The Green Transition: The King's Speech
Weekly analysis of the shift towards a new economy.
Dear Readers,
Happy Friday from the Spotlight on Policy team.
A momentous week this week, when a Labour government, a Labour government (in the words of Neil Kinnock), introduced a legislative agenda to parliament for the first time in 15 years. There’s plenty to talk about, with analysis below.
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Let’s get right into it.
The King's Speech
Every country has its foibles and its own version of state-sanctioned pomp and ceremony. At US presidential inaugurations, we get treated to pop mega stars like Beyoncé, Lady Gaga or Bruce Springsteen belting out patriotic ballads over the crowds in Washington. The equivalent in the French republic involves a 21-gun salute and a ritual in the elaborate Élysée Palace, with chamber music playing in the same rooms that Bourbon aristocrats would have dined in before the Revolution. In Britain, for a slightly different kind of occasion, we get to see someone in fancy dress called the “Black Rod” get a door slammed in their face outside the House of Commons, before summoning MPs to hear the monarch read out plans for the government’s legislative agenda. The State Opening of Parliament and King’s Speech features figures in ermine cloaks listening attentively to a bejewelled King Charles talk about bus franchising and disposable vapes. It’s a funny old world.
And King Charles had a lot to say about green policy this time around.
“For us it represented a serious step-change in ambition from the government,” the Green Alliance think tank’s director of politics, Chris Venables, tells the GT. “If you think back to the King’s Speech in the last couple of years, we’ve had the Conservatives pushing on North Sea oil and gas, as well as watering down all sorts of net-zero policies. So for us to have a government recommitting to the basics and putting forward a whole load of legislation on buses, rail, energy at the heart of the agenda, it’s really exciting.”
The Institute for Public Policy Research’s (IPPR) Zoë Billingham was also pleased with how Wednesday went: “It’s a relief after many frustrating years to hear from a new government that not only recognises the scale of the challenges we face as a nation, but is also ready to deliver.” Two IPPR head honchos also headed to Downing Street this week. Carys Roberts, the executive director and number 33 on the New Statesman’s 2024 Left Power List, as well as associate director Rachel Statham, have both accepted Policy Unit roles. They join the progressive think tank’s former energy and climate lead Luke Murphy – now MP for Basingstoke – in an IPPR Westminster takeover.
Already we’ve had confirmation on new oil and gas licences being halted, the ban on onshore wind being lifted, and the approval of new windfarms, much to the chagrin of certain local MPs. The King’s Speech also mentioned the establishment of a National Wealth Fund, and Great British Energy. On the latter, there has been heated debate around whether the new vehicle would simply be a way of “de-risking” private investment, or act as an energy-sector version of the Blair-era private finance initiative (PFI) – or whether GB Energy would actually constitute a state-owned, renewable energy production company.
That argument appears to have been tentatively settled: the new organisation, as well as crowding in and working in partnership with private actors, will be capitalised with £8.3bn of public money and will “develop, own and operate assets”, according to a draft introduction to the bill. That means the taxpayer should get a return on its investments, and that GB Energy will actually be producing, er, energy – not simply nationalising losses and absorbing the sector’s risks while private investors reap rewards. Chris Stark, the former head of the Climate Change Committee who our sustainability correspondent Megan Kenyon profiled just before the election, will lead on the government’s net-zero mission.
“My ministers,” said King Charles, “will also ‘get Britain building’,” through – you guessed it – “planning reform”. As regular readers of the GT will know, tearing down the bureaucratic hurdles to development by removing so-called stakeholder (aka: Nimby) vetoes, is seen as a way to “accelerate the delivery of high-quality infrastructure”. That includes miles of controversial new pylons through England’s countryside, which are already causing political headaches for new Green MPs who have taken over in leafy, formerly true-blue constituencies in Suffolk and Herefordshire. The Energy Secretary, Ed Miliband, has already had a dig at the Greens for opposing renewable-energy infrastructure on their own patches.
But energy isn’t the only area that needs attention if we’re to meet our net-zero targets. The Green Alliance’s Venables is confident that even with the relatively modest level of public investment, the clean-power mission is achievable. “The private sector,” he tells the GT, “is quite well placed to turn it into a serious investment agenda. A lot of technology is quite developed – offshore wind, onshore and solar – and the grid upgrades are primarily doable, but that’s what’s so important about planning.”
In other areas, though, there will be challenges, “on things like public transport, home insulation, restoring nature – all critical parts of the net-zero pathway. As it stands, with the current investment level, it’s really hard to see how we would meet climate targets.”
As the Lords and MPs gathered to watch the pageant on Wednesday, and the Crown-in-Parliament was on full, regal display, we heard about a new era of public ownership for rail, and devolved powers for local authorities and mayors to improve local transport links through bus franchising. Much-improved mass transit systems, as well as more energy-efficient building stock, are sorely needed as we transition to a low-carbon economy. But the King’s Speech didn’t give us any surprises – it was all familiar from previous announcements or the Labour manifesto.
In many ways a more important speech is yet to be made: the Chancellor Rachel Reeves’ first presentation of a Budget to the House of Commons, set for the autumn. Reeves has said the date will be announced before summer recess (30 July) and that she will “assess the spending inheritance” left by the previous government. Already she has warned of “difficult choices”. Reports before the election suggested she intends to pursue a “kitchen sink” approach, when a new leader gives the public all the bad news at once, to justify drastic measures such as the raising of capital gains tax, or the introduction of a new hypothecated tax for specific services – a nifty (if not entirely on-the-level) way of sticking to promises for no new VAT, national insurance or income tax rises).
Whatever plans are being cooked up in Downing Street, the public realm is in dire need of investment. The legislative agenda of the new government has been revealed, with positive structural tweaks, regulatory reforms, and new organisations established to give it all strong institutional backing. The missing link is the fiscal heft to accompany it.
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