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The Government will increase annual public investment to tackle climate change, biodiversity loss and environmental degradation by the equivalent of around 1% of GDP, or £26bn a year at current prices, extending decades of underinvestment. We should supplement this and revitalize the country. Efforts are being made to meet environmental goals, a new study claims.
The report published today shows that the continued low levels of public investment set out in the latest Autumn Statement and continued barriers to business investment in productivity and green assets are undermining the UK’s competitiveness and threatening further economic slowdown. It warns that this is likely to lead to
The report, written by experts from the London School of Economics and Political Science and the University of Cambridge, Boosting UK growth and productivity through investing in a sustainable economy – Argues that increased public investment and a “coherent set of public policies” can drive innovation and encourage private investment in tackling climate change, biodiversity loss and environmental degradation.
The government could therefore ultimately unlock public and private investment worth at least 3% of GDP, or £77bn a year.
Calls for increased public spending on green infrastructure, including Labour’s proposed £28bn a year Green Prosperity Plan, come as the government says borrowing to invest in low carbon projects could lead to higher taxes and inflation. has led to criticism. However, the report’s authors found that increased investment in the transition to a sustainable, inclusive and resilient economy could boost productivity and growth, and ultimately improve the UK’s public finances. It is claimed that there is.
The report added: “The direct public funding needed to support this transition should not be expected to worsen public debt and GDP trends.” “Indeed, by fostering long-term resilient growth, borrowing for investment is the only way to ensure the long-term sustainability of public debt.
“Achieving a transition to sustainable, inclusive and resilient growth will require up-front investment costs, but targeted, temporary borrowing for adequate net public investment will be and reduce its debt-to-GDP ratio and become fiscally responsible.”
The analysis shows that once improved sustainable innovation systems are put into operation, new, more efficient and productive industries will increasingly out-compete old polluting industries and begin to generate their own global revenues and inward investment. , adding that government support could be gradually reduced.
In contrast, it said, inaction is likely to undermine economic competitiveness and fiscal resilience, potentially requiring costly remedial support later on.
“Too much current investment in the economy is unsustainable, including developing new oil and gas fields in the North Sea and building homes and offices that are not energy efficient or climate resilient,” the report said. .
“This risks creating stranded assets, significant economic losses in pollution- and emissions-intensive sectors, and an unstable, unaffordable and unsustainable energy supply. It will mean we will not be able to adequately address environmental degradation, including biodiversity loss, water, and air pollution.
“In contrast, a sustainable, inclusive and resilient economy offers significant benefits in increasing productivity through innovation and efficiency, by planning more livable cities, and by improving access to nature. It will reduce hazardous waste and pollution and support human health.”
business green has reached out to the government for comment, but has not received a response at the time of writing.
The report comes amid continued speculation about Labour’s £28bn green investment plan after The Sun reported late last week, citing Labor sources, that the opposition was preparing to lower its target. Ta. The report comes days after Labor leader Keir Starmer and a number of senior shadow cabinet ministers defended the £28bn a year target but stressed that any borrowing would be subject to the party’s fiscal rules. .
A Labor Party spokesperson quickly dismissed the story as “complete nonsense”. “We are committed to Labour’s Green Prosperity Plan to boost growth and create jobs, including plans to increase annual investment by up to £28 billion in the second half of the Parliament, subject to fiscal rules.” they stated.
Want to know what’s happening on the cutting edge of sustainability? Check out business green intelligence – Premier information for professionals focused on the UK’s green economy.
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