The Conservative Party's annual conference comes into view today, as the party changes tack on sustainability with a promise to scrap emissions-cut requirements. There is also a new headache for the government on productivity forecasts, as well as doubts around the ‘omnibus’ deregulation packages being considered by the European Parliament.
Climate climbdown
The leader of the Conservatives, Kemi Badenoch, has pledged to repeal the UK’s 2008 Climate Change Act should her party return to government.
The act was strengthened in 2019 under Conservative prime minister Theresa May, instituting a legally binding 2050 net zero target for the nation.
Politico reports, however, that Badenoch believes the requirements it has introduced have driven up the price the UK pays for electricity – which is among the highest in the world. Others have argued that the reason for this cost is the country’s reliance on gas, the price of which has risen since the start of Russia’s war with Ukraine.
“Climate change is real. But Labour’s laws tied us in red tape, loaded us with costs and did nothing to cut global emissions,” Badenoch said while making the announcement, which comes ahead of the Conservative Party conference, which starts on Sunday (5 October).
The Conservatives under Badenoch would instead implement a law prioritising “cheap and reliable” energy. Current energy secretary Ed Miliband said that policy would be a “betrayal of future generations”.
Productivity problem
The government may soon face a renewed challenge on the public finances, as the Office for Budget Responsibility (OBR) looks likely to cut its productivity growth estimate, according to the FT.
The size of the shortfall between UK public spending and tax could rise from £8bn to £30bn as a result of the downgrade, according to Labour Party officials speaking to the publication. The chancellor’s allies have blamed the policies of the previous government.
One source from the party told the FT that “this downgrade didn’t happen while the Tories were in power”, and “now we’ve got to pick up the pieces”.
A Conservative official, meanwhile, said:
“We stuck in a load of productivity-boosting measures, like our NHS productivity plan, to try to avoid the OBR downgrading its forecasts. It’s Rachel Reeves’ problem if she has messed up the process. If they want to blame us, then good luck.”
Deregulation dysfunction
The EU’s ‘omnibus’ deregulation bill has hit a barrier after opposition was voiced by several Members of the European Parliament (MEPs) to elements of the package.
Two packages proposed to simplify EU regulations have been subject to a series of discussions within the Parliament, and they could be delayed should discussions fail to yield a report on the Parliament’s position before an 8 October deadline.
Among the points of contention are plans to water down environmental and climate requirements, as well as civil liability under the Corporate Sustainability Due Diligence Directive (CSDDD). The plans have backing from right-wing members of the Parliament, with the more centrist European People’s Party (EPP) suggesting it would also support passing the changes.
Under the proposals, the CSDDD would remove requirements for businesses to implement climate transition plans. The Socialists and Democrats (S&D) grouping in the Parliament, whose support the EPP may require for another deregulation package, has been critical of the EPP’s approach to passing the omnibus packages, saying there has been “not a single decent conversation, only threats and theatre” during negotiations.
Other news in the headlines
· While US manufacturing PMIs inched up, they still showed an overall contraction this month as private sector employment also struggled
· Lord Patrick Vallance called on pension funds to dial up their investments in the UK’s science sector
· Tesco boss Ken Murphy hit out at the government over taxation, saying “enough is enough” following the “substantial additional operating costs” he claimed were caused by last year’s Autumn Budget
Yesterday in trade
· Prime minister Sir Keir Starmer reiterated the need for economic growth while criticising the approach of Reform UK
· Marco Forgione, director general of the Chartered Institute of Export & International Trade, welcomed the prime minister’s recent announcement on driving more investment into skills for young people
· The UK drew closer to deal on critical minerals with Greenland
You can read those stories and more here.
