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Parliamentary Monitor

Each week we update this page with all the important sustainable finance news from Parliament, including oral and written questions and upcoming parliamentary activity. To get this update directly to your inbox, subscribe to our weekly news monitor.

Parliamentary monitor, 29 April

Updates

  • In his statement at the US climate summit last week, the Prime Minister reiterated how working to net zero can also bring about growth and jobs. He reaffirmed his preference for green technology as a tool to address the climate crisis by concluding that ‘we must use this extraordinary moment and the incredible technology we’re working on to make this decade the moment of decisive change.’
  • Minister for Investment, Lord Grimstone, revealed that the UK government is in discussion with some of the world’s largest sovereign wealth and pension funds about investing in green energy projects in Britain, especially in areas such as technology and infrastructure. These funds may invest in these areas alongside the UK’s new National Infrastructure Bank. The Minister also revealed plans for a new Investment Council that would provide advice on how to attract funding to the UK. The council would include the Chairs of HSBC and Santander, as well as other industry representatives.
  • The Minister for Exports, Graham Stuart MP, has called on UK businesses to look at emerging markets for export opportunities for low-carbon technologies and services. Writing recently in BusinessGreen, the Minister said that that it is essential that we connect businesses to overseas partners and project to create more opportunities for workers.
  • Meanwhile, writing in the Independent, Shadow Business Secretary Ed Miliband called on countries to set ambitious 2030 targets, for the UK government to convene others at the G7 and G20 to roll out bold green stimulus plans, to demand companies to disclose their alignment with the Paris Agreement, and finally urgent investment in renewables coupled with clear plans for a just transition.

Oral questions

  • In Treasury Questions on Tuesday in the House of Commons, the APPG’s vice-chair, Gareth Davies MP (Conservative, Grantham and Stamford) asked whether the Chancellor agrees that more can be done to improve transparency and prevent the exposure of investments by financial services companies to modern slavery. The Economic Secretary to the Treasury and City Minister John Glen replied that he agrees. On modern slavery, the landmark provision in section 54 of the Modern Slavery Act 2015 includes institutional investors that fall within the scope of the requirement and meet the criteria requiring them to publish an annual statement.
  • Meanwhile, Zarah Sultana MP (Labour, Coventry South) asked what steps the Chancellor is taking to maintain jobs in the steel industry and create new green manufacturing jobs. The Exchequer Secretary to the Treasury Kemi Badenoch replied that the Government have supported the steel sector extensively, including providing over £500 million in recent years to help with the costs of energy. At the summer economic update, the Government announced an ambitious £3.05 billion package for housing decarbonisation designed to cut carbon, save people money and create jobs. Alongside that, our covid support package is still available to the sector to protect jobs and ensure that producers have the right support during this challenging time.

Backbench MPs

  • Philip Dunne, the Chair of the Environmental Audit Committee, has called on the Government to provide clarity on the policy delivery needed to help us get to net zero. Writing in The Times Red Box, he commends the Governments’ recent emissions target and labels it as the type of international leadership that is needed to drive private investment, but outlines how a lack of detail is hindering progress.
  • The Public Accounts Committee (PAC) has published its Environment Tax Measures report yesterday that concluded HMT and HMRC have a very limited view of the role of tax and a limited understanding of the environmental impact of taxes. The Committee recommends for HMT to now set out a clear vision by COP26 of how it will help the government achieve net zero, as well as new timetable by the next budget for how it will consult on options for replacing revenues from fossil fuels, such as fuel duty. Commenting on the report’s publication, the chair of the PAC Meg Hillier said “The economic revolution required to abandon fossil fuels and reach net zero must be the greatest co-ordinated ask, of governments around the globe, in history. But the UK government has been blithely issuing ever more ambitious climate targets for years now, with no sign of a roadmap to reach any of them.” The report has been published the same week as new polling by Britain Thinks and commissioned by Green Alliance that revealed that 60 per cent of the public support the principle of green taxation.

Upcoming Parliamentary Activity

Relevant Parliamentary Written Questions

1. Question by Andrea Jenkyns (Conservative: Morley and Outwood):

To ask the Secretary of State for Business, Energy and Industrial Strategy, what plans his Department has to develop green hydrogen production across the UK.

Answered by Anne-Marie Trevelyan (Minister of State for Business, Energy and Clean Growth):

Low carbon hydrogen will be vital for meeting our legally binding commitment to achieving net zero by 2050, with potential to help decarbonise vital UK industry sectors and provide flexible deployment across heat, power and transport.

Working with industry, the UK is aiming for 5GW of low carbon hydrogen production capacity by 2030. As we progress towards this ambition, we would hope to see around 1GW of hydrogen production capacity by 2025.

The UK has expertise and assets to support both electrolytic (green) and Carbon Capture Utilisation and Storage (CCUS) enabled (blue) hydrogen. Our twin track approach to enable both routes will drive cost effective supply volumes in the 2020s in line with our 2030 ambition, whilst scaling up green hydrogen. This approach is already in evidence in the Government’s £121m hydrogen innovation funding programme, the development of business models to stimulate private investment and the design of the £240m Net-Zero Hydrogen Fund, confirmed out to 2025.

We will publish the first ever UK Hydrogen Strategy in the first half of this year which will set out the key steps needed in the 2020s to deliver our 5GW ambition and set the context for further scale up on the way to net zero.

2. Question by Dr Alan Whitehead (Labour: Southampton, Test):

To ask the Chancellor of the Exchequer, what assessment his Department has made of the level of support required to develop the UK’s green hydrogen economy.

Answered by Kemi Badenoch (Exchequer Secretary to the Treasury):

As outlined in BEIS’ Energy White Paper, the Government intends to take a ‘twin-track’ approach to developing a hydrogen economy, focusing efforts on both “blue” and “green” hydrogen. This is expected to grow the UK’s hydrogen supply chain, build sector confidence, and enable scaling up to ensure the longevity of a hydrogen economy.

Furthermore, the Prime Minister’s Ten Point Plan highlighted the significance of hydrogen as a priority technology and the Government recognises the key role it could play in the transition to a net zero economy by 2050. Therefore, the Government has committed to work with industry to aim for 5GW of hydrogen capacity by 2030.

At the 2020 Spending Review, the Chancellor provided £240m for a Net Zero Hydrogen Fund to further the development of a hydrogen economy. The Government is also in the process of developing business models to support the creation of a hydrogen market. Further details of these support mechanisms will be provided in the summer alongside a Hydrogen Strategy.

3. Question by Kerry McCarthy (Labour: Bristol East):

To ask the Secretary of State for Environment, Food and Rural Affairs, if the Government will sign up to the UN Environment Programme’s Sustainable Blue Economy Finance Principles.

Answered by Rebecca Pow (Parliamentary Under-Secretary of State for Rural Affairs and Biosecurity):

The Government recognises the serious and increasing threats currently facing the ocean, and the disproportionate impact this has on the world’s poorest. That is why our manifesto committed to a £500 million Blue Planet Fund to help eligible countries reduce poverty and sustainably manage the ocean.

Beyond public investment, the Government recognises the importance of mobilising private finance to help tackle this issue. Though we have no immediate plans to sign up, we welcome the UN Environment Programme’s work to progress this agenda, including through the Sustainable Blue Economy Finance Principles.

4. Question by Caroline Lucas (Green Party: Brighton Pavilion):

To ask the Chancellor of the Exchequer, pursuant to the Answer of 8 March 2021 to Questions 159269 to 159273 on climate change and biodiversity; what steps his Department has taken, through the UK’s presidency of the G7, to call on international partners to examine the findings of the Dasgupta Review including those on measures of economic success; whether global action on the recommendations of the Dasgupta Review is on the agenda for (a) the G7 summit in June 2021 and (b) other forthcoming G7 meetings; and if he will make a statement.

Answered by Kemi Badenoch (Exchequer Secretary to the Treasury):

The Government welcomes the publication of the Dasgupta Review as a strong example of UK thought leadership on an important environmental issue with clear – but often overlooked – economic consequences. The Government is closely examining the Review’s findings – including those concerning measures of economic success. The Government will call on international partners, including through the UK’s Presidencies of the G7 and COP26, to do the same and will respond formally to the Review in due course.

Following the launch of the Dasgupta Review, the Chancellor co-hosted the first G7 meeting with the Governor of the Bank of England on 12 February and stated that climate and nature considerations will be a central priority for this year’s Finance Agenda, paving the way to a truly green global economic recovery. The Chancellor urged his counterparts to match the UK’s ambitions ahead of COP26 and COP15 and stressed the importance of working together to support a smooth and effective transition of our economies to net zero.

The Chancellor also used his 6 April Finance Ministers and Central Bank Governors meeting to press once again for further ambition on climate and environment policies, and the Government will continue to do so at the G7 summit in June and beyond.

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