The UK risks losing out to the US and EU in the global race to a net zero economy unless the government increases green investment by taking a stake in the companies of the future, a thinktank has said.
The left-leaning Institute for Public Policy Research said Britain needed a “national investment fund” (NIF) that would back new firms and secure a share of any future profits for the public as it called for the state to adopt a “Dragons’ Den” type approach to supporting enterprises.
The IPPR said the UK needed its own version of Joe Biden’s Inflation Reduction Act – which offers US federal government subsidies to support clean energy, infrastructure and green jobs – and the EU’s proposed green deal industrial plan.
Simone Gasperin, an associate fellow at the IPPR, said: “The national investment fund is a policy proposal for our time. The UK needs to finance and coordinate strategic industrial policy projects that will deliver a net zero transition through economic prosperity and inclusion.
“The cost of inaction on people’s livelihoods will be too high, while there are huge opportunities to be captured by the government co-investing with private companies.”
Under the thinktank’s proposal, the NIF would provide finance for investment in the green industrial sector, with the aim of encouraging private companies to make investments they might otherwise be reluctant to make. The IPPR said the plan would strengthen the UK’s manufacturing sector and help level up the economy.
Governments of left and right have been reluctant to back the idea of the state taking a strategic stake in private firms since the 1970s. The National Enterprise Board created by the Labour government in 1975 ended up primarily concerned with keeping loss-making firms afloat and generated a longstanding aversion in Whitehall to “picking winners”.
Keir Starmer has vowed to launch a publicly owned clean energy company, which may invest in emerging technologies, in its first year of government if Labour gains power.
The IPPR said it was important to revive the idea of an active, modern industrial strategy.
Initial funding to the NIF would be provided by the Treasury, but it would be further supported by tax revenues from North Sea gas and oil, or by levies which the thinktank said should be imposed on share dividends and “buybacks”. This would divert excess profits from fossil fuel activities into productive investments in a future green economy, it added.
In exchange for the financial backing, the state would become a part-owner of the business and share in its success and future profits. The IPPR said this would be analogous to the sort of investment provided to budding entrepreneurs by tycoons in the Dragons’ Den BBC TV series.
In its report, the thinktank said that “in the global green race to reap the benefits of the transition to a net zero economy, the UK is at severe risk of being left behind. While other countries recognise the need for green investment and industrial policy, the UK government is sitting on the sidelines.”
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in the technology and base meta sectors, while U.S. stock markets also climbed higher.
The S&P/TSX composite index was up 106.70 points at 24,179.21.
In New York, the Dow Jones industrial average was up 280.87 points at 42,361.24. The S&P 500 index was up 26.51 points at 5,777.64, while the Nasdaq composite was up 69.52 points at 18,252.44.
The Canadian dollar traded for 73.08 cents US compared with 73.22 cents US on Tuesday.
The November crude oil contract was down 67 cents at US$72.90 per barrel and the November natural gas contract was down eight cents at US$2.66 per mmBTU.
The December gold contract was down US$2.30 at US$2,633.10 an ounce and the December copper contract was down five cents at US$4.41 a pound.
This report by The Canadian Press was first published Oct. 9, 2024.
