Blog: The energy transition needs leadership, not political posturing

UK Prime Minister Rishi Sunak’s decision to water down the government’s Net Zero targets goes to the heart of a serious failing of Britain’s infrastructure development: a political class that follows whichever way the wind is blowing

A phrase from the politics of the 1990s has been coming back to me quite frequently in recent weeks. It’s the one where Tony Blair, then Leader of the Opposition, stands at the Despatch Box and says of his opposite number, Prime Minister John Major, “I lead my party, he follows his.”

The quote was a devastating put-down of Major as he battled factions in his Conservative Party (sound familiar?), and certainly remained in voters’ minds when they went to the polls in 1997.

But that idea of a party leader, or indeed, prime minister, unable to stay the course and make difficult decisions for the good of the country because of internal opposition and a desire to try to find a few extra votes, is certainly something that came to mind when Rishi Sunak made his announcement this week revealing plans to push back targets on green energy. Emboldened by the recent Uxbridge by-election, where the Tories narrowly held on to power - believed in part to be down to voter opposition to the rollout of the ultra low emission zone charging regime by Labour’s London Mayor Sadiq Khan - Sunak seems to have concluded that people might be willing to vote for him if he takes his foot off the energy transition accelerator.

The 2050 targets are still in place - as Sunak has been at pains to point out. But many in business have reacted angrily to the changes he has introduced, pointing out that significant sums have been invested on the basis that, for example, no new combustion engine cars would be sold from 2030 onwards.

And while Sunak is hopeful the move will grab him some votes, the overall response harks back to that Blair quote, effectively asking, ‘Where is the leadership?’

As prime minister, Sunak has a responsibility to take tough decisions and make difficult choices (as any politician will tell you). And yet, he has chosen the easy way out: pushing out the deadline for some of the Net Zero policies, so that he doesn’t have to worry about finding the money for them today - or, perhaps more importantly for him, explaining to the public why those investments are necessary.

As well as pushing back the urgent work on tackling climate change (Sunak’s speech came in a week when it was reported that Antarctic sea ice is at alarmingly low levels), the announcement “sends all the wrong signals” and leaves industry “exasperated” over how it should be planning for the future, as some have said.

During a roundtable that I chaired in Edinburgh this week, hosted by law firm Burges Salmon, this issue of leadership was high on the agenda, with plenty of people around the table showing their frustration at the complete lack of political leadership on infrastructure issues, which has led to the country being unable to deliver a coherent programme of investment for many years. Some were even fantasising of a world in which politics and infrastructure are completely divorced, but the reality is that a democracy requires the people and their elected representatives to have an important say in what is built in their localities.

As those and others in the industry - and in the country at large - know, there is no time to delay on tackling emissions. Sending a message that green targets can be pushed back not only threatens Britain’s leadership in this area, it also risks devaluing the climate emergency and suggesting that investment in the energy transition can be turned on and off at the whim of government.

In fact, the chances are that Sunak will see some rather annoyed investors heading overseas, to find more stable homes for their cash. Again, this was a theme touched on by those at our roundtable debate, pointing out that there is a global competition for investment at the moment - and the UK is already falling behind to regions such as the Middle East and the US.

To be clear, this is not a politically motivated criticism: Labour’s response to Sunak’s decision has been insipid, to say the least - refusing to say that a Labour government would look to reinstate the previous policies and instead simply focusing on the impact of the government’s “delay and dither”.

Leadership - real, political leadership - is being willing to make decisions and follow them through, all the while explaining to the public why these are the right decisions. When you won the last election with a Commons majority of around 80 seats, you can also point to your manifesto and remind opponents that the public voted for this course of action.

Yes, the current economic conditions have made it harder: as our roundtable discussed, the cost of capital has increased in recent years, and the case for infrastructure investment is now harder to make as materials and labour costs continue to rise.

However, a government serious about developing the long-term future of the country must seek to find solutions, not simply kick the can down the road. That is in part what the PFI programme was about in the late 1990s and 2000s - as former Labour Health Secretary Alan Milburn recently told The Rest is Politics podcast, it was a pragmatic solution to the problems of the day, not an ideological pursuit in itself.

The UK Investment Bank stands ready to act, and surely must be used to greater effect to help kickstart investment. Investable propositions can be devised, and more encouragement into these areas should be made by government, while at the same time explaining to the public at large why these investments and changes are necessary.

Sunak and others wring their hands about not wanting the poorest in society to have to bear the costs of the energy transition - but perhaps the case should be made for how the more wealthy can and should bear those costs. After all, it will be the poorest who will bear the brunt of climate change and its impacts.

In the end, another quote comes to mind. As Brenda from Bristol infamously said in response to the announcement of yet another General Election in 2017: “There’s too much politics going on!” I might add to that, ‘and not enough political leadership’.