UNLEASH PLAN FOR NET ZERO TRANSITION TO SECURE ECONOMIC FOUNDATIONS

This week, Chancellor Rachel Reeves will deliver her first Autumn Budget – and this government’s first fiscal statement. It will be a defining moment for the future of the UK’s economy. And we at the CBI have been clear: it is time for growth and now is not the time to take a step back from that goal. Last Wednesday, CBI CEO Rain Newton-Smith delivered that message at Business Green’s Net Zero Festival – urging the government to boost confidence and unleash a plan for the UK’s net zero transition. Delivering a low-carbon economy is essential for long-term, sustainable growth and at a time of global energy uncertainty, net zero is not just an ambition but a strategic necessity.?

To reach net zero, we need to transition sectors across our whole economy. Since 1990, we’ve cut the UK’s carbon emissions by more than 50%. That is huge progress indeed – but more than half of that has been just in our power sector. And that lack of movement in other areas of our economy is showing. A huge contributor to the soaring costs of the UK’s recent energy crisis was that we’ve done so little to tackle energy inefficiency in our homes and buildings. For every degree of heat a German home loses, a UK home loses three. Those are the sort of problems we have to solve next – and we can’t underestimate just how complex that is going to be.

Now, it’s crystal clear that the government can’t do this alone – and they need to share the load with businesses, including here in the South West. The market is going to need room to innovate and get this right – but at the same time, investors need detailed pathways for all sectors. They need to see frameworks that inspire confidence in how and when government support will be available, to create those revenue streams that are not yet viable. That’s in the government’s gift. We need government and business working together – the clear eye of the government, and the invisible hand of the market.

It's going to be a rocky road – because the challenge is daunting, and it is complex. The Climate Change Committee (CCC) estimates it will take 2.7 trillion pounds more investment between 2021 and 2035 to transition the whole of the global economy. And the longer we leave it to tackle the trickiest challenges, including here in the South West, the more expensive it’s going to be. The more we’ll be energy insecure, and at risk from global uncertainty and market shocks.

As we face this crucial stage in our energy transition, we can also keep ahead in the race for green growth. Like through clarity on transition planning, in consultation with business, a clear timeline for the Green Finance Strategy, and a Net Zero Investment Plan mapped across economic sectors. Because as much as this next stage presents challenges, it also brings huge economic opportunities. Those are ours to seize – and we cannot afford to step back now. This week’s Autumn Budget could be a critical juncture for the UK’s growth prospects. Let’s use this moment to lean into green growth: to both boost and secure our growth foundations.