Will Cameron stand by the Green Deal?

The flagship environmental policy is in trouble. If it fails, the PM will want Lib Dems to get the b

The government's elaborate confusion over tax breaks on charitable donations has distracted attention from another intriguing policy row that erupted over the weekend. On Sunday, it emerged that three Tory ministers - Eric Pickles, Chris Grayling and Grant Shapps - are lobbying to have one of the coalition's flagship environmental policies scrapped. The "Green Deal" is a substantial project to insulate Britain's drafty housing stock by creating a consumer market for eco-friendly home improvements. In theory, householders benefit from lower bills and the world benefits from fewer carbon emissions.

Hostile Conservatives worry that the plans will effectively force people undertaking everyday home improvements to pay more in the name of eco-friendliness. They have dubbed the whole thing a stealth "conservatory tax." This is a pretty popular insurgency on the right of the Tory party, where environmentalism is generally suspected of being a false idol. Chris Huhne, the former Energy Secretary who put in most of the work on the Green Deal, has lashed out at Tory critics for "posturing".

From this little skirmish you might easily get the impression that the Green Deal is a Lib Dem policy, opposed by Tories. That isn't quite the case. Greg Barker, the Conservative climate change minister, has defended the programme, pointing out that it is inscribed in the coalition agreement. David Cameron himself has regularly cited it as evidence of his government's eco-credentials. The Prime Minister has, in the past at least, been quite enamoured of the policy. A market-driven device, harnessing the aggregate power of many individual consumers to achieve a great environmental goal and improve Britain's housing stock; bottom-up solutions from ordinary households instead of top-down state meddling - it all seemed so clever, modern, progressive … so big society!

The problem is that it relies on two important drivers over which government has little control: First, private sector companies must offer competitive Green Deal packages and, second, consumer demand has to hold up for the market to work. People will have to borrow money to do the relevant improvements. The policy is designed in such a way that households should always gain more from cheaper bills so, in net terms, they are better off. But in the current climate, borrowing at all is a toxic concept for many people. Industry sources are whispering quietly that the whole project is way off track and might unravel altogether.

Much of the financing early on will end up coming from the fledgling Green Investment Bank. The Department for Energy and Climate Change insists this was always meant to be the case, but that doesn't quite square with the idea of a programme driven by the private sector. It looks more like one government green policy bailing out another one.

Presumably, the Tory ministers sharpening their knives for the Green Deal are well aware that it might fall over of its own accord. Under such circumstances it doesn't do any harm to line up a good we told you so" especially one that plays well with Conservative party grass roots. The interesting thing to watch will be whether Cameron continues to stand by the Green Deal and cite it as a badge of eco-honour or discreetly distances himself from it.

If the PM treats it as a fully fledged coalition policy, Heaven and Earth will be moved to make it work. If, however, Downing Street allows it to be portrayed as a purely Lib Dem initiative a hobby horse of the junior partner, conceived by an ex-Secretary of State currently awaiting trial for a driving offence we'll know the Green Deal is being lined up for the chop.

The Green deal aims to protect house owners against rising heating costs Photograph: Getty Images.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

Photo: Getty
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The big problem for the NHS? Local government cuts

Even a U-Turn on planned cuts to the service itself will still leave the NHS under heavy pressure. 

38Degrees has uncovered a series of grisly plans for the NHS over the coming years. Among the highlights: severe cuts to frontline services at the Midland Metropolitan Hospital, including but limited to the closure of its Accident and Emergency department. Elsewhere, one of three hospitals in Leicester, Leicestershire and Rutland are to be shuttered, while there will be cuts to acute services in Suffolk and North East Essex.

These cuts come despite an additional £8bn annual cash injection into the NHS, characterised as the bare minimum needed by Simon Stevens, the head of NHS England.

The cuts are outlined in draft sustainability and transformation plans (STP) that will be approved in October before kicking off a period of wider consultation.

The problem for the NHS is twofold: although its funding remains ringfenced, healthcare inflation means that in reality, the health service requires above-inflation increases to stand still. But the second, bigger problem aren’t cuts to the NHS but to the rest of government spending, particularly local government cuts.

That has seen more pressure on hospital beds as outpatients who require further non-emergency care have nowhere to go, increasing lifestyle problems as cash-strapped councils either close or increase prices at subsidised local authority gyms, build on green space to make the best out of Britain’s booming property market, and cut other corners to manage the growing backlog of devolved cuts.

All of which means even a bigger supply of cash for the NHS than the £8bn promised at the last election – even the bonanza pledged by Vote Leave in the referendum, in fact – will still find itself disappearing down the cracks left by cuts elsewhere. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.