Pragmatic politics to help taxpayers or cynical pandering to the right wing of an electorally-struggling political party and the mainstream media? British Prime Minister Rishi Sunak’s announcement of a backing off from Net Zero commitments by the UK Government has divided opinion.
Sunak confirmed on Wednesday that he plans to delay a 2030 ban on new petrol and diesel vehicles as well as slackening a schedule to phase out gas boilers by 2035. He also threw in some strange commitments to scrap a number of other policies, such as taxing meat and not forcing people to have seven different bins in their homes, policies that no-one can actually remember having been previously announced. (They were actually brainstorming ideas floated by the government advisors on the Committee on Climate Change at various points, not policies!)
The Prime Minister, who’s looking down the barrel of a General Election in the coming months with the Conservative Party a long way behind the Labour Party in the current polls, denies that he’s playing party politics with Net Zero commitments laid down by previous governments:
We are absolutely not slowing down efforts to combat climate change. I am very proud of our country’s leadership. We have decarbonized faster than any other major economy in the G7, not a fact you hear reported that often…We are absolutely confident in our position. We have been through all the numbers, we have looked at the range of policies that we have got in place.
But if the changes were supposed to be red meat for the Tory heartland - and the approval of the right-leaning tabloids, all claiming credit for forcing the shift, indicates some success here - Sunak’s decision has further divided an already split Conservative Party. Chris Skidmore, a Conservative former energy minister, said:
The decision will cost the UK jobs, inward investment, and future economic growth that could have been ours by committing to the industries of the future. It will potentially destabilize thousands of jobs and see investment go elsewhere.
Why this matters to tech
The immediate negative reaction from business centered on the automotive and energy sectors.
Chris Norbury, CEO of energy provider E.ON energy, said the move would delay “the vital work of transforming our economy”, while Ford UK chairwoman Lisa Brankin said:
Our business needs three things from the UK government: ambition, commitment and consistency. A relaxation of 2030 would undermine all three.
What’s all this got to do with enterprise tech? On the immediate face of it, not a lot in practical terms. There’s nothing tech-specific in what Sunak trotted out. Companies like Amazon and Google and Salesforce et al have clear Net Zero policies and practices in place that aren’t touched by this announcement directly.
But what Sunak has done in one fell swoop is to show willingness to move the policy goalposts when it suits him. That smacks of instability and opportunistic behavior, neither of which are helpful when you’re running a country that’s broken off from one of the world’s biggest economic/trading blocs and need all the inward investment you can get!
As former Siemens UK CEO Juergen Maier noted bluntly:
It’s just chaos, isn’t it? It beggars belief...I'm honestly angry. Everybody [industry] is now sitting and wobbling and wondering. And I tell you what, they won't be investing in the UK.
Julian David, CEO of UK tech industry association techUK CEO, said:
To make the long term investments necessary to achieve Net Zero businesses need a clear and stable policy environment. Weakening targets sends the wrong signals, deters investment and turns heads towards countries with more stable regulatory environments. It places the UK's prospects as a clean tech leader at serious risk. The Government's own commissioned review said the net zero transition is the economic opportunity of the 21st century, and the economic benefits will be mostly felt by countries who move early and encourage the most R&D and innovation.
In a wider statement, the association expanded on David’s point:
The Net Zero transition is going to be the economic opportunity of the 21st century which is why techUK is concerned the government seems to be pushing back some of the medium-term targets on electric vehicles, behaviour change and buildings.
This sends the worst possible signal to investors, the business community and the tech sector who have already suffered years of regulatory uncertainty and confused signals. While businesses themselves have set ambitious targets, we need the right signals supported by regulatory and policy certainty to make the investment case and commit to developing long term R&D. Some industries only have one or two investment cycles before 2050, and many will simply defer the (much needed) R&D efforts or divert their investment away from the UK.
It went on:
Tech has a unique role as an enabler of economy wide decarbonisation and we know the sector is a heavy user of energy. At techUK we’re advocating for ‘tech-led decarbonization’ to reach the estimated 20% emissions reduction that can be enabled by tech, but to achieve this we need to scale the export-ready clean-tech solutions or risk losing the early mover advantage to the US and Europe. techUK therefore urges the government to think twice, especially as we approach the Autumn Statement and global COP 28 climate talks.
Opportunistic. Cynical. Chaotically announced. This isn’t “pushing back” on some arbitrary deadlines on behalf of the hard done by British taxpayer. It’s a naked electoral play - good luck with that! - that sends an incredibly damaging signal to multi-nationals thinking about where to put their investments. Sunak said:
There’s nothing ambitious about simply asserting a goal for a short-term headline without being honest with the public about the tough choices and sacrifices involved and without any meaningful democratic debate about how we get there.
This from a Prime Minister who rose to office without being voted in by either his party - he stood unopposed - or by the wider electorate, and who made an announcement about a major shift in national policy to the media, not to Parliament where it could have been debated.
Mind you, this is also someone who, with a straight face, stated from behind a podium embossed with a new slogan of “Long-term decisions for a brighter future” that:
I think people are tired of the false choice between two versions of change that never go beyond a slogan.
Quite how yesterday’s announcement is intended to change that is unclear, as the struggling performance of obfuscating government ministers sent out to explain away the news yesterday and today makes all too clear. As noted above, the main business reaction so far has come from the car and energy sectors. I’d like to think that the tech sector will be putting on pressure behind the scenes as well - and maybe even making concerns known publicly as well!
Final word to Al Gore:
I find it shocking and really disappointing …I think he’s done the wrong thing.