UKSIF Response to the Spring Budget 2024

In response to the Spring budget announced by the chancellor in parliament today, CEO James Alexander, issued this comment on behalf of UKSIF.

“The Spring Budget included several proposals designed to cajole UK savers and the financial services industry into investing more in the UK. Forcing pension funds to disclose rates of UK investment, or increasing the ISA allowance for investment in British firms, fails to resolve the policy barriers driving private capital abroad, particularly in sustainable industries, which are our biggest source of future growth. Our members are clear that the answer to unlocking billions more in private investment lies in demonstrating policy certainty and ensuring the UK has high-quality investable projects with long-term growth potential.

UKSIF is pleased to see that the government’s spring budget includes planning and grid connection reforms which we have been calling for several years as a measure that will help to drive private investment into the UK’s clean energy industry. Our Energy report, released in late February, clearly shows that planning wait-times and insufficient grid connectivity has driven as much as £115bn in private investment overseas. Points 5.83 to 5.85 of the budget’s red book demonstrate a will for crucial differentiation in planning permission timelines to speed up Nationally Significant Infrastructure projects such as wind farms, which will ultimately lower household energy bills and drive the UK’s net-zero transition.

The chancellor has announced that this government is due to deliver one million new homes this parliament. We would urge the government to consult with industry to ensure that all subsequent new homes are built with net-zero in mind, so that they will not require expensive retrofitting in the near future. The housing sector is among the UK’s biggest emitters, and the UK has a golden opportunity to expand its housing stock in a way that saves people money on their energy bills while progressing towards our legally binding net-zero targets.

Tight public finances make it all the more important for the UK to take policy measures to attract private investment into sustainability projects. In order to compete with the US’ Inflation Reduction Act and the EU’s Green New Deal, the UK must remove the barriers which are currently driving private investment overseas in major growth areas of the future such as wind farms, hydrogen fuel, and EVs. The UK has a clear choice, to seize the golden opportunity within reach to become a green superpower, delivering highly skilled jobs and billions in investment, or to be left playing catch up.”

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