Government Urged To Drive Green Economy

The Chancellor‎ George Osborne is facing calls from business leaders to set out a comprehensive green growth strategy in next month’s Budget.

The Aldersgate Group is an influential green pressure group made up of businesses, as well as politicians and charities such as Friends of the Earth and the WWF. Big name IT players include the likes of Microsoft and BT.

The group issued an open letter (PDF) to the Chancellor, in which they warned that the UK is losing momentum to emerging economies in green sectors.

UK Losing Out?

According to The Aldersgate Group, the Chancellor must set out a comprehensive green growth strategy in next month’s Budget, which would “help reduce the budget deficit and drive a dynamic economic recovery by increasing output and creating jobs.”

The Group said that it will publish a new report next week that shows that “other governments around the world are implementing plans to attract global investment in environmental technologies and the UK is losing momentum in this green economy race.”

The report cited examples of other nations’ green growth strategies, such as that of China’s new Five Year Plan that aims to underpin a ‘clean revolution’ in its economic development. It also cited India’s ‘National Action Plan on Climate Change’ that is projected to stimulate $1 trillion (£616 billion) of investment over the next decade.

The UK government urgently needs to implement a green growth strategy, the report said. It argues that the entire economy must be made more sustainable with greater prioritisation given to energy efficiency and technological innovations for improving the processes of established industries.

It cited a recently published study by the United Nations which analyses how a global investment of 2 percent of GDP in the green economy “could unleash economic growth and positive social outcomes, while keeping humanity’s planetary footprint within sustainable boundaries.”

Green Friendly Budget

“The Chancellor has promised a ‘budget for growth’ but we believe this must be a ‘budget for green growth’. The UK needs an explicit strategy to take advantage of the global shift to a green economy; driving jobs and exports. Cuts alone will not deliver a competitive economy,” said Peter Young, Chairman of the Aldersgate Group.

“The comprehensive green economy report by the United Nations debunks any myth that we must choose between greening or growing. We can and must do both. The most successful and progressive businesses are already showing the way and no one can afford to be left behind,” he added.

This sentiment was echoed by Tory MP and green campaigner, Tim Yeo MP, who is also Chair of the Energy and Climate Change Select Committee and an Aldersgate Group member

“Britain’s best chance of resuming satisfactory economic growth is to seize the opportunities for leadership in green technology. Those countries which move swiftly to low-carbon energy, low-carbon transport and a low-carbon built environment will enjoy a huge first-mover advantage during the next two decades,” said Yeo.

Track Record

The Coalition government and the Chancellor George Osborne have so far been relatively enthusiastic on green issues, as officials seek to tackle the huge public deficit left by the previous Labour administration.

While the government’s emergency budget last June officially placed the UK into austerity mode, it also outlined the axing of expensive IT projects inherited from the previous government.

And then in October George Osborne announced £1 billion in funding for a Green Investment Bank, as part of efforts to make the UK a leader in the low-carbon economy.

But this good work has been tempered with the government’s decision to turn its Carbon Reduction Commitment (CRC) into something of a green stealth tax, after the decision to use the funds it generated to reduce the deficit, instead of  recycling the money.

Compass Management Consulting has previously warned that environmentally-friendly IT projects may be axed as cost-cutting measures are implemented in the current financial climate. But according to Fujitsu’s ‘Green IT: Global Benchmark’ report, the UK is leading the way in the adoption of green IT practices, and Great Britain Plc boasts a green IT index higher than the US, Australia and India.

It found that the UK has the most rigorous carbon reduction and carbon reporting strategy of any of the countries surveyed, and awareness of green IT is higher than in the other countries. Overall, Britain scored a green IT index of 61.0 (out of 100).