GRJ0027

Greenpeace UK response to Environmental Audit Committee inquiry on Green Jobs

Greenpeace is a movement of people working towards a vision of a greener, healthier and a more peaceful planet, which can sustain life for generations to come. Working across Europe, the Americas, Africa, Asia and the Pacific, we investigate, document and expose the causes of environmental destruction, and we promote solutions, informed by science and research, for a green and peaceful future. Greenpeace UK has been campaigning for a green and fair UK recovery from coronavirus since April 2020.

1. What estimates are there for the jobs required to meet the pathway to net zero emissions, by sector, and other environmental and biodiversity commitments?

●        Greenpeace commissioned sustainability advisors 3Keel to analyse the employment benefits of implementing the policies outlined in Greenpeace’s manifesto, A Green Recovery: How We Get There.[1] The manifesto focuses on four policy areas: Clean Transport, Green Buildings, Smart Power, and Nature and a Circular Economy. It shows how rapidly deployed spending in these areas will help solve a key part of the economic crisis, create jobs and bring about far-reaching improvements to UK society. Our review suggests that the average number of jobs created per £1m invested is 19.6 jobs. Investments in a circular economy and green buildings generate relatively higher average numbers of jobs, at 24.1 and 23.2 jobs respectively. Investments in smart transport and smart power generate relatively lower average numbers of jobs, at 18.5 and 12.7 jobs respectively. Current annual spending on climate and nature is around £17bn. To stand a chance of meeting our climate targets, this needs to be increased by an additional £25bn annually, which would be comparable to the size of the German stimulus package, which included €40bn for climate and green measures. Investment in the green sector generates a higher number of jobs for the money you spend than the same expenditure in the high carbon sector. Over the course of this parliament the investments outlined in this briefing will create around 1.8m jobs, with much of this channeled towards ‘shovel-ready’ projects that would provide an immediate solution to the current recession. The full report, including methodology, can be found here.

2. Does the UK workforce have the skills and capacity needed to deliver the green jobs required to meet our net zero target and other environmental ambitions (including in the 25-year environment plan)?

●        There are skills gaps in key industries that will need to be addressed in order to meet our legally-binding climate targets. As one example, the Climate Change Committee has identified home insulation as a particular area where emissions reductions are being held back by inconsistent government support, which has led to a skills gap in housing design, construction and in the installation of new technologies. In this case, a large-scale programme of retraining and reskilling is required, delivered by empowered and properly funded local authorities, in collaboration with local businesses and skilled experts. Additional private investment in skills can be encouraged by clarity about the framework that the government will adopt to ensure that its EPC C efficiency target will be delivered for homes beyond social housing and those of low-income households. This will require a major intervention in the UK’s buildings market, which to date has failed to drive the necessary private investment to deliver essential improvements in energy efficiency. To make the policy framework for the able-to-pay housing sector effective, a new approach to delivery is needed – for example, through the establishment of a Warm Homes Agency, staffed by people with specialist skills and experience on the ground in the housing sector. The Agency (or equivalent) could learn from previous experiences where there was a struggle to deliver value for money or to encourage homeowners to retrofit at scale. It could work with local authorities, private developers, builders, landlords and householders to map out necessary retrofitting solutions appropriate to the local area; manage or support local skills development programmes; and oversee and guarantee the quality of delivery against government standards through regular inspections and enforcement. This approach could also support greater innovation, and the Agency could play an active role in sharing learning between areas.

●        See also answer to question 8 below for an example on the lack of Government support for workers in the offshore oil and gas industry to transfer their skills across to the offshore wind industry

3. What needs to be done to ensure that these skills and capacity are developed in time to meet our environmental targets?

●        Government should take a proactive approach to closing the gap in skills required to deliver green jobs and our net zero target, both through significantly increased investment, and through implementation of policy changes like those identified in Greenpeace’s manifesto which will attract private investment and send clear signals to investment markets.[2]

4. What measures should the Government take to ensure that its proposals to meet environmental targets do not by default lead to jobs in affected industries being exported?

●        The offshore wind industry represents a case study where lack of investment in infrastructure and supply chain has meant opportunities to increase UK-based jobs being squandered. Recent examples include Bifab fabrication yards in Fife and Lewis being mothballed as a result of failing to secure contracts for turbines to be installed off Fife[3] and CS Wind, Britain’s only UK facility for manufacturing wind towers, which is now down to just one full time member of staff and has no orders scheduled.[4]

●        Major new factory and supply chain manufacturing investment is needed to secure much more than the current percentage of UK content (which is currently 48% compared to the government's target of 60%)[5]. That means investments in ports and dockyards but also turbine factories, blade factories, jackets and foundations production etc. The £160m committed by the Government in the 10 Point Plan for this kind of investment is not enough; much more will be required in the Budget and Spending Review in 2021. More investment in offshore wind skills training is also required. To deliver the investment needed for these things, more direct government funding is needed, as well as additional packages of support for companies through the supply chain, e.g. loans & grants.

●        Stronger UK content requirements also need to be applied to developers through the CfD auction regime. The Government is currently consulting on this but they have not made clear what the minimum UK content requirements will be (or if any will be set at all) as a condition of developers being eligible to compete for contracts, and they have not outlined how (if at all) they will establish an incentive framework to encourage developers to make bolder UK content commitments.  All that is currently clear from the AR4 CfD consultation is that the government is proposing a slightly more stringent approach to ensuring that developers' own UK content commitments are delivered upon.

5. What risks are there to meeting the Government’s ambitions for green job creation in both the public and private sectors? What should the Government do to create the conditions to ensure its commitments are met by both sectors?

●        In some sectors identified as having high job-creation potential, such as the clean power and transport sectors, the government could attract major private-sector investment through the implementation of policy changes like those identified in Greenpeace’s manifesto.[6] Current government approach to green job creation is both insufficient in levels of public investment, and piecemeal in policy terms, slowing down progress and missing opportunities for significant job creation.

6. Are the Government’s ambitions for green job creation in the public and private sectors sufficient for the scale of the challenges? What changes should be made?

●        Current ambitions are insufficient. In the first instance, meeting our climate targets requires a significant increase in investment, either from the government or from the private sector, which will create 1.8 million green jobs while decarbonising the UK economy. More detail can be found in Greenpeace’s ‘Jobs and the Green Recovery’ report.[7]

7. How can the UK ensure jobs are created in areas most impacted by the transition to a low-carbon economy?

●        Many of those at risk of unemployment at present are in sectors that require few formal qualifications and offer little in-work training. Therefore a proactive approach is needed now, with support for significant reskilling and training in order to help the workforce transition, to increase incomes and to boost productivity.

●        As part of this, devolved nations, city mayors and local authorities should be empowered to design and deliver just transition strategies that fit with specific local and regional needs. They should be given extra powers and resources to work with unions, trade associations and business groups such as the Confederation of British Industry to aid skills development, retraining and local investment – especially in places where many people are employed in carbon-intensive industries or their support industries. For example, while a faster transition to EVs through a phaseout of new petrol and diesel cars and vans by 2030 could deliver employment growth to the auto industry compared to a later date, 11% of current jobs in the sector are specific and non-transferable. A specialist programme of retraining and reskilling in EV assembly and manufacture will be required to address this issue.[8] Similarly, growing numbers of skilled workers from the oil and gas sector are already being reemployed in sustainable industries – for example, over a third of the offshore wind industry’s marine engineers used to work in oil and gas.[9] However, significant specialist retraining and re-skilling of oil and gas sector workers with less transferable skills will now be required at pace, especially in the wake of the oil price crash and thousands of associated job losses that are now forecasted.[10] Over the next three years, as a starting point, the proposed Shared Prosperity Fund of £2.16 billion per year should be at least doubled to support tailored just transition programmes of this kind.[11]

●        The government should also explore delivering a new green jobs and training guarantee programme, as recently proposed by the Social Market Foundation.[12] This would ensure that those who cannot otherwise find employment after the lockdown get a job and are paid at least the national living wage. 20% of the working week could be spent on training and education, with a particular emphasis on placements that help fill the low carbon skills gap in key areas such as home insulation, as identified by the Committee on Climate Change last year.[13]

8. What additional interventions should be undertaken to aid in a ‘just transition’?

●        In Greenpeace's recent joint report with Platform and Friends of the Earth Scotland following a survey of 1.3k offshore oil and gas workers, we found 81% would consider leaving the industry and, given the option of retraining to work elsewhere in the energy sector, more than half would be interested in renewables and offshore wind.[14] Yet despite attempts by individual workers to transition, the conditions present multiple challenges & the barriers to entry are high due to lack of coordinated retraining and reskilling strategies. This could at least in part be overcome through regulation and government support (e.g. standardising certification for offshore work across oil and wind so workers can move more easily between the industries, fund skills and retraining programmes etc.)

9. What impact can green jobs have on the wider UK economy?

●        Increased government investment in green jobs could insulate homes, reduce electricity bills and cut fuel poverty, thereby reducing the thousands of deaths caused by cold housing in the UK every year. It could improve sustainable transport and address air pollution, transforming the health of our cities. It could revive natural habitats and safeguard these essential spaces for future generations, while building on the remarkable success of the UK renewables industry. This would create a robust, zero-carbon economy that is fit to tackle the climate crisis. A green recovery is essential to solve both the immediate unemployment crisis and the long-term existential threat of the escalating climate emergency

●        A recent Greenpeace report, written by Cambridge Econometrics, supported by Element Energy, used the DfT’s (Department for Transport) transport model and a macroeconomic model to assess the impact of a faster transition to electric vehicles on consumer spending, emissions, government revenues, the car industry and the economy as a whole.[15] The study found that bringing forward the date from which new petrol, diesel and hybrid cars and vans can no longer be sold in the UK to 2030 could create 32,000 new jobs by the same year and increase GDP by 0.2% – or £4.2 billion pounds, compared to a phaseout date of 2035. It also found that increases in employment and resulting higher levels of economic activity from a 2030 transition to electric vehicles would provide the government with a £1.9 billion net increase in revenue by 2030. Within these jobs calculations, the report found that thousands of new jobs would be created across a range of sectors directly linked to the rapid transition to electric vehicles including energy, battery manufacturing and a mass roll out of charging infrastructure. However, the majority of new jobs would be created in the wider economy - in particular service industries, such as retail, entertainment and leisure. This increased economic activity is a result of the lower overall costs of owning and running an electric vehicle, lower demand for imported oil and its replacement by UK-generated electricity, meaning consumers have increased disposable income and spending is reallocated, frequently towards industries that are currently struggling under Covid restrictions.

10. What contribution can green jobs make to the UK’s economic recovery from Covid-19?

●        In the wake of the Covid crisis, hundreds of thousands of people across the UK could lose their jobs as a result of the necessary restrictions on economic activity and the shrinking of many sectors. At the same time, a successful green recovery will create a huge number of new skilled jobs across the country in a range of emerging and expanding low carbon industries. These new jobs could help secure the long-term economic security of thousands of households, while boosting GDP, increasing private investment and tackling the climate emergency.

11. How can the UK ensure high emissions are not locked-in when tackling unemployment?

●        Lessons must be learned from the response to the 2008 crash, when vast sums were given to banks and high-emission industries, contributing to faster emissions growth in 2010 than before the crisis. Austerity also cannot be repeated, which pushed many into greater poverty and exacerbated inequality across the country. Support for businesses and communities needs to lay durable foundations for a healthier, more sustainable and resilient society in the long term.

●        In the words of the UN Secretary General, we need to ‘recover better’.[16] In practice there is no conflict between economy and environment. As a recent study by Oxford University Smith School said, “there is strong evidence that green stimulus policies are economically advantageous when compared with traditional fiscal stimuli.”

●        Any short-term financial rescue packages for companies in response to the coronavirus outbreak should be granted only on strict conditions that are compatible with a green recovery. This is particularly important given that the sectors in which companies are asking for bailouts include some of the most polluting industries, such as aviation and fossil fuels, with billionaire business owners asking for taxpayer money to prop them up in order to continue with business as usual once the crisis has ended.

●        Specifically, any financial rescue packages should align with the following principles, so as to complement rather than undermine the creation of favourable market conditions for a green recovery:

●        Put people and workers first. Companies receiving bailouts must suspend dividends and executive bonuses until any state-backed loans have been repaid in full; they must ensure all workers maintain a full and secure income for the duration of the crisis; and government and industry must support workers in high-carbon industries to reskill and find good, well-paid jobs in sustainable sectors, such as those outlined above.

●        Protect the environment. Any polluting sectors or companies should be required to take immediate steps to align with the Paris Agreement temperature targets, and to develop a longer-term plan to decarbonise, without reliance on offsetting.

●        Account for public spending on rescue packages. Companies receiving bailouts should be required to report publicly on their spending of the funds they have received.

January 2021