UK Treasury ‘blocking green policies key to net zero target’

UK Prime Minister Boris Johnson.

The Treasury is blocking green policies essential to put the UK on track to net zero emissions, imperilling the UK’s own targets and the success of vital UN climate talks, experts have told the Guardian. A string of policies, from home insulation to new infrastructure spending, have been scrapped, watered down or delayed. Rows about short term costs have dominated over longer term warnings that putting off green spending now will lead to much higher costs in future. The UK’s credibility as host of the Cop26 climate talks this November in Glasgow rests on a clear net zero strategy – but publication has been postponed until near the eve of the summit, giving the UK little leverage to bring other countries to the negotiating table with the tougher carbon targets needed. Meanwhile, steep cuts to overseas aid have severely damaged the UK’s standing internationally, experts on the UN talks said. Jamie Peters, director of campaigning impact at Friends of the Earth, said: “The Treasury has been helping to fuel the climate emergency for far too long. The reality is that a rapid transition to a zero carbon future would be far less expensive than delaying the green measures we so urgently need, and that will create significant economic opportunities and new jobs.” Civil society groups, think-tanks and political insiders said the Treasury had refused to commit to the spending needed to shift the UK’s economy to a low-carbon footing. Complaints about the potential short-term costs of net zero policies have been one flashpoint during weeks of high tension between the prime minister, Boris Johnson, and the Chancellor, Rishi Sunak, the Guardian understands. Kate Blagojevic, head of climate at Greenpeace UK, said: “There are strong reports that Rishi Sunak is intent on blocking climate spending at exactly the moment we need it most, and that his fingerprints sit heavily on moves to delay or block crucial investment to cut emissions from buildings or gas boilers.” The lengthy charge sheet against the Treasury includes: scrapping the green homes grant insulation scheme; freezing fuel duty while slashing electric car incentives; mulling cuts to air passenger duty on domestic flights, while making above-inflation train fare increases; failing to cut VAT on green home refurbishment; underfunding the new infrastructure bank; and delaying the phasing out of gas boilers. There have also been glaring omissions and delays. For instance, the transport strategy failed to back road pricing, which many believe will be essential to reducing emissions, which have remained stubbornly high as more people buy SUVs. Both the hydrogen strategy and heat and buildings strategy have been delayed until autumn, as has the overarching net zero strategy. Not all of these policies were under direct Treasury control, but the Treasury holds the purse strings and can effectively veto plans by other departments that require government investment or might raise costs for consumers.“The Treasury is at the root of this,” said Ed Matthew, campaign director at E3G, a green thinktank. “They are completely obsessed with short-term costs. It’s bonkers.” Chris Venables, head of politics at the Green Alliance thinktank, said: “The Treasury has this huge institutional resistance to medium term economic benefits (that entail short term costs). They have to be dragged kicking and screaming to consider it.” Ministers and advisers are understood to be anxious that costs such as switching to heat pumps from gas boilers, estimated from £5,000-20,000 for some households, or the higher purchase price of electric cars, will hurt consumers’ pockets.