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UK Government is left examining the entrails

Andrew Hartley

…on global competition

Despite what I tell my team, I don’t often act like a god. But in this, my last column for MRW, I want to act like the Roman god Janus. He had the handy trick of having two heads: one facing backwards and the other forwards. This enabled him to see the past and the future at the same time. I want to look at the changes that have taken place since my first column, and I’ll cast an eye to the future of our global competitive position.

When I wrote my first column, we had a different Government. The credit crunch was biting, we were in recession and the private sector was in retreat. Since then, the worst of the recession is over and the UK economy is growing, if slowly. But the deficit has not gone away and the coalition Government is showing the bond market that it is serious about addressing this.

The Comprehensive Spending Review spelled out the plans. As well as spending cuts, there were initiatives aimed at stimulating growth. These included £1bn to be allocated to the Green Investment Bank, the continuation of FITs, ROCs and RHI, and some interesting tax breaks. There is also £1.4bn to be allocated to the Regional Growth Fund (RGF). I will certainly be trying to win a slice of this for low-carbon projects in the north.

Businesses and councils are united in their hope that these funds will deliver investment in recycling, renewable energy and other green initiatives, delivering much-needed jobs and growth. But some of the detail remains unclear.

“Germany has been quick to develop close links with China on the environment”

So much for the past which, as the novelist LP Hartley wrote, “is a foreign country: they do things differently there”. People named Hartley, in my experience, often say wise things. But there is another foreign country where they do things differently and that is China.

When China does something, it does it big. Look at its investment in renewable energy. In 2009, this stood at $34.6bn - twice that of the US and three times that of the UK. At the trough of the credit crunch, European investment in renewables fell by 13% and US investment by 30%. In China, however, investment increased by 29%.

Germany has been quick to develop close links with China. In July, chancellor Angela Merkel visited Beijing and signed a joint communiqué with Chinese prime minister Wen Jiabao to signal closer co-operation. Significantly, Merkel took her environment minister with her.

So this is the challenge. The UK needs the stimulus of green jobs, and, yes, we all believe in the potential of the environmental sector to deliver growth. But we are not the only country to have spotted the opportunity. Unless we get serious about encouraging UK companies to develop their capability in low-carbon technologies, we are in danger of being left behind.

So the RGF and the Green Bank need to support firms that have world-leading green solutions. And our innovation, science and skills base must be maintained. This is the essential catalyst if the private sector is really going to deliver a million new green jobs.

With the right help, our environmental sector could look like another Roman god: Mercury, the god of trade, profit and merchants.

Andrew Hartley is operations director at CO2Sense Yorkshire

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