Sir Keir Starmer has woken up to the fact that his policies are killing one of Britain’s last successful manufacturing industries, the £90-billion-a-year car industry, on which 800,000 jobs depend.
‘This is the beginning of a new era,’ said Starmer yesterday, as he announced plans to aid the motor industry by relaxing environmental rules following Trump’s 25 per cent tariffs on cars imported into the US. ‘That’s why we are rewiring the state completely, removing any barriers or blockages so it can fulfil its actual function once more: making people’s lives better.’
Despite his lofty rhetoric, the changes Starmer announced are minor tweaks. He should go far further if he really wants help the car industry and get rid of the eco-policies that have all but destroyed it – by doing so he could save the economy at the same time.
Britain’s unique obsession with Net Zero, when we produce just 0.8 per cent of the world’s carbon dioxide emissions, is killing our economy faster than wokery, immigration and bureaucracy put together. The cost of achieving Net Zero carbon emissions in the UK is estimated to be £1.4trillion over the next 30 years, according to the Office for Budget Responsibility. That’s over £50,000 for every UK family.
But unlike immigration and bureaucracy, these policies can be reversed at the stroke of a pen. What is more, Donald Trump, by slapping tariffs on British exports, has gifted Starmer with the perfect excuse to ditch not just the zero-emission-vehicle (Z Mandate) scheme that is hammering the car industry but the Net Zero fiasco in its entirety.
Starmer, however, is still insisting on phasing out all sales of new petrol and diesel cars by the end of 2030 – although under his new rules, hybrid vehicles have been given a five-year stay of execution until 2035. He still retains absurdly precise interim targets for a reduction in the production of fossil fuel vehicles for each year before then, albeit with a bit more leeway to ‘borrow’ Electric Vehicle sales credits from future years until 2029.
He is still imposing fines for those who don’t make those targets, though down from a painful £15,000 to a merely eye-watering £12,000 per car. He is still in favour of foreign imports of electric cars, keeping in place the scheme that allows British manufacturers to buy surplus credit from another manufacturer that is meeting the quotas – usually a Chinese one. This acts like a tax on home-grown cars.
In short, Starmer’s proposals are too little and almost too late. UK car production last year fell to its lowest level since 1954. New car sales to private individuals are now lower than during the Covid pandemic.
Huge damage has already been done to a proudly successful British industry by a policy that will achieve almost no reduction in carbon dioxide emissions anyway. Remember, tests by car makers show that you have to drive an electric car around 50,000 miles before you even begin to save significant CO2 emissions. Probably further if you take into account that a big chunk of our electricity comes from the Drax power station in North Yorkshire burning North American trees, the most carbon-rich fuel of all.
And what if customers don’t want to buy electric cars? Currently, only 20 per cent of car buyers are going electric despite discounts and other incentives in the showrooms – higher among fleet and Motability buyers, lower among private buyers.
Britain, remember, has the highest electricity prices in the developed world thanks largely to the costly Net Zero driven dash for wind and solar and a refusal to exploit our own gas reserves, instead relying on much more costly imports of liquefied natural gas to keep the lights on when the wind does not blow.
The dismal thing about the Z Mandate is it treats you, the customer, as a serf who must do as told. The idea that people might be allowed to choose the cars we prefer was thrown away by Boris Johnson and Rishi Sunak.
That is why Starmer could have used this week to scrap it, blame his predecessors and President Trump, and leave the car market to, er, let the market decide. But if logic cuts no ice with Labour, perhaps politics will.
Judging by what my fellow Northumbrians tell me, if Starmer goes to the polls in 2029 still promising to end the sales of petrol and diesel cars a year later, he can forget winning any even semi-rural seats. Likewise, he could have announced he will head off a similar fiasco in the home-heating industry – and an even worse election headwind.
Some plumbers I speak to are already pulling out ‘eco friendly’ air-source heat pumps faster than they are installing them, as customers realise they cost a fortune in electricity to run and provide all but the most insulated homes with lukewarm radiators on cold days. With drill-baby-drill policies in the US, the world’s biggest gas producer, driving down gas prices, and offshore wind farms driving up electricity prices, the cost of switching your home heating from gas to electric will only grow.
Again, Starmer could easily do away with the scheme and blame The Donald. After that, the 2030 target for decarbonising the electricity grid altogether has to go. Nobody with half a brain thinks it can be done, let alone affordably. Only nuclear can provide enough reliable power without emissions, but not by 2030. And if he is serious about a bonfire of the quangos as he has said, Starmer should watch a jaw-dropping recent exchange at a parliamentary hearing with his boss (the Climate Change Committee has statutory power to tell the Government what to do, so Emma Pinchbeck, the chief executive, is the person to whom Starmer effectively reports).
Pinchbeck told the Lords Environment and Climate Change Committee that she plans to ‘persuade’ people taking multiple flights a year to cut down by whacking a huge tax on people who fly frequently. That way, she said patronisingly, ordinary people could still have ‘the annual family holiday to somewhere sunny like Spain’. Nothing less would do if we are to meet her next carbon budget. Watch out, jet-setting Ed Miliband!
Again, imagine taking this policy to the electorate in four years’ time: sorry, you have had your one trip per family this year so here is a huge fine for attending a friend’s wedding in Florida.
If Starmer is serious about ‘removing any barriers or blockages so Britain can fulfil its actual function’, then he could blame Trump and suspend the goal of achieving Net Zero by 2050 altogether. He could amend the Climate Change Act, drop the zero-emission vehicle targets, reduce the subsidies for wind and solar, mothball the offshore wind turbines rather than the oil rigs in the North Sea and start exploiting our huge reserves of onshore shale gas.
And let people buy what cars they like, install boilers that work and take as many holidays in the sun as they want. The climate would not notice but the economy would boom. Indeed, if the Government puts even a small part of the savings that result into researching better energy technologies, like cheaper nuclear or fusion, then it might eventually achieve Net Zero anyway.