The UK government must not forsake the net zero transition in its bid for long-term growth, the UK Sustainable Investment and Finance Association (UKSIF) has urged.
“Long-term growth and sustainability are mutually reinforcing, given the material risks climate change poses to businesses across the UK and the huge opportunity the UK has to deliver the jobs and growth of the future as a leading sustainable economy,” said UKSIF chief executive officer James Alexander.
His comments come after UK chancellor Rachel Reeves said that the pursuit of growth “trumps” the government’s net zero commitments.
Speaking this week at the World Economic Forum in Davos, Reeves said that growth is the UK government’s “number one mission”.
Asked at the forum what she would do if given the choice between economic growth and the UK’s 2050 net zero target, Reeves said: “If it’s the number one mission, it’s obviously the most important thing.”
Alexander, who has long advocated for the UK government to enact more favourable sustainable policies, added that: “Policymakers should ensure that any easing of planning regulation and judicial reviews also covers critical infrastructure for the UK’s net zero transition, including solar farms, wind farms and grid connections. The reward will be billions of private capital investing into sustainable growth across the country.”
Reeves’ comments at Davos come as the government is debating whether it should back expansion plans for major UK airports, including deciding whether or not to approve a third runway at Heathrow Airport. Reeves is expected to signal her support for a third runway in a major speech on the government’s plans for growth next week.
Last year, UKSIF published a report, ahead of the general election, warning that the UK’s leadership in sustainable finance was under threat.
The report found that more favourable policies could see up to £100bn (€116.5bn) of assets under management shifting towards sustainable finance in the UK.
“The UK’s green finance lead is at risk of slipping behind, and with it its share of the £23.8trn which is currently invested globally in sustainable investing assets,” the report stated.
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