4. Mr McGrath asked the Minister of Finance what plans his Department has to provide multi-year funding for climate mitigation and the transition to net zero. (AQO 2742/17-22)

The Executive will shortly be preparing a draft Budget for the next three years, following the outcome of the spending review. To inform the development of the draft Budget, each Department has been invited to make bids against a limited number of Executive priorities, including green growth and sustainability, which will also cover climate mitigation. It will then be for the Executive to determine what funding will be made available as part of the Budget to help to tackle climate change and to support the transition to net zero.

Minister, as we saw at COP26, commitment to carbon reduction needs action plans, and action plans require financing, whether that is for retrofitting homes, overhauling public transport or a just transition for workers who are affected. Will you guarantee that the multi-year Budget that you will set in the coming months will have specific funding streams for the transition to net zero, so that the public can judge the level of Executive commitment?

Again, it is for the Executive to guarantee that, not me. At our planning session pre the spending review outcome, which I remind the Member was disappointing, I invited the Executive to set priorities. One of the priorities that I invited them to set, by making submissions to allow me to draft a Budget with bids against some of those priorities, was around green growth and sustainability.

So we have had interest from a range of Departments that have responsibility in that regard. The Executive will have to set that priority against competing priorities in health, inequalities, economic growth, sustainability, skills and all the other areas that, when it comes to a Budget debate here, Members will, I am sure, say that we should have prioritised. Of course, commitments have been made for the transition to net zero. The Executive will have to try to match those commitments in their spending.

The Minister has demonstrated his intent to utilise public spending for public good by incorporating social value requirements into the procurement process. Will the social value element also include a focus on climate change?

One of the elements of the social value that people will have to demonstrate, which will be 10% of the contract value from next June and move up to 20% in June 2023, can and should be environmental. There is an opportunity for people to make that contribution. It is not just about simply the measures that the Executive take through public funding but about how they utilise their procurement power to ensure that other sectors make environmental contributions as well.

There are financial pressures on Health, as was indicated earlier, Education and many Departments. We also have two climate change Bills before us, the outcome of which will be additional pressures in terms of supporting change or mitigations for those who have been adversely affected. Does the Minister accept that there is a need to record the cost of what we are doing and to ensure that a budget is set aside to enable our movement towards UK net zero carbon?

It is incumbent on us to try to ascertain the costs as best we can and make sure that, if that is a priority for the Executive — I am recommending that it should be — we have resources to meet our targets. The Executive have set themselves targets. We are not doing that alone; we are, obviously, part of a global attempt, as limited and fractious as it may be coming from COP26, to transition to net zero for future generations. We have to try to match the resources that are required to do that and understand the costs that are associated with doing it, but we set that against a range of priorities, some of which the Member outlined: health, education, protecting vulnerable people and economic recovery. We have to try to stretch what is a limited resource, even though it allows us to plan over three years, across that range of challenges.

As the Member referenced, two climate change Bills are going through the Assembly. I hope that there is some attempt to have a meeting of minds so that we get something that everyone can buy into and does what needs to be done in the time ahead in terms of climate change.

Minister, what considerations have been given to seeking the ability to levy a carbon tax on all fossil fuel company emissions?

Something at that level is done by Treasury, so, ultimately, it is a question for it. We have a more limited role here. The Fiscal Commission is looking at various tax-raising and tax-levying powers. I have not been prescriptive with it about what it might look at. I am eagerly awaiting a draft report to make sure that we can have that debate. Of course, a final report will be a matter for an incoming Executive to consider legislating for. The ability to put a carbon tax on large fossil fuel companies would more than likely originate from Treasury.