Memorandum submitted by the North East
Chamber of Commerce (NECC)
The UK, and more specifically the UK economy,
has the potential to become a world leading green economy. The
North East has already established itself as a leader in the fields
of innovation and development of carbon abatement technologies
and renewable power. NECC firmly believes that the region will
go on to be central to the development of these technologies and
to the growth of the UK economy as a whole.
Green jobs and the skills central to these jobs must
be central to any UK Government's policy framework. The Government
has recognised this, and Budget 2009 exemplified this, with over
£1billion offered in green energy and technology funds, as
well as money earmarked for off shore wind, Carbon Capture and
Storage (CCS), and other projects also.
NECC welcomes the opportunity to submit evidence
to the Environmental Audit Committee (EAC). Our submission will
cover the following points in more detail:
— Regulation: It is important that
the regulatory regime does not hinder the growth of green industries
and the industries peripheral to them.
— Tax: The fiscal policy framework
must incentivise investment and take account of the infrastructure
development that is needed in the North East.
— Skills: If green industries are
to play a major part in Britain's economic future, now is the
time to actively encourage young people to pick up the skills
that will allow them to be the leaders of these industries in
the future.
In so far as carbon abatement and energy efficiency
are concerned, businesses and academic institutions in the North
East are already leaders in their respective fields, and we have
an important role to play in the development of these areas as
an energy intensive region. The North East is not only home to
a plethora of green businesses, it hosts a range of leading research
centres, such as the New and Renewables Energy Centre (NaREC)
in Blyth, the Centre for Process Innovation (CPI) in Teesside,
and four regional Universities with various green research specialisations.
There must be investment in vital North East
infrastructure projects that provide much needed capacity for
businesses and unlock economic growth also. Ports, airports, the
rail network, and road infrastructure all need to have sufficient
connectivity and capacity to cater for the growth that is set
to occur around our existing industrial sites. If there is not
sufficient investment in this infrastructure stock it will be
more difficult for the North East to consolidate the inward international
investment and commitment to the area we have secured in recent
years.
There must be a moratorium on new regulations
during the recession. Both domestic and EU regulations are placing
added burdens on businesses that are also facing added pressure
from increasingly difficult trading conditions. Where regulations
cannot be avoided, they must be clear and consistent.
NECC has been informed by members of instances
where complying with the Renewables Obligation (RO) has had to
come at the expense of plant efficiency. This resulted in energy
being wasted rather than saved in order to comply with green legislation.
Inconsistencies like this must be recognised and remedied if the
Low Carbon Industrial Strategy is to be successful.
The Low Carbon Industrial Strategy (LCIS) is
an outline of the objectives the Government has set with regards
to achieving a low carbon economy. It is an important framework
that sets out the areas where carbon can be saved and where the
economy can benefit in the process. The fiscal and regulatory
regime, as well as investment in skills and infrastructure, will
determine how quickly and effectively this transformation is expedited.
The planning culture in the UK must become more
favourable to development. There must be a fundamental shift from
the culture of development control to a culture of encouraging
development and presuming a project has economic benefits and
it is thus worthwhile unless proven otherwise. Planning decisions
on clean energy projects by local authorities must match UK objectives
for environment and energy security.
Budget 2009 provided a welcome fiscal support
for green industries, and NECC welcomed the introduction of a
£1 billion support package for green businesses and research
centres. The effectiveness of the LCIS will depend upon policies
such as these, as well as a general acceptance that tax and spending
in the UK must support enterprise, innovation, and growth. It
is also crucial that the R&D tax credit system must continue
to grow and support innovative and technology orientated businesses.
The North East already possesses a strong skills
base in the manufacturing, engineering, construction and offshore
industries. It is essential that the Government's approach to
job creation/stimulation makes the most of those skills which
can be easily transferred into green industries. There are already
many examples of green businesses setting up in areas hit hard
by the decline of traditional industries.
However, many of the traditional industries
mentioned above have been subject to a decline in the pool of
skilled and qualified young people over a number of years. Historically,
large companies in the region, such as ICI, would over-recruit
young apprentices; thereby providing skilled workers to similar
businesses in the area. The decline of large manufacturers such
as ICI has inevitably reduced this.
NECC supports the Government's commitment to
expand the apprenticeship programme and recognises the significant
gains made in the number of young apprentices since 1997. However,
much more needs to be done to engage with green energy/environmental
sector to build capacity and provide skilled workers for the future.
NECC is also concerned at the perceived lack
of interest in those 14-19 Diplomas which will provide young people
with a solid foundation for progressing into green industries.
The Science, Engineering and Manufacturing Diplomas must continually
adapt to the needs of employers and the future jobs market. This
can only happen through committed engagement at all levels between
schools, employers, local authorities and the Government. If green
industries are to play a major part in Britain's economic future,
now is the time to actively encourage young people to pick up
the skills that will allow them to be successful in these industries
in the future.
June 2009
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