Osborne encircled on green targets

Businesses join the call for the government to adopt a 2030 decarbonisation target.

Two groups of businesses have joined calls today for the government to adopt a target to decarbonise the power sector by 2030. It leaves George Osborne with few friends for his pro-gas, anti-green approach a year to the day after he warned the Conservative party conference that, "We’re not going to save the planet by putting our country out of business."

Two letters to Ed Davey, Secretary of State for Energy and Climate Change, calling for a 2030 target have been published today. A letter coordinated by the Aldersgate Group was signed by Asda, Aviva, Alliance Boots, BT, British American Tobacco, Cisco, EDF, Eurostar, Marks & Spencer, Microsoft, PepsiCo, Philips, Reed Elsevier, Sky, The Co-operative and Tridos Bank among others. It says:

"The government's perceived commitment to the low carbon transition is being undermined by recent statements calling for unabated gas in the power sector beyond 2030 and the absence of a specific carbon intensity target."

A second letter, leaked to the Times, is signed by Siemens, Alstom UK, Mitsubishi Power Systems, Areva, Doosan, Gamesa and Vestas. It says:

"Historically the UK has benefited from being known as a country with low political risk for energy investments. Undermining that reputation would have damaging consequences for the scale of future investments in the UK energy sector. It is important to protect that reputation carefully...

"We consider that a binding 2030 target for power sector decarbonisation would help to reduce the political risk currently associated with long term UK industrial investment."

Over the summer, two senior Tories joined the call for a 2030 decarbonisation target. Tim Yeo, Chair of the Energy and Climate Change select committee, published pre-legislative scrutiny of the energy bill calling for a 2030 target. In the FT, Yeo called for the government "[to] set a clear target to largely decarbonise the electricity sector by 2030, giving investors certainty about the direction of energy policy."

Lord Deben, formerly John Gummer, a minister in John Major's government, has recently become chair of the Committee on Climate Change. He wrote a letter to Ed Davey endorsing a 2030 target on the grounds that it would help bring forward the necessary investments “at least cost to the consumers.”

In recent weeks, the Labour Party and the Lib Dems have added their support to demands for a 2030 decarbonisation target. It leaves Osborne isolated in his view, captured in a letter earlier this summer to Davey, which called for, "agreement that we will not set any further decarbonisation or deployment targets beyond those we already have, for example 2030 targets for electricity emissions or renewable deployment."

The business community will be hoping that the Chancellor changes his mind today.

Recently installed wind turbines generate electricty in the shadow of Drax, Europe's biggest coal fired power station. Photograph: Getty Images.

Will Straw is Director of Britain Stronger In Europe, the cross-party campaign to keep Britain in the European Union. 

Getty Images.
Show Hide image

Why Theresa May won't exclude students from the net migration target

The Prime Minister believes the public would view the move as "a fix". 

In a letter to David Cameron shortly after the last general election, Philip Hammond demanded that students be excluded from the net migration target. The then foreign secretary, who was backed by George Osborne and Sajid Javid, wrote: "From a foreign policy point of view, Britain's role as a world class destination for international students is a highly significant element of our soft power offer. It's an issue that's consistently raised with me by our foreign counterparts." Universities and businesses have long argued that it is economically harmful to limit student numbers. But David Cameron, supported by Theresa May, refused to relent. 

Appearing before the Treasury select committee yesterday, Hammond reignited the issue. "As we approach the challenge of getting net migration figures down, it is in my view essential that we look at how we do this in a way that protects the vital interests of our economy," he said. He added that "It's not whether politicians think one thing or another, it's what the public believe and I think it would be useful to explore that quesrtion." A YouGov poll published earlier this year found that 57 per cent of the public support excluding students from the "tens of thousands" target.

Amber Rudd, the Home Secretary, has also pressured May to do so. But the Prime Minister not only rejected the proposal - she demanded a stricter regime. Rudd later announced in her conference speech that there would be "tougher rules for students on lower quality courses". 

The economic case for reform is that students aid growth. The political case is that it would make the net migration target (which has been missed for six years) easier to meet (long-term immigration for study was 164,000 in the most recent period). But in May's view, excluding students from the target would be regarded by the public as a "fix" and would harm the drive to reduce numbers. If an exemption is made for one group, others will inevitably demand similar treatment. 

Universities complain that their lobbying power has been reduced by the decision to transfer ministerial responsibility from the business department to education. Bill Rammell, the former higher education minister and the vice-chancellor of Bedfordshire, said in July: “We shouldn’t assume that Theresa May as prime minister will have the same restrictive view on overseas students that Theresa May the home secretary had”. Some Tory MPs hoped that the net migration target would be abolished altogether in a "Nixon goes to China" moment.

But rather than retreating, May has doubled-down. The Prime Minister regards permanently reduced migration as essential to her vision of a more ordered society. She believes the economic benefits of high immigration are both too negligible and too narrow. 

Her ambition is a forbidding one. Net migration has not been in the "tens of thousands" since 1997: when the EU had just 15 member states and the term "BRICS" had not even been coined. But as prime minister, May is determined to achieve what she could not as home secretary. 

George Eaton is political editor of the New Statesman.