The 1980’s may be four decades ago, but the political decision-making of the period still holds a central position in setting British policy priorities of today – none more so than in the area of industrial strategy. In 1981following the Toxteth riots Sir Geoffrey Howe, then Chancellor, suggested regenerating Liverpool would be like “trying to make water flow uphill”, and that a policy of “managed decline” should be adopted. The phrase symbolised the deindustrialisation that swept through many communities during the 1980s
In the present day, the policy direction continues to shape thinking. In one of her first comments as Secretary of State for Energy Security and Net Zero, Miatta Fahnbulleh set out plans to reverse the “disastrous legacy of 1980s deindustrialisation.”
While the Government is still highly focused on renewable energy development, the comments speak to a wider trend – and priority – for one of the departments set to play a pivotal role in delivering ‘Burnhamism’.
Ending ‘Managed Decline’
The narrative and messaging coming out of DESNZ since Andy Burnham entered Downing Street has a distinctively industrial flavour. When Fahnbulleh’s predecessor, Ed Miliband, was appointed, he entered a political and social climate where ‘net zero’ was firmly ingrained in the British political zeitgeist. Two years later, however, net zero has come under increased scrutiny, and its palatability amongst the public is being increasingly questioned.
Studies – including our own polling – show that the term ‘net zero’ is becoming politically difficult. For instance, a new study from King’s College London has revealed a gradual decline in public support for net zero policies.
It is therefore unsurprising DESNZ has chosen to change tack on the language being used. While Burnham’s ascension to Prime Minister has resulted in a bounce in the polls, he will still be aware of the threat Reform poses to current, Labour-held, constituencies (especially traditional Labour red-wall seats spanning much of the Midlands and the North).
Recent General and Local Elections have demonstrated the wall is not as red as once thought. These constituencies believe they have not only suffered a policy of ‘managed decline’ from Thatcher, but a long list of governments of all colours, who have neglected and abandoned them – concentrating on the bright lights of the South-East.
Putting Jobs at the Heart of Net Zero
Fahnbulleh’s emphasis on reindustrialisation therefore ties in rather nicely with Burnham’s agenda of devolution to the regions. DESNZ recently confirmed their list of Ministerial roles and responsibilities, including two notable additions – a dedicated Minister for Reindustrialisation, and a Minister for Local Energy and Jobs.
Whilst net zero and the deployment of renewable energy at scale are undoubtedly pillars of the national policy agenda, there is now codified recognition that the communities in which much of this infrastructure is constructed should also benefit from its presence. It is precisely the communities who feel abandoned by government that will be targeted in this new drive. Fahnbulleh will seek to take these communities on the journey to energy security, demonstrating how it can support both national agenda and local priorities simultaneously.
What does this mean for developers?
Major projects are complex at the best of times, and trying to demonstrate how a project can benefit local communities is only one part of the process. Nonetheless, it is now as important as ever for developers to make the case for how their projects support local reindustrialisation, to building support with the Secretary of State.
Expect the distribution of community benefit funds to play a key part. Fahnbulleh sees an intrinsic link between the renewable energy sector and economic growth, and new DESNZ priorities present an opportunity for developers to put this money to work.
Working with local communities to tap into regional priorities and necessities, there is the chance to develop apprenticeship schemes and upskilling opportunities which leave a legacy long after the project has received development consent.
Applications which demonstrate how they will aid reindustrialisation and drive local employment may now be looked on more favourably. Developers should expect future applications to face greater scrutiny not only on local environmental impacts, but also on their ability to demonstrate tangible, local economic and community benefits. Expect scrutiny around where workforces will be drawn from and what supply chains and suppliers have been identified to construct, maintain and operate the project.
For developers, the message is increasingly clear: supporting net zero may no longer be enough. Projects will need to increasingly demonstrate how they create skilled jobs, strengthen local supply chains and contribute to regional growth are likely to find a more receptive audience within this new-look DESNZ.