Insights from Inline Policy listing page
In the run-up to last Thursday’s EU referendum, policy direction, announcements and news flow dried up as the politicians became increasingly consumed with the debate. Following the tumultuous decision taken by the British people, this piece considers the in-tray that the Government - above all, DECC, but in addition other parts of Whitehall - needs to return to on energy and climate matters.
Last week’s Competition and Markets Authority (CMA) set of interim recommendations on the UK retail banking sector represents the culmination of nearly two years work from the new competition regulator analysing plans for structural, market, and anti-trust reform of the industry. It is important to remember the political context which gave rise to the enquiry.
One of the Government’s themes for the Queen’s Speech for the 2016-17 Parliamentary session is improving life chances for the British people. Through the measures on the digital economy, transport and infrastructure, the Government’s intention is to make long-term social and economic reforms the focus of the remainder of this Parliament. Whether in practice that will happen with the aftermath of the European Referendum likely to hang over UK politics for several years, and darkening economic stormclouds gathering over the economy in terms of weaker performance on growth, exports, the current account deficit and productivity, remains to be seen.
One of the key policy responses to the financial crisis which led to the Great Recession was the subsequent action taken by EU Heads of Government through the European Council in June 2009 to strengthen the regulatory system governing all financial services providers within the Single Market area. In establishing a new European Banking Authority (EBA), within a European System of Financial Supervisors, which could take decisions on the basis of majority voting, member states also adopted a trio of regulations applicable throughout the Single Market – known together as the Single Rulebook.
In most parts of the world, the Millennial Generation has more personal and economic freedom than any which preceded it, but is also facing a squeeze on wealth and assets not experienced in the last 70 years. The UK Government’s Social Mobility and Child Poverty Commission considers that social mobility is in danger of going into reverse in some areas of the UK, and that inequality of assets between generations could worsen matters.
Referendums are transformative events. Governments may come and go, but a decision to stay in or leave an economic union like the EU is an irrevocable judgement on the nation’s destiny – the most important decision in the lifetimes of voters in the UK. The implications will affect everything from the regulation of the air we breathe to the pensions we invest in. For the financial services sector, the general investment climate in the UK, as well as the contours of central bank policy on the equity banks must retain as capital buffers will be shaped by the outcome on June 23.
2015 was a significant year for climate and energy policy and markets: from the momentous Paris agreement to Obama’s continuing push on the Clean Power Plan; from the new British Government’s fresh (and controversial) energy approach to, at last, some stability for the EU Emissions Trading System (ETS), which may have real implications for the longer-term.
According to recent research by management consultancy A.T. Kearney, the global market for 3D printing is set to grow from $4.5 billion today to $17.2 billion by 2020. With this rapid growth will come added scrutiny from policy makers and regulators. To support its long term growth, and for the industry to fulfil its remarkable potential, a supportive regulatory and policy framework will be critical. To help build this framework, and to put in place policies that will stimulate industry growth and accelerate the uptake of 3D printing technology across the economy, it will be imperative for industry associations to play their part and to engage with key policy makers and regulators.
Politicians have shown they are serious - to achieve a positive outcome, the negotiators need to do the same.
For those not acquainted with the international negotiations on climate change - perhaps even more so for those who have that first-hand experience - they are at best an irritant, at worst a pointless relevance. Since the UNFCCC[1] process began in the early 1990s after the international community agreed that “dangerous” climate change should be addressed, negotiators have gathered year after year in different parts of the world to discuss how the international community can take action to mitigate the climate problem and how the most seriously affected regions (usually in poorer countries) can adapt to the changes brought about by the steady increase in atmospheric and sea temperatures.
The EU Emissions Trading Scheme (ETS), the EU’s flagship climate policy instrument aimed at reducing greenhouse gas emissions at least economic cost and incentivising investment in the low-carbon economy, has been back in the news - for once in a positive sense.
In a speech at the European Parliament plenary debate on Monday 6th July, First Vice-President of the European Commission, Frans Timmermans, said that the Commission “remains strongly committed” to present a circular economy package towards the end of this year. The reasons are quite simple: Vice-President Katainen, Commissioner Vella, Commissioner Bienkowska, and others, essentially believe that the new circular economy package can bring:
The dominant media narrative on climate and energy policy under the Coalition Government had become something of a cliche. The Liberal Democrats were ‘the green heart’; the Tories were ‘arch-advocates of oil and gas’; the Lib Dems, led by Secretary of State Ed Davey, were the ‘champions of disruptive utilities companies’, taking on the power of the Big 6; and the Tories were ‘in the pockets of the big energy companies.’
Research released by the UK Electoral Commission in summer 2014 said that up to 7.5 million eligible people had not yet registered. Despite a major “use your vote” drive in recent weeks as the election campaign has swung into action, there will probably still be millions of voters who have effectively disenfranchised themselves from going to the ballot box on 7 May. The Commission has also estimated that, in the 2010 election, only 44% of 18-24 year-olds voted. So it would be fair to conclude that that there will be many young people who won’t vote on 7 May - a shame when, for most of them, it will have been their first opportunity to exercise their democratic prerogative.
With only 17 days until the UK General election, the two main parties remain deadlocked in the polls, which have moved little since the start of the campaign. The Conservatives’ strong lead on the economy and on leadership, has not been accompanied by enough of a detoxification of their party brand to pull ahead. The Labour Party is more trusted on its values and motives, but the public remains wary of its capacity to govern. The static nature of the polls has extended to the insurgent fringe and nationalist parties’, whose respective bubbles are yet to burst. These parties remain likely to have a considerable impact north of the border and in marginal seats across the UK.
Energy and environmental policies have been a regular talking-point during the period in office of this coalition government. Most of the public will have heard of David Cameron’s ambition that his should be the “greenest government ever”, while few speeches from Ed Miliband have grabbed the spotlight in the manner his “price freeze" party conference speech did in September 2013. Subjects which used to live in the world of policy and markets wonks - the link between wholesale and retail prices, the impact of energy efficiency measures, the cost of renewables, Russian gas pipelines, not to mention the controversies generated by fracking - have become almost mainstream topics.
