Net Zero policies are pushing up inflation and hitting economic growth, a top Bank of England policymaker has warned – though she does not see that as a reason to oppose them. The Telegraph has more.
Climate change policies including carbon taxes and emissions trading schemes risk raising costs for families as companies pass the extra costs on to their customers, said Catherine Mann, a member of the interest rate-setting Monetary Policy Committee.
Economists have found “that carbon taxes, public investments, and subsidies are all inflationary”, she told an audience at the University of Oxford.
Ms. Mann added: “Evidence has suggested upward pressure on inflation [and] downward effects on output.”
The warning comes at a tough time for the Bank of England and for British households, with inflation still running at 6.7%. This is more than three times the Bank’s 2% target. At the same time the economy is flatlining.
It comes after the Government rowed back on some of its Net Zero policies, delaying a ban on the sale of new petrol and diesel cars from 2030 to 2035. In September the Prime Minister also said he would delay the ban on new oil-fired boilers from 2026 to 2035 and increase grants for heat pumps.
The Bank of England itself has faced criticism for its focus on climate change, a move promoted by former Governor Mark Carney in departure from its traditional role of concentrating on interest rates and the state of the banking system.
But Ms. Mann hit back at this criticism on Monday, arguing the Bank’s interest in climate change and Net Zero policies is critical because they affect inflation.
“Not only is it within my remit to respond to the macroeconomic effects of climate change, but, in my view, my remit requires me to do so,” she said.
“When climate change has macroeconomic effects – whether physical impacts from extreme weather events and higher average temperatures or transition effects associated with transforming to a Net Zero economy, including explicit implications for inflation – it becomes a concern for monetary policymakers, directly within a price stability mandate.
“That applies whether the monetary policymaker’s remit includes a reference to climate change or not.”
Ms. Mann, who has consistently voted for higher interest rates than the majority of the nine-strong MPC, said Net Zero policies affect inflation as governments seek to push businesses away from established, but polluting production methods and into new greener methods.
But this means piling extra costs onto polluting businesses “presumably to be passed on fully or in part to consumers, which prompts the behavioural change needed to reduce emissions”.
Even if consumers themselves choose to buy less polluting products, the extra demand will push up prices until companies can boost the supply of the greener goods and services, Ms. Mann added.
Worth reading in full.
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I would observe that they are doing precious little to support the Farmers, perhaps they
just retain an old name but no longer really see that as their core business, they are keener I think to sell insurance and other financial packages to all and sundry. It might be worth looking at who they have big insurance contracts etc with, that might provide a clue as to who they really serve.
I think you’re barking up the wrong tree here. There’s no formal connection between NFU Mutual and the National Farmers Union, although (as helpfully explained by ChatGPT) “NFU Mutual and the NFU collaborate on farming-related issues, and many NFU members choose to insure with NFU Mutual”.
Given the lukewarm NFU support for the grass-roots farmers’ protests, what’s the betting that a UK equivalent of DOGE would discover interesting funding streams coming from Big Farmer?
I expect it’ll be same as organisations like the CBI that receive all kinds of overpriced government favours (consultancies, training contracts etc.) as long as they toe the party-line. After a while, the easy availability of such income streams lessens the significance of the subscription income from their actual members and, as the author described, encourages them to become self-serving.
In the CBI’s case, it got to the point where the senior management ended up going rogue and the whole organisation had to be rebuilt as a shadow of its former self. Perhaps the NFU is due to go the same way?
Let’s bloody hope so.
Thank you, David Craig. Shades of Ofgem, Ofcom and Ofwat – silly me, thinking once upon a time these lumbering, parasitic quangocracies must have been set up in the interest of consumer protection…
…Whereas nowadays morphed into self-serving organs of gov.uk, operated for gov.uk, by gov.uk, to keep gov.uk’s ripped-off citizens in line.
Better not get myself started (again) on that 25% increase in water bill that slithered through our letter flap the other day. Improvements in health… Environmental quality… Climate change… Blah, blah, blah, explains an accompanying letter from “Mike, Customer Services”, headed, “Creating a stronger, greener and healthier North West.”
Plans “independently assessed and aproved by our regulator,” Mike also reassures.
No mention of Oftwat remonstrating with United Utilities and gov.uk, on behalf of bill-paying consumers. Too busy walking the dog, picking up the kids and rattling off vacuous word salads from home.
Thanks Mike, thanks Oftwats. Off with their heads, their overblown billpayer-funded salaries and their word salads. Get rid.
I resigned a couple of years ago as I got fed up with them parroting the government line on global warming and doing FA to stop net zero impacting farmers
How many more of these useless self-serving organisations have we got?
RSPB – which has had absolutely nothing to say on the subject of the bird mincers.
RSPCC – which has had FA to say about the Pakistani Rape Gangs.
British Heart Foundation – wholly supportive of every bit of madness pushed by government throughout the Scamdemic and particularly masks for those suffering from heart disease and which I challenged them on. And they still push the C1984 “vaccines.”
There are of course scores of others. A massive Trump style decimation is required although decimation alone might be too sparing.
NFU – Next to Fucking Useless.
I wonder what James Rebanks thinks of the NFU.
I own a smallholding but no longer farm it, too much form filling and bureaucracy. Last year I asked NFU for a buildings and contents insurance quote.The NFU have an office in my local town and at least 2 staff. Their quote was over five times more that using a price comparison site and the office rarely has anyone in it other than the staff.that seem to have nothing to do.
Your analysis of the servers and self servers is brilliantly simple yet incredibly accurate. Thank you for the clarity of your arguments and your article.
Is the nfu a bit like our usaid? Unaccountable. Well you can see what is happening to the usaid. It is being extinguished, by the new sheriff in town. So, if those running the nfu would like to keep their jobs perhaps they may want to show some accountability, for starters. Our farmers and the country’s taxpayers deserve this at a minimum.