While people were digesting the announcement of the latest strike prices for renewable energy, the Treasury was also releasing its latest update of the infrastructure pipeline. This reported substantially lower spending on investment in offshore wind energy up to 2020, partly compensated by higher expected investment in onshore wind. Seen against the background of the substantial cut in the pipeline of offshore wind projects, the decision to provide relatively more support for this form of renewable energy makes sense.
George Osborne will have my sympathy when he sets out his response to the latest projections in his Autumn Statement. Like his predecessors, he will be painfully aware of the inherent unreliability of these forecasts. A year ago there was talk of a triple dip recession, but now we have had a few quarters of decent growth. Yet, despite the recent positive statistics, there remains a huge gulf in perception between the optimists, who see the emergence of a robust recovery, and the pessimists who see a lack of firm foundations for anything beyond a short lived pick up. Read more
This post first appeared on the New Statesman blog.
Among the many extravagant claims made by supporters of fracking, perhaps the most absurd is that it will lead to a renaissance in British manufacturing. George Osborne picked up this theme last week when he argued that cheap energy was leading manufacturers to return to the US and he wanted to see this happen in Britain. Read more
This post by Green Alliance’s chief economist Julian Morgan first appeared on BusinessGreen.
Visit the ONS website and you will find many interesting statistics, but perhaps not the ones that you are looking for. Last week I stumbled across a very salient example. Under the heading “manufacture of measuring, testing and navigating equipment” you can find monthly data on the average earnings of those making watches and clocks. Indeed, I noticed that they seem to be doing rather well, as provisional estimates suggest their pay rose 3.6 per cent in the year to March 2013. Read more
Talk is cheap: why the gap between rhetoric and reality in the coalition’s infrastructure policy matters
This post by Green Alliance’s chief economist Julian Morgan. It first appeared on the New Statesman economics blog.
Ministers should not be under any illusion that public spending on high carbon projects offers a quick economic fix.
Amid all the headlines about the biggest programme of road building for 40 years and announcements of new support for fracking, you would be forgiven for thinking that the recent Comprehensive Spending Review meant an abandonment of plans to decarbonise Britain’s economy. Thankfully, that’s not what our analysis of the Treasury’s own numbers shows as the plans for upgrading Britain’s infrastructure still remain focussed on public transport and renewable energy. However, there are major contradictions at the heart of the government’s policy, which risk deterring the very private sector investors who are needed to implement many of these projects.