Investment-led recovery must be supported by a comprehensive net zero vision

Reacting to the Chancellor of the Exchequer’s Spring Budget today, Nick Molho, Executive Director of the Aldersgate Group, said: “It is welcome to see the Budget acknowledge the importance of an investment-led recovery, which will be essential to supporting the UK’s economic growth and the development and deployment of low carbon technologies and services [1]. Whilst today’s announcements set a useful framework towards economic recovery, there are a number of significant missed opportunities within key areas such as housing and transport that must be picked up in the Government’s upcoming net zero strategy, which needs to provide a cross-economy roadmap to reach our net zero target by 2050. [2]”

Nick Molho added: “The establishment of the first UK Infrastructure Bank in Leeds is a crucial step in this journey, with an initial capitalisation of £12bn and £10 billion of guarantees. We would urge Government to include environmental objectives in the Bank’s remit in order to increase the UK’s resilience in the long-term. [3] Further information on the UK’s first sovereign green bond is also welcomed, but it will be essential that the funding is aligned with our net zero objectives in order to support a sustainable economic recovery. The recognition of net zero and sustainability in the updated remit of the Monetary Policy Committee of the Bank of England is also a helpful signal to support the transition to a low emissions economy.”

Nick Molho added: “However, the Budget falls short of providing certainty for the housing sector by not explicitly setting out further funding for the Green Homes Grant. This is a concerning omission and one that must be rectified at the earliest opportunity with additional policy measures that address supply chain and skills issues. This clarity and support will be vital in decarbonising the housing sector, alongside regulatory standards and fiscal incentives to support investment in energy efficiency and low carbon heat.”