VAT reductions to encourage energy efficiency, the use of recycled materials, and repair services are among recommendations MP’s makes today as they publishes its report on how to ‘grow back better’ after covid-19 – to create a greener, healthier and more resilient economy.
The cross-party Environmental Audit Committee warns that if the economic recovery from covid-19 is not used as an opportunity to ‘grow back better’, climate change and biodiversity collapse may deliver an even greater crisis.
While the Prime Minister’s Ten Point Plan for a green industrial revolution points in the right direction, it is not yet investible and underlying strategies need to be published rapidly to give industry confidence. The report calls for the Government to front-load its investment in areas such energy efficiency, the circular economy, climate adaptation and nature recovery, to counter rising unemployment by creating green jobs. The EAC heard that this investment will provide economic multipliers in terms of jobs and improved productivity and will offer wider benefits such as cleaner air and warmer homes.
Infrastructure invested in now will be in use for decades to come. It is essential that all decisions on infrastructure investment comply with the UK’s air quality, biodiversity protections and climate change commitments.
ChairmanPhilip Dunne MP, said:
“The Covid-19 crisis must be treated as a wake-up call. It is a symptom of a growing ecological emergency. The economic recovery will shape our national economy for decades to come, and it is crucial that tackling climate change and restoring nature is at its core.
A tax system fit for net-zero Britain is key. It will encourage innovation, give confidence to the sector and support companies to make the low-carbon transition.
There are endless initiatives that can lead to a greener future and the Chancellor should use his upcoming Budget statement to start this process. Boosting energy efficiency of homes by reducing VAT on retrofits can spur growth in low-carbon manufacturing. The funding allocated to the Green Homes Grant should be rolled over to meet the target to issue 600,000 vouchers. The electric vehicle transition must be accelerated with further tax incentives to encourage take up.
But a greener future hinges on the health of biodiversity and ecosystems. The economic recovery must not overlook nature recovery. Planning and infrastructure decisions must take into account the impact of nature, and piloting a new National Nature Service can protect wildlife while offering employment opportunities.
There will be no vaccine against runaway climate change, and it is our responsibility now, using the opportunity of the economic recovery, to set the UK on track for net-zero.”
The EAC recommends that the Bank of England align its quantitative easing programme with the Paris Agreement. The EAC recommends that its monetary policy remit should include both nature and climate impacts, and any continuation of the covid-19 Corporate Financing Facility (CCFF) should require climate related financial disclosures.