Treasury limbering up for return to normal

7th Jun 2021


Last week we saw COVID recovery in education thrust into the spotlight. An independent report, commissioned by the Prime Minister, advocated a financial commitment of £15 billion (relatively small beer in the light of costs incurred to date) but the Treasury only allocated a tenth of this sum. The advisor duly resigned. Political row ignites.

This matters, not just to education but to our sector too. The Treasury is resuming its long-established role of saying no to public expenditure. We will soon have the mantra of tightening belts across Whitehall. Somehow, the costs of COVID have to be met.

So why does this matter? Well EUA have been asking the public what they think about net zero in the home. The results are interesting, relevant and will be released next week. But as a taster, overwhelmingly the public back measures to tackle fuel poverty ahead of achieving Net Zero, despite widespread support for the latter. The Committee on Fuel Poverty put that bill at £18 billion. Achieving Net Zero domestic heating, well that comes in around £500 billion. The Treasury will simply not commit to this sum, end of. So consumers are going to have to put their hands into their pockets.

This is where political interest is starting to grow. Senior government backbenchers are already starting to ask awkward questions about costs. It won’t be long before this gathers pace as I suspect they have hit a raw nerve. The government simply can’t afford to pay all the costs of reaching Net Zero (and their money is our money) and the consumer doesn’t want to pay, even though they support the aim.

It isn’t a great position to be in, so any major decisions will no doubt get kicked down the road. That’s how things tend to be done in government. Who wants to be cast as being “a brave Minister” when the public aren’t ready to move? And if you think that shouldn’t matter, here’s a finding from our survey: - 40 per cent of consumers would be less likely to vote for government that increased the price of gas to encourage a switch to heat pumps. That’s a figure all politicians, not just the Treasury, look at.

Best wishes,

Mike Foster, CEO