Watchdog warning

Scotland must spend more to hit net zero target

Ballater flood youtube
Flooding, like this in Ballater in 2016, could become more commonplace

Scotland has almost no chance of hitting its net zero target unless it raises investment to almost a fifth of its entire capital budget, according to a financial watchdog.

The Scottish Fiscal Commission (SFC) warned that unless it finds the additional funding it will face an even bigger bill for dealing with the impact of climate change, such as flooding.

The SFC estimates that an extra £35 billion is needed from the public purse to fund environmental plans in devolved areas such as buildings, transport and peatland restoration through to 2050.

A further £5.8bn of funding for Scotland will be required in matters reserved to Westminster such as fuel and electricity supply.

The Scottish government has urged Westminster to provide more funding for important measures like tree planting.

A £1.1bn bill per year relates to the commitment to reach “net-zero” in Scotland by 2045 and for the UK as a whole by 2050.

The SFC said the financial burden may fall disproportionately on the Scottish government because a greater share of the UK’s overall commitments fall to tree planting in Scotland. That equates to £207 per person in Scotland compared with £149 in the rest of the UK.

The commission’s chairman, Prof Graeme Roy, said more information was needed from both governments about their plans for tackling all aspects of climate change.

He added: “Handling not just the achievement of net zero and the future adaptation challenges, but also their fiscal consequences is a shared endeavour that needs to be managed well by both Scottish and UK governments.

“The longer you delay the investment the more costly it becomes.”

Prime Minister Rishi Sunak has already rolled back on some net-zero policies such as postponing the ban on sales of new petrol and diesel cars from 2030 to 2035.

He said the climate change commitments should be met in a “proportionate and pragmatic way”.

Scottish ministers are still considering whether to change their target date for fossil-fuel cars.

Audit Scotland has previously described plans to tackle the impacts of climate change as “vague” and the Climate Change Committee said Scotland had lost its lead over the rest of the UK on tackling the issue.

Scotland’s Net Zero Secretary Mairi McAllan said: “We are grateful to the SFC for this report. As it states, Scottish and UK net zero targets are intertwined. And in particular, UK targets rely on reforms to forestry and land use – a greater share of which has to take place in Scotland. 

Mairi McAllan
Mairi McAllan: the UK government must stop shirking its responsibility (pic: Terry Murden)

“Achieving Net Zero is an environmental imperative and our moral obligation, as 2023 is confirmed the hottest year on record and as the impacts of climate change are acutely felt around the world, and here at home in Scotland. However, done correctly, achieving net zero is also a significant economic opportunity for Scotland.

“In 2024-25 alone we are committing £4.7 billion in capital and resource for activities that will have a positively impact on delivery of our climate change goals. However, delivering the infrastructure required to meet our net zero will also require responsible investment by the private sector and – crucially – the UK Government who needs to stop shirking their responsibility and invest.

“That’s why it is deeply concerning that we are expecting a real-terms cut to our UK capital funding of 8.7 per cent over five years, totalling around £1.3 billion.

“Our calls for the Spring Budget to address this went unanswered, with no additional capital funding in 2024-25. This comes on top of the UK Government reneging on its net zero commitments, and rolling back policies already announced and accounted for.

“We will continue to call on the UK Government to change course, and ensure future financial settlements provide us with the resources we need to secure a just and fair transition to net zero.”

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