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Bright Blue, the independent think tank for liberal conservatism, has today published a new report entitled Greening UK Export Finance, which sets out how the UK’s export credit agency (ECA), UK Export Finance (UKEF), can be brought into full alignment with the Paris Agreement and motivate other countries to follow suit.

The report applies an original assessment methodology by Climate Perspectives Group to comprehensively assess the alignment of UKEF with the Paris Agreement. The methodology assesses climate performance of Export Credit Agencies (ECAs) across five weighted dimensions.

ECAs are given one out of four overall labels and an overall score, based on the extent of their alignment: unaligned (score = 0.00/3.00), some progress (score = 1.00/3.00), Paris aligned (score = 2.00/3.00), or transformational (score = 3.00/3.00).

This score is based on five dimensions, which are differently weighted:

1. Transparency. Financial and non-financial disclosures. Weighted 20%. 
2. Mitigation I. Ambition of fossil fuel exclusion or restriction policies. Weighted 40%.
3. Mitigation II. Climate impact of and emission reduction targets for all activities. Weighted 20%. 
4. Climate finance. Positive contribution to the global climate transition. Weighted 10%.
5. Engagement. Outreach and ‘pro-activeness’ of the ECA and its governments.  Weighted 10%.

The report finds in its assessment of UKEF according to the five dimensions:

1. Transparency – 1.25/3.00
2. Mitigation I – 1.33/3.00
3. Mitigation II – 0.67/3.00
4. Climate finance – 0.80/3.00
5. Engagement – 2.33/3.00

Assessment outcome: Some progress (1.23/3.00)

This is most notably due to stopping official export finance support for fossil fuels (coal, oil and gas, with limited exceptions) in overseas businesses in 2021, other commitments made under UKEF’s Climate Change Strategy, as well as the UK’s recent engagement at COP26. 

Compared to other countries, the UK performs relatively well. The four other countries – Canada, Germany, Japan and the Netherlands – assessed by Perspectives Climate Research were all rated ‘Unaligned’ with the Paris Agreement.

Our polling of a reflective sample of 750 UK exporting firms, designed and conducted in partnership with Opinium, found:

• A clear majority of all UK exporters would like for UKEF to be an important force for promoting low-carbon exports globally (73%) and providing more generous financing terms to exporting firms that help to address climate change (73%)
• The majority of all UK exporters support: UKEF assisting exporting firms with preparation for and adaptation to climate-related risks (72%); prioritising job creation within the low-carbon and renewable energy sector over protecting employment in the oil and gas sectors (71%); and, leading among other ECAs on efforts to combat climate change (70%).
• A majority of all UK exporting firms (83%) favour UKEF providing better financing terms for exports of low-carbon goods and services.
• A majority of UK exporting firms (62%) state that UKEF should provide worse financing terms for exports of high-carbon goods and services.

Ryan Shorthouse, Chief Executive of Bright Blue, commented:

“The cost of living crisis, caused by the sharp increase in the global wholesale price of energy and exacerbated by the justified international response to the Russian invasion of Ukraine, shows why the UK and our allies across the developed world must work towards fully phasing out taxpayer support for international fossil fuel projects, and gas in particular, and cultivate green energy markets. 

“As the UK still holds the COP Presidency until COP27 in Egypt later this year, there is an opportunity for the UK to continue to show bold global leadership on climate change by bringing UKEF into full alignment with the Paris Agreement, and encouraging other countries to do the same with their own Export Credit Agencies.”

Igor Shishlov, Senior Consultant for Perspectives Climate Research, commented:

“The latest climate science unequivocally points to the need to leave most of the known fossil fuel reserves in the ground. In this light, export credit agencies as public finance institutions must reflect climate commitments of their governments and fully phase out support to fossil fuels, including natural gas, and ramp up support to renewable energy. 

“The ongoing energy crisis exacerbated by the war in Ukraine clearly demonstrates that the UK must double down on the clean energy transition for the sake of the environment, energy security and employment. The UK must also use its ongoing COP Presidency to rally other countries to follow suit and speed up the alignment of all public finance with the Paris Agreement.”

UKEF has made significant improvements in the past few years to reduce its contribution to climate change, including the decisive and welcome step made last year to end most support for the development of fossil fuel export projects overseas. Despite this, UKEF is not yet fully in line with the Paris Agreement. The report proposes ten new policies by which the UK can achieve full alignment of its export finance with the Paris Agreement and become the leading model ECA worldwide.

Transparency

• Recommendation one: Adopt the best international GHG accounting system for all scope 1-3 emissions. At the moment, UKEF does not operate a greenhouse gas (GHG) accounting system. But in its Climate Strategy, UKEF has already committed to implement a Scope 1-3 GHG accounting system. Using a reliable GHG accounting system is crucial to ensure progress towards GHG emissions reduction targets and improve transparency with regards to climate-related disclosures.

• Recommendation two: Disclose climate-friendly and climate-adverse financing across all of UKEF’s portfolio Currently, UKEF operates no dedicated climate-related financial reporting and it is therefore not possible to determine climate-positive or climate-adverse finance as share of neither new nor outstanding commitments. UKEF can use and build on the EU Taxonomy for Sustainable Activities, considering the latest scientific advances. This would require, for example, UKEF to clarify an exhaustive list of eligible activities under its ‘clean growth’ sectors, which should be based on sector-specific thresholds of the specific economic activity, such as proposed by the EU Taxonomy for Sustainable Activities.

• Recommendation three: Further enhance Task Force on Climate-Related Financial Disclosures (TCFD) reporting by providing quantitative indicators on GHG emissions. Currently, UKEF only reports qualitative information without quantitative indicators on GHG emissions, GHG emissions intensity, emissions reduction targets, and exposure to fossil fuel assets. While within its Climate Change Strategy UKEF committed to provide the first quantitative disclosure in its second TCFD report for 2021-22, what exact quantitative information would be provided is unclear. We recommend that UKEF clarifies this and reports in its second TCFD report the following quantitative data, as a minimum: new and cumulative outstanding commitments related to fossil fuels; new and cumulative outstanding commitments related to clean energy; scope 1, 2, 3 GHG emissions once they become available; and GHG emissions reduction targets by sector.

• Recommendation four: Incorporate Taskforce on Nature-related Disclosures (TNFD) for UKEF projects once they become available. We recommend that UKEF considers the developments under the Taskforce on Nature-related Disclosures (TNFD), which aims to provide recommendations for financial institutions to report and act on nature-related risks and opportunities. We recommend that UKEF evaluates the possibility of further extending disclosures to incorporate TNFD recommendations once they become available.
  

Mitigation I

• Recommendation five: Adopt a value-chain approach to stop UKEF supporting fossil fuel projects, directly or indirectly. Loopholes that may allow some fossil fuel projects to get export finance support from UKEF still remain. We recommend implementing a full phase out of support for fossil fuels including upstream – such as extraction – and downstream – such as conversion into petrochemical products. This will allow us to consider instances where fossil or renewable energy activities are also supported indirectly. Currently, UKEF does not operate a fossil fuel and/or clean energy reporting methodology.

• Recommendation six: Exclude all natural gas projects from future UKEF support. UKEF conveys the image of natural gas as a ‘transition fuel’, but the ‘Net Zero Pathway’ by the International Energy Agency states that the new investments into natural gas are not compatible with the special responsibilities of early industrialised countries. We therefore recommend a careful revision of the existing loopholes on fossil fuel financing, with a view to fully phasing out export finance support to all fossil fuel value chains, including natural gas in particular.
  

Mitigation II

• Recommendation seven: Adopt new Science Based Target Initiative (SBTi)-approved decarbonisation pathways and targets for all economic sectors which include projects supported by UKEF. UKEF should work closely with – and ultimately get approval from – the Science Based Target Initiative (SBTi), to develop clear decarbonisation pathways and targets for all economic sectors which include projects supported by UKEF, ideally based on the regularly updated and declining annual carbon budgets set by the UK’s Climate Change Committee (CCC).
  

Climate finance

• Recommendation eight: Set new targets for UKEF: a) a year-on-year increase for the proportion of climate-friendly financing across all of UKEF’s portfolio, and b) that half of all financing will be climate-friendly as soon as possible. This can be achieved more easily with a robust and transparent reporting system, as outlined in recommendation two. We would also recommend a target of 50% climate-friendly finance over the total portfolio in the short run, in line with the most ambitious targets by the multilateral development banks.

• Recommendation nine: Introduce a climate-reward system for exporters for UKEF financing, such as smaller premium or interest payments. We recommend devising and implementing an effective climate-reward system across UKEF’s entire portfolio. This could include enabling smaller premium or interest payments for projects that meet UKEF´s ‘clean growth’ eligibility, or other robust climate-friendly activities. This would create an additional incentive for UK exporters of clean technologies.

Engagement

• Recommendation ten: The UK should build on COP26 momentum to expand the Statement on International Public Support for the Clean Energy Transition and the OECD Arrangement to include phasing out fossil fuel support and closing remaining loopholes. The UK should build on the success of its COP Presidency so far by engaging in both multilateral fora – such as the OECD – and in bilateral exchanges – for example, with China – to further advance a decarbonisation of the global export finance system. An enhanced international commitment to phase out public support for all fossil fuel projects is needed, and the UK needs to take the lead internationally. By the UK demonstrating a full phase out is possible, it can be an example and support other countries to implement full phase-outs of their own, without any loopholes, of all types of fossil fuel projects supported by export finance. 

ENDS

Notes to editors:

To arrange an interview with a Bright Blue spokesperson or for further media enquiries, please contact Joseph Silke at joseph@brightblue.org.uk or on 07948 420 584.

• Bright Blue’s new report is entitled Greening UK Export Finance. The report is kindly supported by the European Climate Foundation. However, Bright Blue retains complete editorial control over the report. The views in the report do not necessarily reflect the views of the sponsor.
• The figures, unless otherwise stated, are from Opinium. Total sample was a broadly reflective sample of 750 senior decision makers at UK exporters. Polling was conducted between 12th and 15th November 2020.
• Perspectives Climate Group is a consultancy specialising in climate and sustainability services based in Germany.

For further comment or to arrange an interview please get in touch with Joseph Silke: joseph@brightblue.org.uk or 07948 420 584. 

Commenting on the Spring Statement, Ryan Shorthouse, Chief Executive of Bright Blue, said:

“This is the confused Chancellor. He is desperate to burnish his Hayekian credentials to his colleagues, but he has been consistently Keynesian in his response to two major crises during his short tenure, using a mixture of public spending and now tax cuts to stimulate the economy through troubled times. Public debt, tax levels and inflation will remain historically very high for the foreseeable future, much higher than what fiscally hawkish economists would advise. 

“The fairest way of helping households struggling with a range of costs, especially fuel and energy, is through broad subsidies such as Universal Credit or broad taxes such as VAT, National insurance or Income Tax. The Chancellor should be applauded for introducing the most targeted tax cut he could: increasing the starting salary threshold for employees and the self-employed paying National Insurance and to such an extent it will be aligned with the threshold for Income Tax, a policy which Bright Blue has long called for.

“Since the Chancellor seems to be allergic to welfare, he is hamstringing himself by refusing to do what would help best: increasing the value of benefits such as Universal Credit or the Warm Homes Discount. 

“Using a good chunk of what limited funds he had to help on cutting Fuel Duty is poor policymaking. This is not the second time in twenty years it has been cut, as the Chancellor claimed. Fuel Duty has consistently been cut in real terms since 2011. It is poorly targeted, especially as fewer than half of the poorest 20% of households actually have a car.

“Raising National Insurance, via a new Health and Social Care Levy, and then reducing Income Tax in this Parliament is straightforwardly odd.  Since Income Tax applies to a broader range of income other than work, it means the total tax revenue from earnings is increasing whereas the total revenue on other income – for example, pensions and rent – is reducing. Really, Conservatives should be rewarding work via the tax system.”

The 2022 Spring Statement adopted the following Bright Blue policies:

• Raising the salary threshold for employees and self-employed paying National Insurance
• R&D Tax Credit expanded to include cloud computing and data

Fuel Duty

• The Government will reduce the main rates of petrol and diesel fuel duty by 5p per litre, and other rates proportionately, for 12 months until March 2023.

Sam Robinson, Senior Researcher at Bright Blue, said:

“Today’s cut to Fuel Duty will ease the pain on some households. But it is woefully targeted. Fewer than half of the poorest 20% of households own a car. If the goal is to support struggling households on the lowest incomes, there are far better ways of doing this than cutting Fuel Duty. 

“The Chancellor is wrong to say this is the first time in 20 years that Fuel Duty has been cut. It has already been cut substantially in real terms over the last decade and would have been cut further this year had the Government simply kept the freeze on Fuel Duty in place. There is now a risk that this temporary, and unnecessary, cut becomes permanent and hamstrings progress on net zero.” 

National Insurance

• The Government will increase the annual Primary Threshold and Lower Profits Limit to £12,570 from July 2022

Sam Robinson, Senior Researcher at Bright Blue, said:

“Out of all the tax options available to the Government, raising the starting salary threshold for National Insurance is one of the best. It delivers broad-based benefits that will help low and middle-income households. And it makes the way we tax earnings considerably more logical and coherent. Indeed, Bright Blue has called for raising the Primary Threshold for National Insurance since 2015.

However, the Chancellor missed an opportunity today to improve the design of the new Health and Social Care Levy. Cutting the employer element of the Levy, and broadening it out to include pensions and rental income, would help businesses to ride out the economic storm in the short term, spread the cost of the measure more fairly, and in the longer term feed through into wages and employment.

“An important caveat to the increased National Insurance thresholds is that those on Universal Credit will not capture all of the benefits. Higher thresholds will increase many people’s net income, which will in turn reduce Universal Credit awards.”

Income Tax

• The Government will reduce the basic rate of Income Tax from 20% to 19% from April 2024.

Sam Robinson, Senior Researcher at Bright Blue, said:

“The cut to the basic rate will no doubt grab headlines. But this is a move that, ultimately, mainly benefits better-off households and does little to help those on low incomes. And the Chancellor merely promised to make the cut by 2024. A better approach to addressing the cost-of-living crisis now would have been to focus on unfreezing the starting threshold for basic rate Income Tax to account for higher than expected inflation.

“Cutting Income Tax while raising rates of National Insurance is a confused approach. It will further widen the gap between earned income from work and other forms of income, such as pensions and rental income. And, from a fiscal standpoint, the measures act in opposing directions. While it may not be as flashy as Income Tax reforms, the priority for tax cuts should be National Insurance.”

Benefits

• Additional £500 million for the Household Support Fund from April 2022

Anvar Sarygulov, Senior Research Fellow at Bright Blue, said:

“While benefits are set to be uprated by 3.1% next month, inflation is forecast to peak at over 8% later this year, meaning millions of households on the lowest incomes face a very difficult year ahead, with rising costs of fuel, food and childcare. 

The additional £500 million for the Household Support Fund is both an explicit admission that the social security system is providing inadequate support for those most in need, and a measly sum that does not come close to addressing the gap between rising costs and the falling value of support.

“Bringing forward the next uprating of the benefits forward from April 2023, and increasing the value of the Warm Homes Discount in line with rising energy prices, would have been far more substantive, effective and targeted interventions to keep the value of fiscal support for low-income households in line with rising prices.”

Energy and the environment

• Scrapping 5% VAT on energy saving products and home insulation including solar panels, heat pumps, wind and water turbines 

Rebecca Foster, Energy and Environment Researcher at Bright Blue, said:

“Abolishing VAT for energy saving products and home insulation  for the next five years is a good use of Brexit freedoms which should incentivise further uptake of essential household energy efficiency upgrades. Encompassing wind and water turbines also promotes green energy generation, helping reduce Britain’s exposure to volatile gas imports.

“The Chancellor will be under pressure later this year, at the next Budget just before the next Winter, to do more to support households with energy costs. The best way to help is by uprating the value of the Warm Home Discount offered to low-income households, which has been frozen in value since 2014.”

[Image: Number 10]

Bright Blue, the independent think tank for liberal conservatism, has today published a new report commissioned by its high-profile cross-party, cross-sector Tax Commission, entitled Energising enterprise: reforming business taxes. As the Chancellor prepares to deliver the 2022 Spring Statement this week, the report sets out how to reform the structure of business taxation to increase productivity, incentivise investment, and repair the public finances after Covid-19. 

The report is guided by four principles for reforming business taxation:

• Neutrality. The tax system should preserve a level playing field between businesses of different sizes, different sectors, and different investment strategies. 
• Simplicity. Excess complexity makes the tax system more difficult to administer, opens up more opportunities for tax avoidance, and disproportionately burdens smaller firms. 
• Equity. All things being equal, a shift in the tax system towards economic rent will be progressive as workers and consumers would benefit relative to shareholders. 
• Revenue. Any package of reforms should not worsen the UK’s long-run fiscal position, particularly as the public finances are repaired after the pandemic. 

At this critical moment for the economy, the report proposes 14 new policies to improve business taxation across three areas: reforming Corporation Tax, reforming Business Rates, and reforming business  tax reliefs, with the overall progressive objective of shifting the tax burden away from the normal return on investment and risk-taking and towards economic rent.

Reforming Corporation Tax

• Recommendation one: Move to the full immediate expensing of capital investment in new plants, machinery, and industrial buildings when the investment super-deduction expires in 2023. We estimate that this reform will increase investment by 10.85%, GDP by 4.5%, and wages by £3,200. This would be a significant tax reduction on investment, reducing long-run corporate tax revenues by 0.61% of GDP (or £13.5 billion) on a static basis. However, on a dynamic analysis this fiscal cost would be partially offset by higher tax revenues elsewhere resulting from higher output.

• Recommendation two: Eliminate the bias in favour of debt-financed investment by excluding interest from the corporate tax system. Instead, debt interest payments should no longer be deductible expenses, but interest payments received would not be taxed either. This would increase revenues significantly, offsetting as much as a third (£4.5 billion) of the static cost of moving to a system of full expensing.

• Recommendation three: Allow corporate losses to be carried forward with a factor that adjusts for inflation and a safe rate of return on capital. The 50% annual cap of loss carryforwards should also be eliminated. The impact and cost of this policy is likely to be small in the short-term as interest rates are low, however if interest rates rise in the future a lack of interest factor for losses could have a significant deterrent effect on risk-taking.

• Recommendation four: The UK should lobby internationally for the OECD’s proposed agreement on a 15% global minimum corporate tax to use a cashflow base. This would ensure tax competition would focus on pro-investment and positive-sum reforms to the tax base, as opposed to zero-sum competition on headline rates. It would also dramatically simplify the taxation of cross-border investments.

Reforming Business Rates

• Recommendation five: Business Rates should be replaced with a Business Land Tax levied on commercial landowners, based on unimproved land values. Investments in commercial property improvements would no longer lead to increased tax burdens.

• Recommendation six: To discourage tax motivated shifts from commercial to residential property, a new levy on commercial-to-residential transfers should be introduced. Commercial landlords converting their property would be forced to make up the difference between Business Rates (or Commercial Land Levy) and Council Tax. Payment would be flexible, allowing landlords to pay the discounted value of the tax advantage upfront, or alternatively to pay it annually.
• Recommendation seven: Responsibility over Business Rates reliefs and exemptions for Small Businesses, Charities and Agriculture should be devolved to local authorities. This would mirror local authorities’ existing discretionary powers to top-up Charitable Rate Relief from 80% to 100%. Councils may choose to limit the rate of relief available and retain revenues to spend on local priorities, such as funding business incubators or providing assistance to SMEs operating in co-working spaces.

Reforming business tax reliefs

• Recommendation eight: The Patent Box should be abolished. This would raise at least an estimated £1.8 billion per year from 2023 onwards.

• Recommendation nine: The Film Tax Relief and High End TV Tax Relief should be abolished. This would increase tax revenue by an estimated £0.8 billion.
• Recommendation ten: The Employment Allowance should be phased out over the next five years. This would raise an estimated £2.6 billion. In future, employment support schemes should be targeted more directly at groups with high risk of unemployment, as is the case with the Kickstart scheme.

• Recommendation eleven: Venture capital reliefs such as Enterprise Investment Scheme (EIS), Seed Enterprise Investment Scheme (SEIS) and Venture Capital Trusts (VCTs) should be maintained at current levels and the process for qualifying and accessing these reliefs should be streamlined in line with the Office for Tax Simplification’s proposals. These include administrative changes such as allowing applicants to save partially completed forms online, alongside allowing investors to benefit from the capital gains tax relief in years where they make an income tax loss.

• Recommendation twelve: Social Investment Tax Relief should be preserved, but more resources should be invested in promoting the relief. There is a sound economic rationale to allow investors in social enterprises to benefit from reliefs similar to the venture capital reliefs. However, to ensure the relief’s long-term viability more needs to be done to combat low levels of awareness among accountants and social enterprises, such as targeted information campaigns.

• Recommendation thirteen: The scope of qualifying expenditures for R&D Tax Credit should be expanded to include cloud, data, and User Interface (UI)/User Experience (UX) costs as announced at the 2021 Autumn Budget. This would correct a major bias against the types of research and development used by digital startups.

• Recommendation fourteen: In order to ensure value for public money, HM Treasury should adopt the German model for scrutinising tax reliefs. This would legally mandate biannual reviews of corporate tax reliefs based on a standard evaluative framework including: target accuracy; cost-effectiveness; necessity; and sustainability.

Ryan Shorthouse, Chief Executive of Bright Blue, commented:

“There is a Byzantine system of business tax and reliefs in Britain. We need to properly and repeatedly evaluate them to ensure they are increasing both the equity and efficiency of our changing economy. In particular, we need to ensure our tax system encourages risk-taking and investment, and properly taxes income derived from luck and rent-seeking.” 

Sam Dumitriu, Research Director for The Entrepreneurs Network and report author, commented:

“The Chancellor has rightly made the link between the tax system and our consistently low levels of business investment. It’s vital then he puts his money where his mouth is by radically reforming the way we tax businesses. 

“Moving to a system where businesses are able to deduct in full the costs of new investments from their corporate tax when the super-deduction expires, and fixing business rates so they no longer punish investment in commercial property, would be a powerful signal that the UK is open for investment.”

The Rt Hon Sir Vince Cable, former Secretary of State for Business, Innovation and Skills, commented:

“This paper has recommendations for business reform which are eminently sensible and practical but would go a long way to provide consistent incentives for investment, modernise the discredited commercial rate system and sort out the mess of an overcomplicated, inefficient system.”

ENDS

• This report is part of Bright Blue’s project on tax reform, which is kindly supported by the Joffe Trust and Social Enterprise UK. However, Bright Blue retains complete editorial control over the report. The views in the report will not necessarily reflect the views of the sponsor.
• This report has been commissioned by a high-profile cross-party, cross-sector commission established by Bright Blue to advise on reforms to the tax system in the years ahead to support the post-pandemic economic recovery, the restoration of the public finances, and the achievement of better economic, social, and environmental outcomes. Bright Blue has commissioned independent experts to provide original analysis and policy recommendations in four areas of tax policy: carbon taxation, property taxation, business taxation, and work and wealth taxation. The commissioners do not necessarily endorse the findings of this particular report.

Evidence given by Bright Blue’s Senior Researcher, Anvar Sarygulov, the independent think tank for liberal conservatism, has been published by the Welsh Affairs Committee as part of their investigation into the benefits system in Wales.

The submission is available here.

Bright Blue, the independent think tank for liberal conservatism, and Konrad Adenauer Foundation, the German centre-right think tank, have today published a new essay collection entitled Fast track? European climate diplomacy after COP26, which includes contributions from 10 prominent and expert UK politicians, Members of the European Parliament, academics, and thought leaders.

Fast track? follows the COP26 summit in Glasgow last year, and addresses three key areas of European climate diplomacy that the UK and the EU must cooperate on, despite the UK’s departure from the bloc: security, migration, and innovation. It continues the conversation among European friends and allies about how best to work together to decarbonise and achieve net zero in the crucial decades ahead.

In his essay, Tom Tugendhat MP, Chair of the Foreign Affairs Committee, said:

“Many refer to climate change as a necessary area of cooperation with China that should be siloed off from the confrontation over human rights and competition between strategic rivals. But, as things stand, the response to climate change is hard to detach from questions about political differences and strategic dependence …

“In this new era of mass adoption of renewable technologies, the road to net zero will become increasingly inseparable from questions about the resilience of supply chains, human rights and strategic rivalry.

“We need a new approach. Perhaps a better way to think about geopolitics and climate change might be constructive competition. What might it look like if governments were to frame climate change as a race to capitalise on soaring demand for low-carbon industries, part of a competition for the prize of global climate leadership?”

In his essay, The Rt Hon Damian Green MP, former First Secretary of State, said:

“However we measure it, a cut in this part of the aid budget will not help us address climate change and associated migration. Also, it seems inconsistent to be paying extra for energy domestically because of green levies if at the same time we are not encouraging the rest of the world to fight climate change as well.

“Of course other parts of the aid budget contribute more generally to long-term economic growth in poorer countries, which is another way of alleviating the pressure to emigrate to the richer Global North.

“Another policy area which requires constant attention is the diplomatic element in controlling migration flows. For the UK this means better relations with France, and I have sympathy with our Government given the current French stance on a number of issues. But those cross-channel issues will in the end be solved better in France, or further south, rather than in mid-Channel or when the asylum seekers reach the UK. So gritted teeth and a determination to work with the French are needed.”

In his essay, Lukas Mandl MEP, Vice-Chair of the European Parliament’s Sub-Committee on Security and Defence and a Member of the Committee on Foreign Affairs, said:

“While climate change in itself might not be a direct cause of conflict and nation state insecurity, it can be considered as a threat multiplier, exacerbating existing insecurities. Aside from the security implications it causes, climate change may produce secondary effects such as weakened governments, political instability and conflict. This has a particularly strong implication for so-called ‘failed states’. Such states are those whose capabilities to adapt to climate change are limited, thus making them extremely vulnerable.”

The essay collection includes contributions from Tom Tugendhat MP, Chair of the Foreign Affairs Committee; Lukas Mandl MEP, Vice-Chair of the European Parliament’s Sub-Committee on Security and Defence and a Member of the Committee on Foreign Affairs; Sam Hall, Director of the Conservative Environment Network; Georgios Kyrtsos MEP, Member of the European Parliament’s Economic and Monetary Affairs Committee; The Rt Hon Damian Green MP, Minister for Immigration from 2010-2012 and former First Secretary of State from 2016-2017; Tomas Tobé MEP, Chair of the European Parliament’s Committee on Development; Tim Loughton MP, Member of the Home Affairs Committee; Dr Ayesha Siddiqi, Assistant Professor at the Department of Geography at the University of Cambridge; Michael Stephens, Senior Associate and Policy Lead at Globesight and Associate Fellow at Bright Blue; and Radan Kanev MEP, a Bulgarian Member of the European Parliament.

The views expressed by particular individuals are not necessarily supported by other contributors to the essay collection.

Ryan Shorthouse, Chief Executive at Bright Blue, commented:

“As the Russian invasion of Ukraine shows, when faced with threats to global security and order, the continent of Europe – including those inside and outside of the EU – do and can come together.

Climate change is the biggest challenge this continent faces this century. COP26 was yet another milestone in demonstrating European support for and leadership on decarbonisation. But there is much more to do to enable a fair and realistic transition to a net zero world.”

Matthias Barner, Director at the Konrad Adenauer Foundation, commented:

“Climate change has no respect for national boundaries, and no country can hope to counteract its worst effects on its own. The UK and EU are two of the most credible actors when it comes to climate action and have the capacity to lead and bring others onboard.”

ENDS