A promising start with more to follow: The Prime Minister’s Ten Point Plan and next steps for business

The Prime Minister’s Ten Point Plan on a ‘green industrial revolution’, published last week, can be read as a statement of intent to accelerate the move to a net zero economy, create green jobs, and spur on the levelling up agenda. It shows government’s thinking on the future of sectors which will play a key role, from energy to transport and housing. But how will this vision be implemented and what does it mean for businesses in these sectors? WA this week hosted a webinar with policymakers and industry experts to explore these questions. Caitlin Fordham shares our key takeaways on the plan and next steps:

It’s in the detail, and the detail is still to come

The Ten Point Plan has been widely welcomed as providing clear policy and regulatory signals to the sector. Having deadlines for roll out will spur innovation, but a more detailed policy framework is now required – and expected – to provide greater clarity on how this vision will be delivered.

From developing the first hydrogen town to bringing forward, by a decade, the ban on the sale of petrol and diesel cars, huge questions remain over how exactly these flagship commitments will be delivered.

Before the end of 2021, we expect a string of strategy papers and consultations – from the Energy White Paper and Net Zero Strategy to the Transport Decarbonisation Plan – which will go some way to answering these questions. However, not every question will be answered right away.

In responding to these, businesses can shape what comes next and the direction of travel that the UK’s policy framework takes. This means laying the groundwork now and thinking about what you’ll need to do at each stage to get the outcome you need. It is about making consultations work for you and using them as a platform to set out a wider narrative beyond engaging on technical specifics.

Who pays for it and where does the money come from?

Tackling climate change will require significant government investment at a time when the pandemic response has taken its toll on public finances. The IPPR has estimated the government will need to spend £33 billion a year to reach its net zero target, but this package amounts to just over a third of that figure at £12 billion. The plan represents the start of a battle between Number 10 and Treasury on how the green industrial revolution is funded.

While Number 10 wants to be bold on climate and environment, and sees this as a political priority, the Treasury is cautious about committing to significant public funding at a time when finances are stretched. The government is betting on regulatory and policy signals – such as bringing forward the 2030 ban on the sale of petrol and diesel cars – to open-up significant private sector financing in support of its ambitions. By providing some kickstarter funding in specific areas alongside setting targets and creating new market frameworks for heat networks, for example, the government will hope it can provide consumers, businesses and investors with confidence and spur innovation.

In the context of this week’s Spending Review, the Treasury will need to consider how much more public money can be pumped in to top up this plan and which regions and sectors should benefit. It will also need to consider ultimately where this public money comes from. Road pricing or an end to the fuel duty freeze are options to free up cash to spend on developing EV charging infrastructure. The Net Zero Review – expected next year – will analyse the range of choices for funding the transition and set out greater clarity on the balance between taxpayers and bill payers. Businesses should keep this front of mind and consider what is realistic to ask for and how your proposition can create value for government.

Return to the levelling up agenda

You cannot read this plan without having the government’s commitment to ‘levelling up’ at the front of your mind. The plan places at its heart regions and communities which the government has promised to level up, including the North East, Yorkshire and the Humber, Scotland, and Wales. By delivering for these communities the Prime Minister will hope his party can retain non-traditional seats won at the last election.

Place is critical for the government’s wider agenda and you can see that reflected in the plan. The plan roots policy promises in terms of outcomes for communities across the UK, from coastal towns to industrial heartlands.

This is evident through the focus on creating high-skilled, green jobs in areas like the Humber and Teeside. To get there, we will need to see a comprehensive strategy on skills and reskilling, which will likely form another ‘reset’ announcement. Government will need businesses’ buy-in as part of this. It will not just be enough for the energy sector to show how it is achieving net zero; it also needs to communicate how their plans support government on jobs and wealth creation in these areas.

What does this mean for business and what should you do about it?

• This is just the start and there is a long road ahead which will involve a flurry of activity and detailed policy processes. Plans are not yet set in stone but what we have seen are statements of intent which now need policy and regulatory frameworks to bring them to life. Now is the time to start developing your narrative and building relationships with key stakeholders. Policy does not write itself and there are a series of milestones before decisions are made. You will need to engage across these milestones, from informal meetings to formal consultation responses, to ensure outcomes support your objectives.

• You need to show government how you can solve problems. You need technical detail and data to support your arguments, but you also need to tell a positive story about your business and frame your asks as wins for government based on its various agendas, from levelling up to net zero. Look at offshore wind – one of the biggest winners in this plan. This is a direct result of the industry’s ability to showcase how they not only help decarbonisation but also support jobs and UK export.

• You should build alliances now that will support you in developing support across government. Net zero and decarbonisation do not simply sit in one department. For example, you may need final sign off from Number 10, funds from Treasury, and to brief officials in teams across different departments. You may also need to bring industry and consumer groups along with you. To be successful in this, you need to make sure you’re talking to the people that will be shaping decisions that impact you and start the groundwork now.