Miliband’s net zero promises are false, Tony Blair’s think tank warns

Investing in green technology unlikely to reverse long-term decline of British industry

Daily Telegraph 

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Ed Miliband’s claim that net zero will create hundreds of thousands industrial jobs is vastly overstated, Sir Tony Blair’s think tank has warned.

The Tony Blair Institute for Global Change (TBI) said investing in green technology was unlikely to reverse the long-term decline of British industry and warned that ministers must not “over-state the job opportunities from green manufacturing”.

The think tank added that it was a “mistake” to let net zero dominate the Government’s entire economic strategy as it would deliver only a meagre boost to growth. It said: “It must be a pillar of the UK’s growth strategy, but it cannot be the whole strategy.”

The assessment comes after tensions emerged within the cabinet over the net zero agenda. Rachel Reeves, the Chancellor, said last month that carbon emissions had too often been used as an excuse “not to invest” in an apparent split with Mr Miliband.

Labour’s election manifesto promised a “Green Prosperity Plan” that “will create 650,000 jobs across the country by 2030”. Mr Miliband has also said that the Government’s net zero plan will involve “backing our proud manufacturing, coastal and oil and gas communities with good jobs, skills and private sector investment”.

However, the TBI report cast doubt on the plausibility of Labour’s targets. It said green manufacturing was likely to employ only 425,000 people by 2050 in a “best-case scenario” – a third less than than promised and decades later.

Tony Blair speaking at the Tony Blair Institute for Global Change's Future of Britain Conference at the Park Plaza Westminster Bridge hotel in central London

Tony Blair’s think thank has said the Government ‘must be careful not to over-state the job opportunities from green manufacturing’ Credit: Yui Mok/PA

The think tank added that green manufacturing was more likely to employ just 350,000 people by the middle of the century. That is half the number who currently work in “grey” industries, such as oil and gas or carbon-intensive manufacturing.

“The Government must be careful not to over-state the job opportunities from green manufacturing,” the TBI’s report said.

“As manufacturing sectors have become more efficient over time, they have accounted for a shrinking share of the workforce. The green transition is unlikely to reverse this long-term trend in the UK.”

Net zero industries have no hope of replacing the jobs that currently exist in traditional factories, it added.

It comes a week after Mr Miliband launched the “clean industry bonus”, an investment scheme for offshore wind developers “on the condition they prioritise their investment in areas that need it most, including traditional oil and gas communities”.

Britain should ‘court’ Chinese manufacturers

The TBI predicted that “fully capitalising on the net-zero transition … could lift the UK’s annual growth rate by 0.1 to 0.2 percentage points over the next 25 years, a vital boost at a time of sluggish growth.”

However, this is not in itself revolutionary and the boost may not even materialise given tough competition from around the world and other nations’ efforts to grow in these industries.

“Betting everything on green growth would therefore be a mistake.” the Institute said.

It also cautioned that the Government was wrong to spend £2.5bn on support for environmentally-friendly steel production and just £1.5bn on incentives for gigafactories, when electric vehicles promise to be a bigger growth market.

As well as pouring more money into EVs, the TBI argued Britain should vigorously court Chinese manufacturers, encouraging them to set up plants in the UK as traditional internal combustion carmakers struggle to adapt to the new market.

It said: “In the 1980s, the government successfully revitalised the sector by attracting Japanese automakers and leveraging access to the European market. Today, it must pull off the same feat – but in far tougher conditions.

“To stand out, the UK must pursue a deliberate, distinct strategy of strategic openness – continuing to reject import tariffs on Chinese EVs, in contrast to the EU, US and others.

“And despite the complex security relationship, the UK should actively court investment from China’s world-leading EV manufacturers, as part of a broader effort to rebuild the UK’s position as a major auto producer.”

A government spokesman said: “From carbon capture and storage in the north east and north west, to hydrogen projects across the country, we’re delivering thousands of jobs for our industrial communities.  

“Our industrial strategy will also take advantage of the UK’s unique strengths and untapped potential, enabling our already world-leading services and manufacturing sectors to adapt and grow, with high quality, well-paid jobs.”