Kwasi Kwarteng stokes tensions with Sunak amid Net Zero plans

Kwasi Kwarteng stokes tensions with Sunak amid Net Zero plans
Kwasi Kwarteng stokes tensions with Sunak amid Net Zero plans

Kwasi Kwarteng risked stoking tensions with Rishi Sunak today as he insisted tax rises are not 'inevitable' to hit Net Zero targets.

The Business Secretary struck a different tone after a Treasury assessment warned that new levies will be needed to cover the costs of the transition.

He also said he did not 'accept' that subsidies for electric cars were bungs for the wealthy, as the analysis from Mr Sunak's department suggested.

And Mr Kwarteng dismissed 'unhelpful' recent Treasury briefings against him over bailouts for energy-intensive firms.  

The comments, in a round of interviews this morning, come amid signs of increasing friction between Mr Sunak and Boris Johnson's allies.

Alongside the PM's strategy for decarbonising Britain by 2050 yesterday, the Treasury released a stark assessment warning that the government cannot borrow to fund the costs of the transition.

It cautioned that tax rises would be needed to underwrite state investment - and that a way will have to be found to fill the black hole left as £37billion of revenue from fuel duty disappears.

Kwasi Kwarteng

Rishi Sunak

Business Secretary Kwasi Kwarteng (left) struck a different tone after an assessment from Rishi Sunak's (right) Treasury warned that new levies will be needed to cover the costs of the transition

The Treasury cautioned that Net Zero will add to the fiscal pressures the country is already facing

The Treasury cautioned that Net Zero will add to the fiscal pressures the country is already facing

The Net Zero plan sets out a pathway for how various elements need to reduce their carbon emissions over the coming years

The Net Zero plan sets out a pathway for how various elements need to reduce their carbon emissions over the coming years

Fossil fuel production  plans 'well above levels needed to restrict climate change' 

Countries are planning production of oil, coal and gas over the next decade at levels that is 'dangerously' out of sync with targets to curb climate change, the UN has warned.

A report by the UN Environment Programme (Unep) and research institutions found that planned production by fossil fuel-producing countries, including the UK, is 110 per cent above – more than double – the levels that will allow the world to curb temperature rises to 1.5C.

Despite increased climate action and pledges, the fossil fuel production 'gap' between countries' plans and what scientists say is needed to curb dangerous warming has hardly changed since a first report on the issue by the UN in 2019.

The warning comes days before world leaders meet for crucial UN climate talks in Glasgow, where pressure will be on countries to take more ambitious action to keep the 1.5C limit within reach.

Scientists warn that the world is already experiencing worse extremes at 1.2C of warming, and if temperatures go above 1.5C we face significantly more heatwaves, rainstorms, water shortages and drought, greater economic losses and lower crop yields, higher sea levels and greater destruction of coral reefs.

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The message contrasted sharply with the Mr Johnson's bullish comments that there will be no need for 'hair shirt' measures. 

But there are reports it the Treasury assessment was originally even tougher and had been 'scrubbed' to remove the most alarming sections.

Although the government insists that there is no way of predicting the bill for getting to Net Zero, experts have suggested it will be at least a trillion pounds.

That would be far less than the costs of dealing with unmitigated climate change.

However, with the public sector considered likely to foot half that investment it implies an average annual cost of around £15billion - with the rest being picked up by consumers and business. 

In a round of interviews today, Mr Kwarteng admitted making the transition to net-zero can be 'very costly' for consumers.

He told Sky News: 'It's a fine line you have to tread between making the transition and essentially forcing people and imposing costs on people to make the transition, and what we want to do is to keep people with us on the transition, on the journey.'

But Mr Kwarteng denied that tax rises were 'inevitable' due to the Net Zero

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