Source · Select Committees · Environmental Audit Committee
Recommendation 29
29
Accepted
Paragraph: 161
Local authorities hindered in green finance by fragmented funding and limited capacity
Conclusion
Local authorities have a significant role to play in green finance, from delivering grants at the household level, to collaborating with financial institutions on local net zero projects, and crowding in private capital for large scale projects. However, they are hindered by a fragmented funding landscape and limits on technical capacity.
Government Response Summary
The government agrees on the importance of local authorities and outlines several initiatives to support them, including a £19m Local Net Zero Accelerator, Local Net Zero Hubs, UK Infrastructure Bank lending, and a commitment to simplify and consolidate funding, backed by the Funding Simplification Plan.
Paragraph Reference:
161
Government Response
Accepted
HM Government
Accepted
We agree that local authorities are important players in the delivery of national net zero targets and are well placed to lever in commercial investment for net zero. To support them in this we are providing £19m for a Local Net Zero Accelerator programme to unleash the potential of local government to attract private sector investment for green growth by piloting new approaches in three areas. This is alongside our Local Net Zero Hubs Programme which supports local authorities to develop net zero projects and attract commercial investment. The UK Infrastructure Bank also includes a lending facility of £4 billion for local authorities at preferential rates. There is a range of funding available for local authorities to meet net zero, including through their core settlement, grants, and UK Growth funding. In the Net Zero Strategy the Government committed to exploring how we could simplify and consolidate funds which target net zero initiatives at the local level where this provides the best approach to tackling climate change, and we are taking this work forward. We have already announced pilots of a devolved approach to buildings’ retrofit for the trailblazer devolution deals in West Midlands and Greater Manchester Combined Authority. More generally, the Levelling Up White Paper set out the Government’s ambition for a simpler and more streamlined funding landscape for local authorities. We are committed to continually improving the way funding is delivered and we published the Funding Simplification Plan in July 2023. This plan sets out the Government’s ambition for increasing the effectiveness and efficiency of the current funding system.