How British industry is missing out on the green economy

Where's that rose garden Cameron promised?

David Cameron’s husky-hugging Rose Garden pledge to deliver the greenest government ever always felt more like a marketing or branding statement than a policy, containing as it did no specific description of what on earth that would mean in practice. Nevertheless, as a statement of intent it was very powerful.

However, a little over thirty months on from the Rose Garden conference, and Cameron’s pledge to make the Conservatives the environmental party is probably the most discredited of all his pre-election gambits. Remember “Vote Blue Go Green?” – it all seems quite a long time ago. Because despite the strictures imposed by the 2008 Climate Change Act, a series of policy u-turns, relaxations of environmental ambitions and a drip feed of rhetoric stressing the costs rather than the benefits of moving to a green economy, have together contributed to a situation where there is little leadership on the green agenda.

That’s why 11 major property and construction organisations, representing a huge swathe of the £100bn UK industry, last week signed a letter to chancellor George Osborne calling for the government to back a campaign by Building magazine to get behind the green agenda – or risk losing forever the potential the sector holds for major economic growth. The signatories of the letter, and the wider backers of the campaign, represent an unprecedented alliance of interests, from brick-makers and builders to the high-finance property companies that own and develop in our major cities.

The hope is that this unusual alliance, taking in environmentally committed big name architects such as Richard (Lord) Rogers, and red-in-tooth-and-claw housebuilders, will persuade the Chancellor that business doesn’t actually see sustainability and economic growth as something you have to choose between – that you can do both. That, in fact one drives the other: a move toward environmental sustainability will actually deliver growth.

At the moment Osborne has been very clear that this is not how he views the world, telling the Tory conference in 2011 that “a decade of environmental laws and regulations are piling costs on the energy bills of households and companies” and that he wasn’t going to “save the planet” by “putting the country out of business.”

It’s not as if the whole government sees things in the same way: many departments are doing what they can to fight the scepticism from the centre. That shouldn’t be a surprise, as the Confederation of British Industry (that bastion of environmental activism) has called for investment in green growth, saying the “market” accounts for £122bn, or 8 per cent of GDP, and may have accounted for a third of all growth in the economy in 2011/12. But one who has seen government operating up close, former construction tsar Paul Morrell, couldn’t have been clearer when he testified in December: “There clearly is no belief inside Treasury that there is real opportunity of growth in the green agenda. I don’t know why they think that, [because] oddly business does.”

This lack of belief explains a lot – from the government’s u-turns on subsidies for solar power which led directly to one contractor, Carillion, putting 5,000 staff on notice; to the government’s decision to withdraw all previous subsidy regimes for helping householders install insulation, focusing instead on one unproven programme, the Green Deal, with the result that the number of lofts that get lagged each year are predicted to fall by up to 93 per cent. It’s not that surprising that a recent poll by You-Gov found that just 2 per cent believe the coalition has met Cameron’s “greenest ever” pledge.

Another example of where the government has missed a trick is in the cancellation of the planned introduction of something called Display Energy Certificates (DECs), a measure that would have forced offices and shops to calculate and publicly display the energy they use. The measure was pulled despite blanket industry support for its introduction.

Unlike businesses, the Treasury currently seems not to see how targeted and reasonable regulation – as opposed to form-filling bureaucracy – can actually help drive innovation and growth. For businesses it can set a level playing field which stops ethical firms being undercut by fly-by-night operators.

The Treasury instead seems to see lobbying for any green regulation as a form of self-serving bidding for government support by hard-pressed building firms. While the Treasury is right that regulation can in some circumstances falsely create a market for services to comply with that regulation, thereby adding a cost to end users, this view ignores the fact that this particular bit of regulation, DECs, was also supported by the private sector firms who would have paid for the work: the developers and office owners.

Because for them the business case for making investment in green technology is often marginal because it requires significant up-front investment, even though it pays for itself in reduced energy bills over time. To make it really worthwhile they want their clients – building occupiers – to be able to see how green their buildings are, and be able to compare this transparently against their rivals. Then it starts to have a market value. That’s what DECs could have done. But the opportunity was missed.

It’s just one example. The practical impact of this reluctance from government to intervene where there is market failure is that fewer and fewer businesses are seeing investment in sustainability as the key to future profits, because they are less clear that both the market and the regulatory regime are moving in that direction. One chief executive of a major listed contractor told me in the last six months that he had stopped investing in upskilling his business to carry out green retrofitting, because he didn’t see the demand under the current government.

Thus an industry, construction, which represents a tenth of the UK economy, remains in deep recession, dragging down the output of the nation. But beyond this immediate impact, the real risk of not taking a leadership position on the green economy is that an opportunity is missed to take a lead in a global market that is likely to be one of the key industries of the 21st century. The UK could be the country with the skills the rest of the world turns to in order to combat climate change. But not if the current course continues.

The campaign is being tweeted at #green4growth

Cameron’s pledge to make the Conservatives the environmental party is probably the most discredited of all his pre-election gambits. Photograph: Getty Images

Joey Gardiner is assistant editor at Building magazine

Getty
Show Hide image

Is defeat in Stoke the beginning of the end for Paul Nuttall?

The Ukip leader was his party's unity candidate. But after his defeat in Stoke, the old divisions are beginning to show again

In a speech to Ukip’s spring conference in Bolton on February 17, the party’s once and probably future leader Nigel Farage laid down the gauntlet for his successor, Paul Nuttall. Stoke’s by-election was “fundamental” to the future of the party – and Nuttall had to win.
 
One week on, Nuttall has failed that test miserably and thrown the fundamental questions hanging over Ukip’s future into harsh relief. 

For all his bullish talk of supplanting Labour in its industrial heartlands, the Ukip leader only managed to increase the party’s vote share by 2.2 percentage points on 2015. This paltry increase came despite Stoke’s 70 per cent Brexit majority, and a media narrative that was, until the revelations around Nuttall and Hillsborough, talking the party’s chances up.
 
So what now for Nuttall? There is, for the time being, little chance of him resigning – and, in truth, few inside Ukip expected him to win. Nuttall was relying on two well-rehearsed lines as get-out-of-jail free cards very early on in the campaign. 

The first was that the seat was a lowly 72 on Ukip’s target list. The second was that he had been leader of party whose image had been tarnished by infighting both figurative and literal for all of 12 weeks – the real work of his project had yet to begin. 

The chances of that project ever succeeding were modest at the very best. After yesterday’s defeat, it looks even more unlikely. Nuttall had originally stated his intention to run in the likely by-election in Leigh, Greater Manchester, when Andy Burnham wins the Greater Manchester metro mayoralty as is expected in May (Wigan, the borough of which Leigh is part, voted 64 per cent for Brexit).

If he goes ahead and stands – which he may well do – he will have to overturn a Labour majority of over 14,000. That, even before the unedifying row over the veracity of his Hillsborough recollections, was always going to be a big challenge. If he goes for it and loses, his leadership – predicated as it is on his supposed ability to win votes in the north - will be dead in the water. 

Nuttall is not entirely to blame, but he is a big part of Ukip’s problem. I visited Stoke the day before The Guardian published its initial report on Nuttall’s Hillsborough claims, and even then Nuttall’s campaign manager admitted that he was unlikely to convince the “hard core” of Conservative voters to back him. 

There are manifold reasons for this, but chief among them is that Nuttall, despite his newfound love of tweed, is no Nigel Farage. Not only does he lack his name recognition and box office appeal, but the sad truth is that the Tory voters Ukip need to attract are much less likely to vote for a party led by a Scouser whose platform consists of reassuring working-class voters their NHS and benefits are safe.
 
It is Farage and his allies – most notably the party’s main donor Arron Banks – who hold the most power over Nuttall’s future. Banks, who Nuttall publicly disowned as a non-member after he said he was “sick to death” of people “milking” the Hillsborough disaster, said on the eve of the Stoke poll that Ukip had to “remain radical” if it wanted to keep receiving his money. Farage himself has said the party’s campaign ought to have been “clearer” on immigration. 

Senior party figures are already briefing against Nuttall and his team in the Telegraph, whose proprietors are chummy with the beer-swilling Farage-Banks axis. They deride him for his efforts to turn Ukip into “NiceKip” or “Nukip” in order to appeal to more women voters, and for the heavy-handedness of his pitch to Labour voters (“There were times when I wondered whether I’ve got a purple rosette or a red one on”, one told the paper). 

It is Nuttall’s policy advisers - the anti-Farage awkward squad of Suzanne Evans, MEP Patrick O’Flynn (who famously branded Farage "snarling, thin-skinned and aggressive") and former leadership candidate Lisa Duffy – come in for the harshest criticism. Herein lies the leader's almost impossible task. Despite having pitched to members as a unity candidate, the two sides’ visions for Ukip are irreconcilable – one urges him to emulate Trump (who Nuttall says he would not have voted for), and the other urges a more moderate tack. 

Endorsing his leader on Question Time last night, Ukip’s sole MP Douglas Carswell blamed the legacy of the party’s Tea Party-inspired 2015 general election campaign, which saw Farage complain about foreigners with HIV using the NHS in ITV’s leaders debate, for the party’s poor performance in Stoke. Others, such as MEP Bill Etheridge, say precisely the opposite – that Nuttall must be more like Farage. 

Neither side has yet called for Nuttall’s head. He insists he is “not going anywhere”. With his febrile party no stranger to abortive coup and counter-coup, he is unlikely to be the one who has the final say.