Late last year, the Environmental Audit Committee (EAC) of the House of Commons launched an inquiry on 'Sustainability and HM Treasury'. This follows work done by the previous Committee investigating Sustainability and the Department for Business, Innovation and Skills (BIS), the Home Office, and the NHS.
Earlier in 2015 the EAC commissioned a report from the National Audit Office, looking at the extent to which the Spending Review process allows the Government to make well-informed decisions in respect of the environment and sustainable development. This report will be published in the summer and its findings will be considered by the committee as part of this inquiry.
To further inform the Committee's investigations, they launched a call for written evidence on a range of questions in December. As an Institution with sustainable development firmly embedded in our aims and values, the IES submitted evidence to this inquiry.
The key points of our submission are:
- There are enormous opportunities for policy makers to improve economic and environmental outcomes simultaneously, but the evidence of some recent decision-making suggests the Government is failing to capitalise on this opportunity.
- It is encouraging that the Treasury is considering its role in promoting sustainability. We welcome recent decisions to protect the Science Budget, and fund ambitious interdisciplinary research which will tackle Global Challenges. We would welcome similar leadership from HM Treasury in delivering on the Sustainable Development Goals, where at present a coordinated government strategy is not apparent.
- A systems approach to policy or programme appraisals, which recognises the complex inter-connections between environmental, social and economic variables would lead to a fuller and more nuanced appreciation of the impacts policies will have on socio-environmental systems over time, as well as on local, regional and national economies.
- The use of wellbeing indicators (such as that which has been developed by the Office for National Statistics) in policy analysis and development could complement economic metrics and assist the Treasury in its mission to deliver sustainable growth.
- The sustainability agenda should not just be conceptualised as a drain on the public purse. In fact, green business is an innovative, productive and fast growing contributor to the UK economy.
On the 17th November, the EAC published their report on Sustainability and HM Treasury. The report calls for the Treasury to "green-check" all its decisions after their inquiry found that currently, its approach puts short term priorities over long term sustainability – potentially increasing costs to the economy in the future, and harming investor confidence. The IES strongly supports this recommendation, which reflects calls in our own evidence to the inquiry.
In its report, the committee presents two key case studies which it feels demonstrate the current failures of the Treasury to account for the long term costs of environmental problems, and the potential benefits of investing in green technologies and initiatives. We are pleased that the Government's decision to cancel a major Carbon Capture and Storage demonstrator competition, months before completion, an example highlighted in the evidence submitted to the inquiry by the IES and other organisations was highlighted as one of these case studies. This decision failed to recognise the need to invest in CCS technology now, to avoid much greater costs associated with unmitigated climate change in the future, and we applaud the committee's work in calling for a more sustainable, long-term approach.