Carbon sector derailed by government changes

Posted on 10 Nov 2011 by The Manufacturer

CBI’s director-general labelled the government’s decision to cut solar feed-in-tariffs (FiTs) before the consultation period has ended as “the latest in a string of government own goals”.

In a speech about the UK’s need for industrial policy at the CBI East Midland Annual Dinner, John Crindland stated that the carbon sector was being disrupted in the UK, with the loss of thousands of jobs, by unexpected changes

Mr Cridland said: “As you all know, moving the goal posts doesn’t just destroy projects and jobs, it creates a mood of uncertainty that puts off investors and they wonder what’s coming next.”

“Some companies have invested heavily in solar photovoltaic systems, and in the supply chains needed to install them. That commitment has been undermined by the feed-in tariff decision – and so industry trust and confidence in the government has evaporated. This bodes poorly for investment in future initiatives.

“A new industrial policy needs to recognise the real-time costs of these decisions, and should set out a clear path that investors understand and can believe in.”

The decision comes as a surprise to the industry which has experienced growth across the world throughout the recession.

Turning to the Government’s ability to use its buying power to stimulate innovation, Mr Cridland added: Our government’s the largest single consumer of goods and services in the UK. It can use this buying power to help shape a competitive future for business.

“Government departments and agencies need to look beyond lowest price and consider whole-life value and how business is involved throughout the process.

“Take defence. It must be possible to achieve the twin aims of getting our servicemen and women the best kit, and gaining some advantage for our domestic industries. But we’ve gone backwards since the defence review.