MPs look to green sector for post-Covid recovery
The Environment Audit Committee has published its recommendations on how to ‘grow back better’ after Covid-19 today (17 February), with the aim of creating a greener and more resilient economy.
Among the recommendations are VAT reductions for areas of the green sector that encourage energy efficiency, the use of recycled materials and repair services, as well as investment in the Government’s carbon targets and concentrated job creation in the waste minimisation industry.
The EAC has also called on the Government to front-load its investment in the circular economy and to focus on creating green jobs.
EAC Chairman Philip Dunne said: “The Covid-19 crisis must be treated as a wake-up call. It is a symptom of a growing ecological emergency.
“The economic recovery will shape our national economy for decades to come, and it is crucial that tackling climate change and restoring nature is at its core.”
Tax incentives towards a circular economy
One key point of the report is tax changes, which the EAC believes could offer a ‘reset’ to design an economy that can deliver net-zero Britain, which the UK Government has committed to delivering by 2050.
The EAC has recommended that VAT reductions should be introduced to repairs services and items that have been reused or recycled, in order to encourage the move towards a circular economy.
It also recommends VAT reductions on energy efficiency upgrades in homes, alongside tax incentives on low-emission vehicles, to make green options more attractive to consumers.
“A tax system fit for net-zero Britain is key. It will encourage innovation, give confidence to the sector and support companies to make the low carbon transition,” Dunne added.
Investments in low-carbon technology
In considering the future of investment in infrastructure, the EAC has urged the government to set out a clear strategy for carbon, capture, usage and storage (CCUS).
CCUS is considered to be an important technology in the UK’s road to reducing carbon emissions.
In December, the Prime Minister announced the UK’s target of reducing emissions by at least 68 per cent compared to the level in 1990 by 2030, which the EAC has advised requires urgent attention.
“There will be no vaccine against runaway climate change, and it is our responsibility now, using the opportunity of the economic recovery, to set the UK on track for net-zero,” said Dunne.
The EAC has also called upon the Government to introduce carbon targets for the construction of new homes, to increase demand for low-carbon materials.
Creating jobs in waste management
The EAC has highlighted the waste management sector as an area that can be utilised to create more green jobs and help boost the economy through ‘circular business models’.
The report advises there is significant potential for job creation and value retention from approaches that minimise waste and provide incentives to reduce, repair, reuse and recycle, and calls for a reduction in materials that are wasted through landfill, exports or incineration.
In March, the Chancellor will announce the Budget for 2021, which the EAC has advised must be ‘used as a springboard to revive the economy and kickstart the green industrial revolution’.
“There are endless initiatives that can lead to a greener future and the Chancellor should use his upcoming Budget statement to start this process,” Dunne concluded.