The Labour Party’s Green Prosperity Plan (GPP) to massively boost investment in the green transition has attracted criticism for being unrealistic. While it is legitimate to subject Labour’s plans to scrutiny, we should not lose sight of the fact that economy and society wide decarbonisation requires serious and sustained investment, starting immediately.
The Climate Change Committee estimates that low carbon investment each year will have to increase from around £10 billion in 2020 to around £50 billion in 2030. Although much of this money will come from the private sector, the nature of the green transition provides an important catalysing role for government to crowd-in private spending through initial public investment.
Moreover, this investment will eventually be recouped through greater efficiencies and higher economic growth. Investment in green technologies will kickstart new industries and provide high skilled jobs, many of these in areas that have suffered from low productivity and poor economic prospects.
This briefing sets out:
- The overall economic case for a substantial programme of green investment
- The criticisms of higher investment spending such as the risk that it will fuel inflation
- Policy recommendations for how the programme should be managed
Steve Coulter, head of economy, firstname.lastname@example.org