Chancellor Rishi Sunak to announce £3 billion green recovery package

6 July 2020, 22:32

Rishi Sunak is set to make the announcement tomorrow
Rishi Sunak is set to make the announcement tomorrow. Picture: PA

By Maddie Goodfellow

Chancellor Rishi Sunak is expected to unveil a £3 billion green package to create jobs, upgrade buildings and protect the environment as part of efforts to rebuild the economy after Covid-19.

The funding, which will be announced tomorrow, is expected to include a £1 billion programme to transform schools, hospitals and other public buildings so they are greener and more energy efficient.

The £1 billion for public buildings will pay for measures such as insulation, efficiency and green heating technology to cut emissions and save energy in places such as schools, hospitals, military bases and prisons.

Funding of £50 million will go to pilot innovative schemes to retrofit social housing at scale, with measures including insulation, double glazing and heat pumps.

The Treasury said retrofits of social housing could save an average of £200 for some of the poorest households while cutting carbon emissions.

The scheme is supposed to kick start the economy
The scheme is supposed to kick start the economy. Picture: PA

The £3 billion in green schemes aims to help the UK "build back greener" and meet its legally binding target to cut greenhouse gas emissions to net zero by 2050.

Campaigners have been urging ministers to deliver on the manifesto pledge to invest £9.2 billion in energy efficiency, to boost jobs across the UK, cut consumer bills and reduce carbon emissions as part of the pandemic recovery.

They said the funding being unveiled on Wednesday in the summer economic update was welcome as a "down payment", but does not measure up to what is needed to tackle the climate and economic crises.

The Conservative manifesto pledged £9.2 billion for energy efficiency, including £2.9 billion for public buildings and £6.3 billion for low income homes and social housing.

Ed Matthew, associate director at climate think tank E3G, said: "If this funding is the down payment on their manifesto commitment then it is a welcome start.

"If this is the total level of energy efficiency investment they are pledging then it is peanuts - barely enough to get us to the end of this year if we are to get on track to net zero."

Greenpeace UK's Rosie Rogers pointed to funding by other countries for a green recovery, including £36 billion by the German government and £13.5 billion by France and said the UK's £3 billion "isn't playing in the same league".

"Of course this money is better than nothing, but it doesn't measure up to the economic and environmental crises. It's not enough to create the hundreds of thousands of new green jobs that are needed.

"It's not enough to insulate all of the homes and buildings that need to be kept warm and more energy efficient.

"It's not enough to 'build back greener', and it's certainly not enough to put us on track to tackle the catastrophic impacts of the climate emergency," she said.

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The statement from the Chancellor will also confirm the announcement made last week by Prime Minister Boris Johnson that £40 million will be made available for nature conservation schemes.

Schemes to plant trees, clean up rivers and create new green spaces for people and wildlife could support up to 5,000 new jobs, the Government said.

Shadow business secretary Ed Miliband said the plan was not comprehensive and claimed it leaves out one third of people.

"We have consistently called for a recovery which has energy efficiency at its heart, and will welcome any measures which achieve that," he said.

"However, this is not a comprehensive plan. It appears there is almost nothing for the people who rent the 8.5 million homes in the social rented sector and private rented sector, which has the worst energy efficiency standards. That means one third of people are left out.

"It also needs to be part of a much broader and bigger scale strategy for getting back on track for net zero which includes a zero carbon army of young people getting back to work, investment in nature conservation, driving forward renewable energy, helping our manufacturers be part of the green transition and a plan for our transport network.

"The French government has promised 15 billion euros for a green recovery, the German government 40 billion euros. The UK government £3 billion so far. When the moment demands the Government creates the most ambitious green recovery possible, the Government has not so far risen to the challenge."

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The government is also set to announce that £100 million will be invested in unpaid traineeships for young people in England.

Businesses taking on unpaid trainees will receive a £1000 bonus for every trainee.

Mr Sunak is set to announce the measures for 18 to 24 year olds on Wednesday, when he will unveil his economic recovery strategy to deal with the effects of the Covid-19 pandemic on the economy.

It has also been reported that the chancellor has drawn up plans to exempt most homebuyers from paying stamp duty in a bid to boost the UK economy post-lockdown.

The Times reported that the Chancellor would outline plans this week to raise the threshold at which people start paying stamp duty from £125,000 to as high as £500,000.

The increase in the threshold is expected to be implemented in the autumn budget and is designed as a temporary measure to stimulate the housing market.

Housing stocks helped drive the London markets into positive territory as traders optimistically welcomed speculation over a stamp duty holiday.