Dr Darrick Evensen is a lecturer at the University of Edinburgh and a SPICe Fellow. He, along with research assistants, Manuela de Mendonca and Haley Waites, has prepared a SPICe briefing analysing the most frequently recommended policies for a green recovery in academic articles and expert reports. These findings have then been compared to the Scottish Government’s intentions for a green recovery.
The full research briefing can be found on the SPICe digital publications page.
As with all guest blogs, what follows are the views of the authors, not those of SPICe or indeed the Scottish Parliament.
Background
This blog summarises recent research as part of a SPICe fellowship which investigated policies and interventions that experts agree should form part of a green recovery from COVID-19. The project first identified which policies were most frequently mentioned by studies on green recovery, then analysed the extent to which similar themes are reflected in the Scottish Government’s Programme for Government 2020-2021.
What is a green recovery?
A green recovery seeks to achieve the dual aims of lifting an economy out of recession whilst protecting and improving the environment at the same time.
The concept of green recovery first emerged in academic research and political discourse after the 2008-09 financial crisis. However, several years of research on the impacts of the 2008 recession’s green recovery policies, and the current trajectory predicted for the climate crisis, have revealed that the green recoveries promised in many states did not fully live up to expectations.
The green recovery policies a decade ago were found to be ineffective due to being too focused on very narrow sectors of the economy, not focusing enough on the long term, and allocating a relatively small percentage of GDP and of recovery funds to green recovery specifically.
Prospects for green recovery in Scotland
One way to evaluate the extent to which Scottish green recovery policies might be successful is to examine whether they address the concerns with green recovery policies around the world in response to the 2008 recession.
Narrow focus
A critique of the previous green recovery policies is that most nations allocated virtually all of their funding for green recovery to a restricted suite of options for improving energy efficiency and shifting to low-carbon power. This was considered too narrow, and insufficient to facilitate a holistic shift to a low-carbon economy.
A broader suite of policies is recommended by green recovery scholars. To understand current recommendations for best practice in green recovery policy, a systematic review was conducted of a large sample of peer-reviewed academic articles and high-level academic reports on green recovery from COVID-19 published from 1 April 2020 through 15 September 2020. The final sample contained:
- 20 academic journal articles,
- 16 reports by academic institutes, and
- five reports and letters from academic institutions on green recovery in Scotland specifically.
Nine green recovery policies were recommended in at least 40% of the documents. Figure 1 below illustrates the percentage of documents and reports that recommends each policy. The nine most frequently recommended policies are:
- Renewable and low-carbon energy: direct investment by government in low-carbon (mostly renewable) energy technologies, or specific targeted policies to incentivise private investment in such technologies.
- Green infrastructure (generally): any mention of “green infrastructure” that does not provide further details on the type of infrastructure recommended.
- Green infrastructure (transport): low-carbon infrastructure for transportation, such as walking, cycling, and public transport.
- Green infrastructure (buildings): anything related to improving carbon efficiency of public or private buildings, such as retrofits and standards for new construction.
- Restoring / improving natural capital: such as planting trees, peatland restoration.
- Reskilling and retraining workers: especially, but not exclusively, helping workers in carbon-intensive industries transition to jobs in low-carbon or other green industries (e.g. moving from one energy sector to another).
- Short-term green jobs: jobs occurring and ending within the next 0-5 years, such as in infrastructure development or natural capital restoration, that bring people back into the labour force, but are not long-lasting positions.
- Conditional bailouts for carbon-intensive industries: the claim that if carbon-intensive industries are to be given bailouts, conditions must be attached for them to become lower carbon in the future. The reference is always to carbon-intensity, but could also include reference to industries with additional environmental impacts (e.g., biodiversity or water quality impacts).
- Green research and development: any investment in furthering research into low-carbon solutions, particularly in the energy systems and in areas that are novel or have not yet reached economic viability (e.g., CCS, hydrogen, wave/tidal, geothermal).
Figure 1: The percentage of the documents analysed that recommended a particular policy
There is a broad similarity between the policies most recommended by academic experts and those proposed by the Scottish Government in the Programme for Government 2020-2021. Eight of the nine policies most commonly recommended by experts are mentioned to some extent by the Scottish Government.
While the current Scottish Government cannot make commitments beyond May 2021, due to the upcoming Scottish Parliament elections, the Scottish Programme for Government 2020-2021 outlines intentions for the next five years / next Parliament (2020-2026) and the amount of funding intended to be spent. These intentions and the funding attached are shown in figure 2.
Figure 2: Scottish Programme for Government 2020-2021 funding recommendations for green recovery policies over the next five years / next Parliament (2020-2026)
The frequency with which policies are recommended by academics highlights only that this is an area that scholars agree should form part of a green recovery, but areas of high agreement are not necessarily the areas that require the most funding relative to other green recovery policies. Therefore a direct comparison between the frequency that a policy is mentioned and Scottish Government budgets is not straightforward. Nonetheless, the Scottish Government has, in general, allocated large amounts of funding to the same policies that are most frequently mentioned by scholars in the academic sample.
Short-term versus Long-term
The systematic review of the academic documents showed 71% of the sample recommending policies that employed a long-term focus (5+ years), with 27% discussing the need for long-term policies as a major emphasis in the document. Short-term policies were promoted in 41% of the sample, but no documents included this as a major emphasis.
Scholars at the Vienna Institute for International Economic Studies explain,
‘There are likely to be trade-offs between short-term goals (maintaining incomes and employment) and longer-term aims (such as structural transformation and decarbonisation)’.
Jérôme Creel, Mario Holzner, Francesco Saraceno, Andrew Watt, Jérôme Wittwer, The Vienna Institute for International Economic Studies
Therefore, whilst policies that focus on short-term and long-term gains are needed, the goals are different and the long-term goals in particular are those that will foster a transformation towards a greener economy.
Additionally, environmental policy experts from the Jacques Delors Institute assert,
‘Carefully applied, targeted one-off public investments may develop an important signalling effect and trigger other, long-term adjustments—especially if they are embedded in a long-term regulatory framework providing the necessary political and legal certainty for other, in particular private investors’.
Geneviève Pons, Marie Agnès Borchers-Gasnier, Pierre Leturcq, SAIS Review of International Affairs
Therefore, beyond the funding itself, clear policies about the economic structure that will be supported going forward is part of the long-term focus.
The Scottish Government Programme for Government 2020-2021 mentions both short-term (0-5 years) and long-term (5+ years) policy goals, though of course these are contingent on the outcomes of the Scottish Parliament elections in May 2021. Specific policies and allocations of funding are envisioned in the near future as well as over ten year periods. The First Minister’s introduction to the Programme for Government cites a long-term vision for different sectors of the economy and society.
On balance, more Scottish Government policies speak to a short-term (0-5 years) time frame than a long-term vision. This is in some ways to be expected due to the nature of an annual Programme for Government and a Parliamentary session of 5 years, but does not negate the ability to act now to secure long-term goals.
For example, the Scottish Parliament’s Environment, Climate Change and Land Reform Committee recommended following their inquiry on a green recovery that the Scottish Government front-load spend on a green recovery in the short-term to build a foundation for the longer term. In giving evidence to the ECCLR Committee on 15 September 2020, Chief Executive of the UK Committee on Climate Change, Chris Stark, suggested that a long-term recovery also begins in the immediate term in areas which can be in governments’ short-term control.
Portion of GDP for Green Recovery
Professor Edward Barbier, economist and one of the most widely recognised scholars writing on green recovery for the last decade, has argued that ‘a sustained green recovery and transition would require expenditure of at least 1% annually of GDP by G20 economies’. He reports, in contrast, that green stimulus following the 2008 recession accounted for only 0.3% of French and of UK GDP, and 0.5% of German GDP.
Whether greater weight has been given to green recovery policies following Covid-19 and whether governments and economies live up to Barbier’s 1% remains to be seen, and will become clearer as policies are implemented and funding spent. While outwith the scope of this study, it will also be important to look at spend on other things outside the green recovery portfolio, to assess whether other funding is directed towards policies that complement green recovery goals, or which potentially counteract its benefits.
Where now for Scotland?
The above analysis reveals that the Scottish Government’s proposed green recovery policies align fairly well with expert recommendations for what sectors green recovery policies should address.
Careful attention to the long-term transformation – not just short term recovery – will be essential to the success of a green recovery. Clearer understanding of Scotland’s level of proposed investment in green recovery policies and the timeframes for the investment will be important. Further, views and preferences for green recovery policies from members of the public in Scotland could be relevant.
There is a real opportunity to link green recovery policies to a longer-term vision through Scotland’s Climate Change Plan and to Scotland’s role as host of COP26. Research reveals that the COP host nation can have strong effects on ambition in COP outcomes. There is an important opportunity to use both green recovery policies and the Climate Change Plan to show leadership as preparations step up for COP26 in Glasgow.
The full research briefing can be found on the SPICe digital publications page.