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Energy policy and the environment

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LAST WEEK The Herald looked at the energy market and the ways in which different parties have approached the question of rising domestic energy bills.

That article discussed the ways in which taking advantage of existing energy efficiency schemes and the use of the most competitive tariffs would reduce bills far more than a simple price cut on the most commonly used domestic tariff.

Labour has claimed it will create over 300,000 renewable energy jobs throughout the country and put modern low-carbon industries at the heart of a £500 billion investment strategy, championing ‘a new green industrial revolution’.

One of the big ideas underpinning that commitment is to promote the growth of local energy companies and support the development of 1,000 community energy co-operatives. That’s accompanied by a commitment to 65% renewable electricity by 2030, aiming for 85% as technology improves and diffuses.

All of which will sound very familiar to Plaid Cymru, whose Shadow Environment spokesperson, Simon Thomas AM, has called for the creation of Ynni Cymru to promote Wales’ own self-sufficiency in domestic energy. It sounds like Plaid’s clothes have been lifted by Jeremy Corbyn’s promises to invest in similar schemes and raise investment across the UK.

Labour has set out a radical commitment to set up publicly-owned energy supply companies in every region focused purely on cutting prices. Under the same proposals, Government would take ‘control of the natural monopolies of the transmission and distribution grids’ currently run by the National Grid.

The Labour leader has made big promises, and the cynical might think that Labour may as well shoot for The Moon, given the remote chances it has of forming an administration under Jeremy Corbyn as PM.

“We’ve got a real opportunity to drive the green economy – to have green jobs, green growth, and make sure that we have our share of the industries of the future. Clearly there’s the climate change agenda, where we’ve got to get back on track, both nationally and internationally. And third, there is the issue of energy security, which I think is vitally important, which we need to do a huge amount of work on.”

Those were big promises, too. They were made seven years ago by David Cameron at the outset of his first term as PM, when he pledged to lead the greenest government ever. By 2013, David Cameron was keen to ‘get rid of all the green crap’, as the hopes of 2010 smashed into the economic and political realities of Treasury austerity.

The rug was pulled from under the renewables industry: following through on the pledge to virtually ban onshore wind, and slashing the feed in tariff. Overall UK carbon emissions had been falling but the growth in renewables deployment stalled, and solar companies employing thousands of people around the country went bust.

Five years later, at the outset of his second term, David Cameron pulled the Green Deal for UK homes.

On every single one of those policy decisions, commitments, and staggering reversals Theresa May went along, bobbing along like a cork on the tide of Cabinet collective responsibility. The number of times she has spoken out on energy policy in public can be counted on the fingers of one thumb. However, she merged the Department of Energy and Climate Change into a new Department of Business, Energy and Industrial Strategy in July 2016.

While that suggests a rather less overtly ‘green’ approach to the PR side of politics than her predecessor, it is noteworthy that Theresa May has expressed consistent and strong positions on the issue of energy security. Her first noteworthy public policy decision was to initiate a pause on the development of Hinkley B, ostensibly due to concerns of increasing UK reliance on Chinese investment in its energy infrastructure.

In addition, in a complex and volatile international energy market, there are clear attractions for the PM in adopting measure which enhance energy security and the reduction on the reliance of overseas energy. Her concerns on energy supply were echoed in the 2015 Conservative manifesto, which said: ‘Without secure energy supplies, our country becomes less safe and less prosperous’.

And, in 2008, Mrs May said: “I am thrilled to see that after years of Conservative pressure, we have finally passed a necessary and ambitious piece of legislation on Climate Change. Britain is the first country in the world to formally bind itself to cut greenhouse emissions and I strongly believe this will improve our national and economic security.

“To stay reliant on fossil fuels would mean tying ourselves to increasingly unstable supplies which could endanger our energy security and the Climate Change and Energy Bills mark an important step for both the health of our economy and the health of our nation. It is now vital that we stick to these targets.”

The logic of Mrs May’s evident and consistently expressed concerns on security of energy supply is to make the UK more self-sufficient. There are two sides to that issues: firstly, the extension of green energy generation; secondly, the extension of fracking and nuclear power.

The second limb of that proposition is the most contentious. Fracking is a public relations disaster waiting to happen and the first time it is scheduled to take place in a Conservative-held marginal seat is when we will see just how committed the Conservative party is to its use. As for nuclear power, it requires considerable public support and subsidy to make it even marginally viable for the long term.

The only large energy project requiring anything like the level of price support as nuclear power is the Swansea Tidal Lagoon, which for all its carbon-saving claims involves quarrying stone in Cornwall, building new jetties extending into the Bristol Channel and transporting the stone over by barge to Swansea by the thousands of tonnes to build a tidal barrage affecting marine life and habitats across the whole of Swansea Bay.

For someone as sensitive to polls as Theresa May it is worth noting that the BEIS tracker surveys on consumer views shows significantly higher support for renewable energy (at around 75-80%) than for other options. Opposition to renewables was very low at 4%, with only 1% strongly opposed.

However, and this is where energy policies and political judgement come into play, support for renewables was lower amongst those in social grade DE (72%), aged 65+ (73%), and social renters (75%).

The first two of those groups are key electoral demographics whose support Theresa May is actively courting. The triangulation of Conservative policy on energy, which now appears to have abandoned the notion that competition delivers the best results for energy users, might not swing a lot of votes, but the Conservative leader will not be shy of using every gimmick in her arsenal to court wavering voters looking for a way to justify voting Conservative.

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Kwarteng gambles on rush for growth

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CHANCELLOR of the Exchequer Kwasi Kwarteng unveiled his and Liz Truss’s economic vision for the UK on Friday morning.

The headlines are straightforward.

There will be £45bn in tax cuts by 2027; however, the largest cuts – national insurance cuts, the abolition of the cap on bonuses and the highest income tax rate- benefit only high earners.

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Cut in the basic rate of income tax to 19% from April 2023;

National Insurance will not rise as scheduled, and the Government will reverse the current year rise as of November 6;

New Health and Social Care Levy to pay for the NHS will not be introduced;

The top rate of income tax was cut from 45% to 40%;

Cancel the rise in corporation tax which was due to increase from 19% to 25% in April 2023;

Rules around universal credit tightened by reducing benefits if people don’t fulfil job search commitments;

VAT-free shopping for overseas visitors;

End of the cap on bankers’ bonuses;

Planned increases in the duties on beer, cider, wine, and spirits cancelled;

Government to discuss setting up investment zones with 38 local areas in England.

Alongside the above, the Chancellor announced plans to remove environmental safeguards for building developments and reduce the regulatory burden on financial institutions.

KWARTENG LEAVES LABOUR AN OPEN GOAL

In an interview with Rishi Sunak during the Conservative leadership contest, Nick Robinson observed that it would be a nasty surprise for the former Chancellor when he found out who’d been in power for the last twelve years.

Kwasi Kwarteng followed Liz Truss’s preferred method of operation: he pretended they hadn’t happened.

The Chancellor comprehensively dumped on the policies pursued over the last dozen years by successive Conservative governments, for a decade of which Liz Truss has been a member.

His statement was, as one ministerial colleague said, “a game changer”, although perhaps not in the way he envisaged.

So complete was the change of economic policy that it leaves an open question about how Mr Kwarteng and his Cabinet colleagues ended up in the same political party as most of their backbench colleagues and served under the last three Conservative leaders.

Shadow Chancellor Rachel Reeves did not miss the open goal. Even as Mr Kwarteng and Ms Truss shook their heads on the government benches, she hammered home that the Chancellor’s statement was an admission the record of Conservative governments since 2010 was one of a failure to deliver growth or a viable economic plan.

THE SUPPLY SIDE FIX

The Chancellor and Prime Minister’s rationale is that cutting taxes for the already well-off will benefit all citizens as they are incentivised to invest and act in entrepreneurial ways. In addition, reducing regulation for businesses will encourage increased commercial enterprise.

They believe the growth stimulated will make up for any loss in tax revenues as increased economic activity, encouraged by lower taxes, leads to increased government revenues.

That approach is called supply-side economics, which focuses on increasing the supply of goods and services through growth.

In every developed nation where the Government’s brand of economics has been tried, two things have happened: a cataclysmic bust has followed a short-term burst of economic activity.

In addition, wealth inequalities – and the UK is already grossly unequal – are embedded and made worse.

Low taxes on the wealthiest do not distinguish between those who generate wealth through their industry or create economic activity through business investment and those who inherit wealth or sit on capital without producing anything.

“THE RICH WILL REJOICE”

Wales’s Finance Minister, Rebecca Evans MS, responded: “Rebecca Evans, Minister for Finance and Local Government, said: “Instead of delivering meaningful, targeted support to those who need help the most, the Chancellor prioritises funding for tax cuts for the rich, unlimited bonuses for bankers, and protecting the profits of big energy companies.

“Instead of increasing funding for public services in line with inflation, we get a Chancellor blithely ignoring stretched budgets as public services find their money is not going as far as it did before.”

Plaid Regional MS Cefin Campbell said: “This Budget will see the rich rejoice as their bonuses rocket and their tax bill sliced, once again it will be the poorest and most vulnerable bearing the brunt of the disastrous cost of living crisis.”

 Plaid Cymru’s Treasury spokesperson, Ben Lake MP, added: “Tax cuts for the super-rich will do absolutely nothing to drive growth in the Welsh economy.

“I urge the UK Government to recognise that our Government in Wales must be given the fiscal tools to unlock our economic potential ourselves. That is the only way to improve the lives of people across Wales.”

Welsh Conservative Shadow Minister for Finance, Peter Fox MS, said: “Today shows that the UK Conservative Government has a comprehensive plan to provide a sharp boost to the economy by putting cash back into people’s pockets. Labour in Wales has the power to cut taxes in Wales but chooses not to.

“Mark Drakeford needs to take a leaf out of Liz Truss’ book and take immediate action to support hard-working people and struggling businesses, stimulating the Welsh economy rather than stifling it.”

Scott Corfe, Research Director at Social Market Foundation, said: “The Chancellor is taking a very high-risk gamble with the economy.

“If his package of enormous tax cuts and ‘supply side reforms’ fails to translate into significantly higher economic growth, we risk further falls in the pound and surging gilt yields as investors lose confidence in our ability to pay our way in the world.

“That, in turn, means higher inflation, an unsustainable trajectory for the public finances and steeper interest rate rises – potentially deepening rather than alleviating the cost of living crisis.”

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Liz Truss confirmed as the new Prime Minister

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LIZ TRUSS was confirmed as the new leader of the Conservative Party on Monday, September 5.

The widely-tipped victory saw Ms Truss capture 80,000 out of 140,000 votes from Conservative members.

Her margin of victory, 57% to 43%, is comfortable but nowhere near the levels suggested earlier in the campaign.

In her first speech, she claimed she would fulfil the pledges made in the Party’s 2019 election manifesto and praised her predecessor, the disgraced Boris Johnson, for getting Brexit done.

“Leave cannot name one country we would get a better trade deal with if we left the EU.”

At least Liz Truss’s six-year-old prediction about the benefits of Brexit came true.

It also highlights her remarkable capacity to rewrite her past and her fellow Conservatives’ collective amnesia about her.

Liz Truss comes from a comfortable middle-class background.

Her father is an emeritus professor of pure mathematics at the University of Leeds, while her mother was a nurse, teacher, and member of the Campaign for Nuclear Disarmament.

Liz Truss describes her parents as “to the left of Labour.”

She attended the highly-rated Roundhay School in one of Leeds’s more pleasant suburbs. She went to Oxford University to study Politics, Philosophy, and Economics.

She graduated in 1996.

During her time at University, she became President of its Liberal Democrat Society and, in 1994, spoke in favour of the monarchy’s abolition at the Party’s national conference and supported the legalisation of cannabis.

After graduating in 1996, she joined the Conservative Party and promoted the value of mathematics teaching to all students in full-time education.

After entering Parliament in 2010, in 2012, she became a junior minister in David Cameron’s government.

After making an impact in her role in the Department of Education, she got a big promotion to the position of Environment Secretary. In that role, she accepted climate change was happening and promoted the end of pesticides that harmed bee populations.

She reversed her positions within a year, backing the lifting of a ban on such pesticides and ending subsidies supporting the extension of solar energy.

During the Referendum campaign of 2016, she was an ardent Remainer, saying: “I am backing remain as I believe it is in Britain’s economic interest and means we can focus on vital economic and social reform at home.”

She also said: “After the 2016 Referendum, she underwent a dramatic conversion to become an ardent Brexiteer – again blown by the prevailing wind in a direction that would further her career ambitions.”

As a disastrous Justice Secretary, she undermined the independence of the judiciary and oversaw a large increase in violence in prisons.

As a reward, she was shunted to the position of Chief Secretary to the Treasury. After backing Boris Johnson in 2019, she became International Trade Secretary. During that time, she signed trade agreements with the UK’s trading partners on strikingly worse terms than the UK had during its EU membership. She also became the UK’s chief negotiator with the EU and rapidly ran those negotiations into the sand.

From radical Liberal Democrat to right-wing Conservative; from ardent Remainer to enthusiastic Brexiteer; the only constants in Liz Truss’s political views have been her views on individual liberty and the pursuit of career advancement.

A strong supporter of David Cameron; a stalwart of Theresa May’s cabinet; a fervent early adopter of the Boris Johnson cult; Liz Truss will be the UK’s fourth Prime Minister in six years and the third in a row who has risen to the post without facing a General Election.

Her inbox would be extraordinarily challenging, even for someone widely regarded as almost as intellectually negligible and facile as her predecessor.

Liz Truss doesn’t have time to build a brand or establish her authority.

She must hit the ground running with fresh ideas to tackle the UK’s massive economic challenges, the fallout from a shambolic Brexit deal agreed by her predecessor, the cost-of-living crisis, the energy crisis, spiralling inflation, the possibility of a recession, Russia’s war in Ukraine, and delivering all the promises on tax cuts she made during the leadership campaign.

Most importantly, she must signal a clear break with the sleaze, patronage, and low standards of public life that forced Boris Johnson and compelled almost his entire ministerial team to quit when the stench of scandal became too much for them.

Against that background, survival to 2024 and beyond will be a massive achievement.

POLITICAL VOICES FROM WALES ON NEW PM

Welsh Conservative leader Andrew RT Davies MS said: “I am delighted that Liz has been elected party leader and will be our next Prime Minister, especially having backed her during the contest.

“Throughout her political career and this contest, we have seen someone with the tenacity, ideas, and stoicism required to lead the Conservatives into the next election and the country through a difficult period.

“There is a lot of work to be getting on with, especially in tackling the cost-of-living crisis, and I look forward to seeing Liz’s ideas put into action to alleviate the struggle millions are facing.

“It is now time to unite behind our new leader, and further build on our record of delivering for Wales and the wider United Kingdom.”

Predictably, Labour in Wales are not happy.

Labour’s Shadow Secretary of State for Wales Jo Stevens told this newspaper: “Liz Truss has her fingerprints all over the crime scene of the past 12 years of Tory failure. She reliably parroted Boris Johnson’s lies and voted for the 15 tax rises the Tories have imposed in the last two years. At every turn, she’s shown people she can’t be trusted.

“Households right across Wales needed action from the Tory Government to tackle their cost of living catastrophe months ago. Nearly nine weeks on from the start of her leadership campaign, Truss still has no plan and no ideas to address the crisis people and businesses are dealing with.”

Carmarthen West and South Pembrokeshire MS Samuel Kurtz has congratulated the country’s next Prime Minister

Commenting on the news, Samuel Kurtz MS told The Herald: “Congratulations to Liz Truss for securing this victory. Whilst I supported Rishi Sunak, the Conservative Party has always had a wealth of talented individuals, and Liz is certainly one.

“The Party must now come together behind our new PM.

“We have some real challenges ahead of us – both abroad and at home – which the incoming Prime Minister must get to grips with. I have faith that Liz Truss has the ability to support the public as we navigate the oncoming winter.

“As we move forward, my priority is ensuring that the communities I represent get the assistance and support they need as we enter these challenging months ahead.

“I’ll be working with my colleagues in Westminster to ensure that support reaches every household in West Wales.”

Welsh Liberal Democrat Leader Jane Dodds MS said: “Under Liz Truss we are set to see more of the chaos that we saw under Boris Johnson. From failing to deal with the cost-of-living emergency, to letting small and medium businesses face the winter alone, to failing to deal with the climate crisis, the Conservatives have shown they don’t care, have no plan and have failed our country.

“The Conservatives may have changed leader, but after twelve years in power at Westminster the Conservatives have shown they are out of ideas, out of energy and out of touch. 

“First the government needs to urgently scrap October’s energy price rise to avoid a social catastrophe for families and pensioners this winter. Then we need a general election, to get the Conservatives out of power and deliver the real change Wales needs.”

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National 20mph limit comes into force in Wales next year

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WALES will be the first UK nation to impose a 20mph default speed limit following a vote held in the Senedd yesterday (July 12). The Welsh Government voted to limit residential roads and busy pedestrian streets to 20mph. 

According to the Welsh Government, this will lessen the likelihood and severity of accidents involving vulnerable road users. It will also encourage more people to cycle and walk. 

39 members of the Senedd voted in favour, while 15 members voted against. 

The new national default speed limit will come into effect from September 2023. The Welsh Government say the changes affect residential roads and busy pedestrian streets. 

According to the Welsh Government, the modifications have an impact on major pedestrian routes and residential roadways. The Welsh Government is still deciding which highways will have 20mph speed restrictions and which ones should stay at 30mph.

The 22 councils in Wales will collaborate with Go Safe to determine implementation timelines, according to the Welsh Government, but enforcement will continue throughout the transition period.

Climate change minister, Julie James, stated: “The future of our towns and cities depends on our ability to move around sustainably and on solutions that have a positive impact on public health environment and communities.

“That is why we will use the principle that walking, cycling and active travel must remain the best options for short urban journeys and a 20mph default speed limit will help achieve this. The introduction of a national 20mph limit would be an important and far reaching policy. If passed Wales would be the first country in the UK to introduce the change. We’re asking you all to be part of this change and make our communities understand the wider benefits of 20mph.

“This change is a generational one and when the time to embed, it will need to be accompanied by an important communication and marketing campaign and behaviour change initiatives. Achieving behavioural change is challenging but Wales has previously shown that we can do it successfully with policies such as organ donation, the banning of smoking in public places, and limiting the use of plastic bags. It does, however, require a collaborative effort between agencies, local authorities and by communities. We need to bring speeds down.”

She continued, saying there is evidence that 20 mph speed limits encourage more people to bike or walk, and she hoped this would lead to people naturally choosing those modes of transportation.

According to Ms. James, 80 people die on Welsh roads on average each year, and current data shows that 30mph is the speed at which 53 percent of accidents occur.

The immediate cost is about £33 million, but according to the Welsh Government, increased road safety brought on by slower average speeds could generate a positive financial return of about £25 million over the course of 30 years due to the money saved on fewer emergency services and hospital visits.

Additionally, the policy might result in significant wider economic gains from increased road safety (£1.4 billion), environmental and health gains from increased active travel (£5 million), and additional unquantified benefits from more vibrant and connected local economies.

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