However, there are two things that our Executive should be doing.
First, they must do everything in their power to mitigate the effects of recession on the people of Northern Ireland.
Second, they must place Northern Ireland to maximise the opportunities when economic recovery eventually comes.
Indeed, the two can dove-tail together, not least when one talks about the importance of the green economy.
Unlike some others that I could mention, the Alliance Party has no delusions over the realities and consequences of climate change.
Among some of those who accept the existence of climate change, there is the claim that things are just too difficult today with the economy to add even more costs – the problem should just be pushed down the pipe.
Alliance firmly rejects this approach.
While the excellent Stern Report highlights a potential cost of 1% to Global GDP in terms of dealing with climate change today, it draws a stark warning of potential costs of between 5% and 20% of Global GDP in the future if climate change is not adequately addressed from today.
But we should also acknowledge the potential for new sources for economic growth and for employment from rebalancing the economy to address the new environmental context. Again Stern anticipates around that by 2050, markets for low-carbon technologies could be worth at least $500bn.
If changes have to be made and new investments undertaken, then perhaps there is no better time to commence doing so in the context of an economic downturn.
All around the world, governments are providing fiscal stimuli to address to the economic downturn.
A major theme within these packages is the green economy. In the 1930s, the United States’ response to the Great Depression was termed ‘the New Deal’. Given the opportunities that can come from addressing the environment, these measures have been deemed ‘the Green New Deal’.
So what do we mean by ‘the Green New Deal’. There are a number of obvious aspects:
- Energy efficiency in homes and businesses
- Investment public transport and other changes to our infrastructure
- Better fuel efficiency in private transport
- Further development of renewable energy
- Improving the energy network – smarter grid
Indeed, the switch to alternative energy is something that should be undertaken even outside the context of climate change.
The Alliance Party is far from being anti-growth, we support economic growth, but we need smarter growth.
Markets can drive innovation, alongside the removal of distorting subsidies and the application of ‘the polluter pays principle’.
Some investments may have some long lead-in times, in terms of research, development, planning and implementation. But many aspects could be delivered rather quickly. In terms of the new jargon, they are shovel-ready projects. The most obvious quick wins lies in energy efficiency. Most governments around the world get this to some extent.
In the United States, the Obama Administration has launched an $800billion fiscal stimulus. Over 10% of this relates to the green economy. Indeed, in South Korea, almost the entire stimulus there relates to the green economy.
Despite his announcements not being ambitious enough, the UK Chancellor Alistair Darling did at least announce in the Pre-Budget Statement that £535m would be spent on environmental investments. The Scottish Executive is making its own new investments. At the end of 2008, in the Republic of Ireland, the Taoiseach Brian Cowen published his Government’s new economic strategy, “Building Ireland’s Smart Economy: A Framework for Sustainable Economic Renewal”, which included developing the green economy as a core theme.
Most regrettably, the exception to all of this is Northern Ireland.
It seems that Northern Ireland is not to have its own ‘Green New Deal’. This is not a feature of the actions or rhetoric from our Executive. Indeed, unlike on so many other issues, they haven’t even reached the point of empty rhetoric.
Our Executive has engaged in populism rather than prudence. On top of the huge financial distortions that arise from managing a divided society, financial and economic decisions taken have undermined the flexibility and ability of Northern Ireland to respond effectively.
Sadly, the Executive has been very short-termist in their approach. There needs to be a clear understanding of Northern Ireland’s long-term competitiveness.
The tragedy of this situation is even more acute given the opportunity for Northern Ireland to be marketed as part of a ‘green’ island.
We are falling behind, but it may not be too late. Alliance must ensure that it isn’t.