Submission to Comprehensive Spending Review - Confederation of Timber Industries
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Submission to Comprehensive Spending Review

We are calling for greater long term support for a green economic recovery and resurgence of the construction industry in our submission on the Comprehensive Spending Review.

Without a doubt, COVID-19 will have a major effect on the Government’s financial approach to the next three years, which will need be coupled with long term considerations such as the legislative commitment of the UK to Net Zero emissions by 2050.

As you prepare for the review, we would like to outline how the timber industry can contribute to the aims of the Government, under the guidelines you have provided, and the specific actions we recommend for supporting the timber industry to best make these contributions.

Firstly, with the All Party Parliamentary Group for the Timber Industries last year we published a report on How the timber industries can help solve the housing crisis, which includes many of the economic, educational, social and environmental benefits of building with timber. At its most simple, using sustainable timber in construction allows for a reduction in the carbon dioxide emitted from the construction process. The use of wood in construction has been repeatedly recommended by the independent UK Committee on Climate Change, most recently in their Reducing UK emissions progress report to Parliament’, in their Net Zero Technical Report’, and substantially, in the 2019 report ‘UK Housing: Fit for the future?’.

Secondly, as we recently highlighted in our report on Why timber is leading constructions Net Zero recovery, while we emerge from the COVID-19 crisis we have the most united construction industry in living memory, a need for an increase to investing in retrofit and rebuild, and alignment on goals such as decarbonisation and manufacturing via the Construction Leadership Council’s Roadmap to Recovery in construction. Timber is at the forefront of sustainable construction, and by taking the time now to transform the way we build, and embrace wood in construction, we can combat climate change and create a built environment which supports future generations.

In both publications, we have outlined in detail how the timber industry can support a more sustainable, prosperous, and global Britain, if supported with the right policy environment. These are all aligned with the guidelines of the Comprehensive Spending Review. Below we have set out the specific financial policies and spending we recommend which would support timber construction, along with the Government’s policy goals.

Make a long-term spending commitment which reflects the Government’s intention to support the building of 300,000 homes a year on average by the end of 2022.

We need to build more houses, quickly, while using sustainable construction methods. Government can help make this happen by creating a pipeline for construction, attached to the legislative goal to be Net Zero by 2050. This will encourage investment by businesses into innovative, and sustainable construction methods, such as offsite construction, which is necessary for overcoming both the climate and housing crises.

Such a commitment by Government will of course in the short-term help fuel a low-carbon economic recovery across the UK by encouraging house building activity, skills development, and jobs in every region. However, over the long term such a pipeline will help overcome some of the barriers to investment which currently hinder innovation in the construction industry, as a lack of certainty over future funding streams limits incentives for industry to invest. This pipeline would best achieve results if it were combined with the compulsory specification of sustainable/low-carbon materials and methods in procurement policy, and the better management of policies which limit the use of innovative materials, in order to funnel these investments towards sustainable construction using timber and other proven low carbon materials.

Support a Net Zero carbon retrofit programme for existing homes

The Government has rightly invested £9.2bn into a national retrofit programme of energy efficiency improvements. Along with the Construction Leadership Council, we ask that the Government build on this commitment by creating a long-term plan for carbon reduction for homes. Such a programme is essential for reducing the carbon emissions from our built environment, with the UK Green Building Council estimating that 10% of UK total carbon emissions come from heating as a result of our carbon intensive energy sources and poor insulation. These measures could also be used to support and expand the UK’s high quality, high performance manufacturing base for building products. Other measures which could be used to support the improvement of existing homes in the UK would be a demand side stimulus, such as a zero rate of VAT on home improvements.

Align public spending and procurement in housing and construction with the Government’s legislative goal to be Net Zero by 2050.

Through the transparent, and broad-based alignment of public spending and procurement with the Government’s goal to be Net Zero by 2050 this will help incentivise investment by the commercial sector into more sustainable forms of housing and construction, as well as infrastructure and manufacturing centres. This should be included in a broader stream of work by the UK Government to disentangle public spending from fossil fuel revenues, and the use of public policy to funnel private investment into low carbon solutions and technology.

While in some industries ‘carbon accounting’ can be difficult, and can be accompanied by unclear and indirect links between public spending and carbon emissions, in construction the link between spending and the operational and embodied carbon emissions which result can be more easily established.

Therefore, public spending in construction in housing should be accompanied by clear rules for the measurement of carbon emissions and an accompanying preference for lower carbon forms of construction. This would serve as a useful base for working on the fiscal rules which will help better deliver and measure economic, social and environmental benefits from public spending.