan for the Environment.”

Jacob Hayler, executive director, Environmental Services Association (ESA):

“ESA is pleased that HM Treasury has listened to the industry and adopted measures already in place in Scotland and Wales to tax illegal deposits of waste.

“This will help punish the criminals who undermine legitimate operators in our industry and restrict the option of illegal dumping as a means of avoiding landfill tax.

“We are also pleased to see that the 2020 packaging recycling targets in the Budget are aligned with ESA’s suggestions. In the absence of any real reform of the PRN system, higher targets send the right signals to the sector that the country wants to do better and recycle more packaging in the future.”

Oliver Hayes, air pollution campaigner, Friends of the Earth (FoE):

“The chancellor did nothing to protect our children from the twin threats of toxic air pollution and climate change”

“With thousands of people dying prematurely from air pollution every year it’s astonishing that the Chancellor didn’t act on dirty diesel. 

“A scrappage scheme aimed at the most polluting vehicles, paid for by a one-off charge on new diesel cars, would have been an important step forward in tackling this public health crisis.

“Rapid government measures are needed to clean up the pollution from Britain’s vehicles – but Hammond and May seem to be stuck idling in neutral.”

 Richard Black, director, Energy and Climate Intelligence Unit (ECIU):

“The Chancellor’s statement on carbon pricing indicates that the government is preparing for a Brexit scenario in which the levers driving decarbonisation are pulled entirely nationally. If we come out of the European Emission Trading System, which is likely, a UK carbon price will be essential. But ministers need to say soon what the price will be, because energy companies are already signing power contracts for 2021.”

“The Levy Control Framework was a blunt instrument, and few people will be sorry to see it go. Its worst aspect was that it seemed to make renewable energy more expensive when bills were going down – and logically, that is the time to be investing, when people can most afford it. Whatever replaces it needs to lead the UK towards the smart, flexible power network that, according to the National Infrastructure Commission, will lop £8bn off our national energy bill – which means incentivising things like energy storage, demand-switching and interconnectors.”

IEMA’s Martin Baxter, chief policy advisor, IEMA:

“While we knew this wouldn’t be a radical budget, it’s really surprising how little space and funding the Chancellor dedicated to environment and sustainability. I could say it’s disappointing, but in reality it means we’ve seen a number of missed opportunities for Government to tackle some big sustainability challenges.

“Scrapping the levy control framework without a clear plan of what will replace or supersede it is a real concern; failure to provide clarity will raise significant uncertainty for investment in renewable energy.

“Despite the many oversights, we do welcome the investment on tackling urban congestion as this can potentially underpin improvements to the UK’s air quality – but this must be focused on areas suffering from the highest levels of pollution.

“The introduction of new T Level qualifications to boost uptake of technical skills is a positive move. This will open up new opportunities for young people who are seeking future-fit careers in STEM-related professions, and will contribute to the UK’s low carbon economy.”

Paul Barwell, chief executive, Solar Trade Association (STA):

“We are dismayed that responsible organisations that use their own rooftop solar are still facing an extreme business rate rise of up to 800% from April. Some fossil fuel technologies are already exempt from business rates, and today the Chancellor again took special care of oil and gas. It is surprising that the Treasury’s tax policies tend to yesterday’s technologies while putting clean, modern solar at a competitive disadvantage. The Chancellor says he wants the UK at the “cutting edge of the global economy”- his tax policies for energy risk the opposite.”

“Government continues to cherry pick more expensive technologies while shutting solar out of competitive auctions, even as its industrial strategy prioritises cheap power. This means business and consumers pay over the odds for decarbonisation, and competitive pressure is weak. 

“Suppressing solar in the UK is no way to ‘prepare for a global future’. Solar already dominates clean energy investment globally and it is expected to expand dramatically. It is also set to be the cheapest source of power in the world so countries that embrace solar will have a competitive advantage.”

Trevor Hutchings, director of advocacy, WWF:

“This Budget was a missed opportunity to embrace the potential of green growth to boost our economy and protect our environment. The UK government could have used the Budget as a spring-board to generate hundreds of thousands of new jobs, create new market opportunities, improve UK competitiveness and productivity, and insulate the economy and businesses from growing risks of resource scarcity and climate change. We are already seeing the effect of poor environmental management in the UK from increased flooding through to air pollution. However, the UK government failed to address the problems to our economy and environment, and left them for another day – when it may be too late.”

“The £690m to tackle urban congestion must be used to tackle air pollution and not fund more vehicles on the road. There must be a clear transition towards electric vehicles.”

“The Chancellor said that he would address market failures, but he has not addresses the biggest failure of all, that of climate change. The £270m for disruptive technologies made available to scientists and researchers to develop hi-tech solutions to the challenges we are facing must be channelled into low carbon technology that will not only bolster the economy, but will help us achieve our carbon targets. There needs to be more investment in cutting edge green technologies, and those industries that can aid the low carbon sector such as batteries and smart energy systems.”

Robbie Staniforth, commercial manager at Ecosurety:

“It’s the first indication that we have received from Government that the environment is on the agenda, and we’re pleased to see they’ve opted for a change.

“We’re slightly surprised that they’ve opted for a mix of targets and our only concern is that big recycling jumps may create artificial spikes in PRN prices. As the years progress, it will be important to ensure these PRN revenues generated are directed to improving recycling in the UK.”

Doug Parr, policy director, Greenpeace UK:

“It’s outrageous that Hammond’s Budget is looking to benefit the North Sea oil and gas industry to encourage them to pollute for longer, and taxpayers will have to pay to clean up the oil industry’s mess. Today could have been a turning point for the government’s strategy to invest in the north east. They should be moving away from dirty, old fossil fuels towards backing the thriving offshore wind and smart technology, which could deliver thousands of new skilled jobs.

“Instead of support for modern clean, renewable energy, the Chancellor is seeking to prop up the oil and gas industry of the past. Workers in Scotland and the East of England may be bought off with promises of short term gain, but the oil industry is inevitably declining and the government needs a long-term game plan that looks to support the industries of the future, not the past.”

Cecily Spelling, campaign manager, 10:10:

“It’s the same old mistakes from the Chancellor’s first budget. By shovelling more funding to prop up a failing fossil fuel industry the government is throwing good money after bad. This is while they continue to block cheap, clean energy sources like onshore wind and solar.

“This is the opposite of an industrial strategy. Rather than chasing the dirty fuels of yesterday the government should be helping our oil workers retrain for the good jobs offered by the clean energy system of tomorrow.” 

Follow edie’s live Budget 2017 blog below for a round-up of all of the key green policy announcements and sustainable business reaction, as it happened.

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