From leader to laggard: The fall and fall of the UK’s climate optics

Prime Minister Rishi Sunak is set to cut the UK’s international climate finance spending just days after his advisors warned him that the nation is no longer considered a green leader on the international stage. In her new blog, edie’s deputy editor Sarah George asks: Where did it all go wrong – and how can businesses stop it from getting worse?

From leader to laggard: The fall and fall of the UK’s climate optics

Image: 10 Downing Street, CC-BY-NC-ND 2.0.

edie readers will have woken up this morning (5 July) to the Guardian’s exclusive on Sunak’s preparations to cut the UK’s flagship pledge to provide £11.6bn of international climate and nature funding this year.

The pledge was initially made by Boris Johnson at COP26 in 2021, with Sunak also present in Glasgow as Chancellor.

Sunak is arguing that the pledge can no longer be delivered with the current economic pressures in mind, but the optics are objectively terrible given the timing of the news – a fact that has been raised already by COP26 summit president Alok Sharma.

Just last week, the Climate Change Committee (CCC) concluded that the UK is no longer regarded as a world leader on climate.

It has failed, Committee members explained, to back its flagship 2050 net-zero commitment with credible delivery plans. It is also making decisions that seem hypocritical on the world stage. Pulling funding after promising it (and repeatedly reaffirming it) follows on from gaffes like the approval of the first deep coal mine in more than three decades or the provision of international finance to a mega-gas project in Mozambique.

The irony has not been lost on me that this week (1-7 July) is the UK Government’s Net-Zero Week – an industry-backed awareness-raising campaign intended to increase public participation in the net-zero transition and provide practical advice for organisations of all sizes and sectors.

Sunak could have used the week to increase ambitions, especially given Zac Goldsmith’s ministerial resignation last week, in which Goldsmith said Sunak was “personally unmotivated” to tackle “the biggest challenge of our time”. Instead, Sunak has seemingly made things worse.

You’d be forgiven for thinking that Net-Zero Week is a cursed campaign. It was initially meant to go ahead in the second half of 2022 but was rescheduled as the original dates coincided with Liz Truss’s resignation. This came after a 45-day tenure that is remembered across the green economy for U-turns on the fracking ban and misinformation on solar farms, but also the commissioning of Chris Skidmore MP’s Net-Zero Review.

International competition

Skidmore’s Review made crystal clear that the UK is not yet designing policy and regulation to properly realise the full social and economic benefits of the net-zero transition. With a PM in place who uses rhetoric regarding economic growth above all else, there is perhaps little wonder that he appears disinterested.

Part of the missed opportunity, Skidmore highlighted, was the UK’s failure to scale emerging cleantech markets for export as rapidly as international competitors. He noted China’s ever-growing wind and solar strength, plus hotter global competition in fields like hydrogen and electric mobility.

Competition has only increased since the Review was published in January. The EU has readied its response to the US’s multi-billion-dollar Inflation Reduction Act, for one. A UK version was slated for the Spring Statement but was pushed back to this Autumn’s budget by Chancellor Jeremy Hunt.

Since then, all manner of individuals and organisations have been pressing Hunt to provide a strong signal to industry ahead of the Budget to prevent another let-down.

The call isn’t only coming from the renewables and electric vehicle industries. The Conservative Party prides itself on being the option for businesses, so you’d expect Ministers to take notice when the Confederation of British Industries (CBI) warns them of £4.3bn in squandered opportunities this decade.

Even the UK Petroleum Industry Association (UKPIA) thinks the Government is letting too much energy transition investment go overseas, and is calling for better carbon levies and other policies to derisk investment in emerging cleantech.

A moment for action

In a nutshell, it’s hard to disagree with Goldsmith that Sunak does not have robust plans to be on the side of climate once you read the full CCC report. The Government also seems to be struggling to be on the side of business. edie readers will know that these sides are one and the same.

Thankfully, the Chancellor seems to also recognise that what is good for the environment is good for the UK’s long-term economic stability, both in terms of avoided risk and new innovation and export opportunities. He has previously stated that growing the UK’s low-carbon sectors will be as important as boosting its digital industries and investing in next-generation healthcare.

Moreover, more than 100 Tory MPs and Lords are members of the Conservative Environment Network.

There are voices in Parliament who are listening and who have a degree of influence on Sunak and his Cabinet. It is time to push them to turn their stated care about sustainability – environmental and social paired with economic – into concrete change.

Around four months remain until the Autumn Statement, when the UK’s response to the US and EU’s green economy subsidies is expected. Less than a month after that, COP28 will get underway in Dubai.

The UK’s green economy has an opportune moment to spell out that UK Plc will not stand for further delays to policy interventions that will enable us to re-position ourselves as a global leader in the deployment – and export – of low-carbon technologies.

The time is also ripe to let the Government know why cutting international climate aid may save money now, but that failure to deliver adaptation and mitigation in the Global South will store up billions of pounds of risk for the decades to come. Moreover, it could further damage the trust of developing and emerging economies in the entire COP process.

The trust of the UK’s own citizens is also at stake. As highlighted in the Skidmore Review, people are concerned that, without a proper skills plan from the Government, the net-zero transition will cost them their livelihoods rather than providing them with an opportunity for better jobs.

They are also still finding things like heat pumps and electric cars too expensive and struggling to access alternatives that should be affordable, like good public transport. This is feeding into a media vendetta against any and every low-carbon technology in titles like the Daily Mail and Telegraph.

The net-zero transition needs unprecedented deployment of technologies but will ultimately be won or lost with hearts and minds. If the Government won’t clearly show the social and economic benefits of a well-managed transition, it is incumbent on others to lead the way (at least until the Autumn Statement, if we are to be optimistic).

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