By Melanie Kendall-Reid, Director of Business Services
With many calling for a green recovery in today’s budget announcement, at first glance it appears that the climate and natural emergencies have taken a back seat to the economic crisis created by the Covid pandemic. That said, the green financial support announced will give momentum for recent policy change announcements which will drive the UK forward in its net-zero plans and lower emissions from buildings is a positive step forward.
In March 2020, the Chancellor announced multi-million-pound spending for low-carbon transport, renewable energy, natural climate solutions and carbon capture and storage (CCS) which was warmly welcomed across the country. Since then, the world has been hugely impacted in a way that no one saw coming. Worldwide there is the biggest peacetime recession, and the Government has provided unprecedented support for individuals and businesses it is unsurprising that the majority of the announcements were focussed on continued support and economic recovery.
The budget delivered all of the expected measures with Covid support measures remaining in place beyond the anticipated lockdown end in June and a number of tax relief measures to support businesses through the remainder of the year. There was a number of longer-term increases in taxation for businesses which will go some way to recoup funds spent of these measures.
In his speech, the Chancellor re-confirmed his commitment to green growth and an investment led recovery that will see sustainable businesses play a key role. Green economy provisions, consistent with the UK’s long-term climate and environmental targets, included a net-zero Innovation fund, to transition Scotland away from financial reliance on oil and gas, and more detail on the National Infrastructure Bank were announced.
The National Infrastructure Bank will be supported by £12billion from the Treasury and £10billion in Government guarantees aimed at unlocking £40billion in private finance. The detail around how the bank will support the UK net-zero transition with regard to sustainability and environmental requirements was lacking.
There will be eight freeports in England, areas where normal tax and customs rules do not apply, to drive sustainable growth. The free ports will be East Midlands Airport, Felixstowe & Harwich, Humber, Liverpool City Region, Plymouth and South Devon, Solent, Teesside, and Thames and will benefit from additional infrastructure funding, lower taxes, and simpler planning processes.
The UK’s first Green Bonds (Gilts) were announced in November 2020 and the Chancellor took the opportunity today to confirm that these will commence in the Summer with a minimum of £15Billion being issued in this financial year. The funds raised will be directed to renewable or clean energy projects. In a bid to boost sustainable retail finance, the Chancellor confirmed that there will be a support scheme to help retail investors to acquire green savings bonds.
As expected, the Chancellor confirmed the Net-Zero Innovation Portfolio of £1billion funding to be allocated to long-term energy storage; offshore wind; biomass and regenerative agriculture. There was no mention at all of improving energy efficiency in buildings.
Possibly the most disappointing of announcements for the green agenda was the freezing of fuel duty for a 12th consecutive year. Whilst this will be a popular decision for the drivers, it does not encourage the uptake of electric vehicles.
Whilst there were some very big numbers being cited today with regard to the recovery from the Covid pandemic, which is undoubtedly at the forefront of everyone’s minds, it appears that the global climate emergency has taken a back seat at this time. Whilst the Budget announcement is not the only opportunity that the Government has propel the green agenda forward, it was disappointing not to hear more on this topic.
Recent commitments by the UK Government in it’s 10-Point Plan for a green recovery in November last year to create 250,000 green jobs with £12billion investment, and the proposed Future Buildings Standard which will amend Part L of the Building Regulations to achieve low carbon heating and reduce emissions in existing and new buildings will affect businesses and property owners in the coming years to make changes to achieve the requirements.
Whilst the budget may have not brought forward any pivotal green policy announcements today, there is certainly a number of developments that building owners and managers need to plan for and budget for action to be taken. There is only one direction the energy efficiency in buildings can take if we are to achieve our net-zero goals and we are supporting our clients to get ahead of the game.