Jobs and Growth in a Low-carbon Economy

Part of Opposition Day — [Un-Allotted Day] – in the House of Commons at 4:35 pm on 5 March 2012.

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Photo of Caroline Flint Caroline Flint Shadow Secretary of State for Energy and Climate Change 4:35, 5 March 2012

I will make a little more progress.

In government, we recognised that at a time when public money is in short supply, a green investment bank could leverage in private investment. That is extremely important to our ambitions for the next level of energy generation that we want our country to achieve. In his autumn statement, the Chancellor boasted that he had funded the first ever green investment bank. Now, however, the Government are set to borrow a staggering £158 billion more than they planned a year ago, and the green investment bank will not have full borrowing powers until 2016 at the earliest. The Government’s claim that the green investment bank is part of a strategy for growth looks somewhat thin—like the rest of the strategy—if it is able to deliver any real investment only at the tail end of this decade.

The green deal is yet another example of a policy that we set in train in government but now appears to be headed for a car crash. Originally, the Government claimed that the scheme would create up to 100,000 insulation jobs by 2015, reaching 14 million homes by 2020 and 26 million homes by 2030. Now, sadly, the jobs forecast has been downgraded by nearly half. Transform UK believes that the green deal will reach only a fifth of the number of households that the Government expect, while the number of those in fuel poverty could reach 9 million by 2016. We still have no detail on the interest rates that will be charged, which is significant for whether anybody will be willing to take up the green deal.

As well has having a coherent strategy to improve the energy efficiency of our existing housing stock, we need new homes to be built to the highest standards. The Government could have ensured that a new gold standard was created with the code for sustainable homes, which I launched as Housing Minister, but they have fudged and watered down the commitment on zero-carbon homes. We should add to that reports that the Government, in the form of the Secretary of State for Education, are planning to undermine the green building code for schools. That worries me because, yet again, the Government’s role in stimulating new building methods and making new markets appears to be overcome by short-termism and lack of vision.

We need an active industrial strategy to bring about the energy industrial revolution. First, to unlock the £200 billion of private investment, we need clear signals and clear intent from the Government, unsullied by the voice of the Chancellor of the Exchequer playing to the gallery at the Tory party conference. Secondly, we need better procurement to ensure that public money is spent in a way that supports the low-carbon economy. Housing benefit is one example of that. In our manifesto, we said that we would consider regulating parts of the private rented sector because of the way it acted, which we felt was inappropriate to its tenants and not a shining example of the best that we could expect in that part of the housing market. Unfortunately, however, the Government have set their face against any regulation of the private rented sector, even though housing benefit is paid towards 40% of private rented tenancies and homes in the private rented sector are the least energy-efficient. I have suggested that we use housing benefit to drive up energy efficiency standards in the private rented sector. That would also create a supply chain for installers delivering the products and small businesses manufacturing them, and it could save tenants as much as £488 a year on their energy bills.

The third part of an active industrial strategy is skills. New industries cannot survive with an ageing work force. I am sure that Ministers are as aware as I am of some of the problems in different parts of the energy sector, including nuclear, in this regard. We hope that the modernisation of our energy infrastructure will happen in the next decade. The people who will do that are already in our education system, and we have to make sure that they are prepared for the future in terms of our energy security.