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Net Zero: Poorest 40% of Households Could Fall into Transition Poverty

net zero

A new report from the Institute for Community Studies at the Young Foundation, University of Leeds, University of York and Trinity College Dublin calls for a fair and inclusive transition to Net Zero. The report warns the Government’s existing Net Zero transition policies are likely to make the poor poorer, and push struggling communities further into deprivation and exclusion. 

The research finds the poorest 40% of households at risk of falling into ‘transition poverty’ and calls for public involvement in a fair and inclusive Net Zero strategy to mitigate this, and outlining eight key policy recommendations.   

Combatting Transition Poverty

 The research, which was funded by the Nuffield Foundation, identifies profiles of households and communities across the UK that are at risk of being impacted negatively by current Net Zero policy, with a large proportion potentially facing ‘transition poverty’ due to the cost of changes in how we go about our lives.

Existing environmental policies, which the report says have not taken inequalities into account, are likely to create winners and losers – shaping who benefits and who is adversely affected. The report argues that if the changes decarbonisation demands of households are poorly managed, the UK’s Net Zero transition risks pushing already vulnerable families and communities further into deprivation and exclusion.  

In the context of the cost-of-living crisis and the government’s ’levelling up’ project, people with vulnerabilities relating to existing debt, credit, or constrained spending power; people in social or rented housing; and communities in areas with fragile local economies, are shown to face the greatest barriers to participation in Net Zero transition.   

Yet the report finds a significant appetite from the public to support the transition, regardless of these vulnerabilities. Many people were keen to participate in low-carbon living, with some taking on ’DIY’ strategies at home, ranging from homemade solar lighting to DIY insulation techniques. At the same time, central and local government were not seen, or trusted, to lead the charge. Furthermore, the report highlights assets, infrastructure and policies that enable some communities to be more ‘ready’, or to accelerate their participation in Net Zero transition, than others.   

An Inclusive Net Zero Strategy

The report calls for integrated policy moving away from the Government’s focus on technological and business solutions, towards a plan which understands that starting points differ. Strengths and vulnerabilities must be identified and worked around and a ‘person-centred, place-based’ strategy must be taken. Net Zero policies must therefore not take a generalised approach and consider how ‘ready’ different localities and communities are for a green transition.

  Researchers brought participatory primary research, a review of poverty and social justice literature, and a review of scenarios of change towards Net Zero in the UK together for the first time. Findings were shared with local government and communities in four local authorities in England, exploring what incentives, levers and policies might unlock greater, inclusive participation in transition.     

Building on these co-created policies, the report now calls for an integrated system with strategic alignment between national and local government, and public service providers, the private sector, and communities. Recommendations include:  

  • Apply the Institute for Community Studies’ newly-developed framework of a person-centred, place-based approach to policy development to understand the specific barriers, capabilities and opportunities facing those who are already – or highly likely to be – adversely affected by the transition to Net Zero.   
  • National policy should remove the most significant barriers for the poorest households, and design incentives that support households to participate in the transition, such as new economic support packages to cover the largest upfront costs of retrofit. Such support must account for households’ whole spending power and budget constraints.  
  • Explore alternative levels of governance for Net Zero policy with distributed powers, then creatinga specific vision and plan for each geographic area. These systems should have devolved powers and clear strategies to work across local authorities, anchor institutions and local communities.  
  • Engage people in the design of fair outcomes to enable a place-focused, inclusive debate during, and as a result of, Net Zero transition. This must recognise inequalities, injustices, and emerging risks to certain households with expensive heating systems, technologies and tariffs. It must also engage the public meaningfully in decision-making.  
  • Build collective action and policy for Net Zero transition. Motivation to participate in Net Zero is stronger when connected to place. Local government, public-private partnerships, innovators, the voluntary and community sector, and communities should come together to enable a fair transition for all households. 
  • Local leaders, civic actors and investors should adopt a data-driven, ‘place readiness’ approach. The Institute for Community Studies is developing an ‘Index of Place Readiness for Net Zero’ as a valuable diagnostic tool for investors, government and charitable actors to create faster, fairer progress towards Net Zero in local communities. 
  • Recognise, within government, the need to engage other trusted actors. Employers are key influencers and enablers of participation in low-carbon household practices (through, for example, EV schemes; recycling; driving ‘green’ transport choices; and using green energy). This suggests a powerful role for investors and the private sector to create stronger, place-led investment strategies for public-private partnership, which could accelerate a just transition.  
  • Update the existing Climate Change Committee (CCC) Risk Assessment to provide a broad and true picture of community and household vulnerabilities. This means expanding the CCC Risk Assessment to include a greater set of social, asset-based, social infrastructure measures, driving a national strategy for public participation in a just transition.  

Responses

Emily Morrison, Director of Sustainability and Just Transition at The Young Foundation said: “Our research shows there is a will, an appetite, and even an urgency amongst the public, including the most vulnerable and poorest households, to participate in the transition to net zero. But this has to be enabled through policy and practice that works with real people’s lives, and the places they live in. Current policy will result in winners and losers through net zero transition, and we cannot let it become another part of UK policy that needs to be ‘levelled up’. If we build participation, rather than waiting to nudge people and hoping they’ll comply, and if we remove barriers, build on community assets, and maximise local readiness, we can reconcile decarbonisation with fair and just outcomes that mean decarbonisation does not leave anyone, or any place, behind.”  

  Alex Beer, Head of Portfolio Development at the Nuffield Foundation, said: “This important research highlights that the current patchwork of policies aiming to enable the transition to net zero is in danger of exacerbating existing inequalities, and it identifies their impact on already vulnerable households and communities. But it also points to opportunities to create a just transition. National and local government, employers, and the voluntary and community sectors should take note of the framework it provides to support them in building collective place-based strategies that unlock greater, inclusive participation in transition.”  

 Final thought

A fair and inclusive net zero strategy is needed to reduce the risk of pushing poor people into transition poverty. Reaching decarbonisation goals requires participation from everyone, but due to the large-scale change in how we go about our lives, the report crucially notes that there needs to be more public conversation to ensure that measures are relevant and sustainable for all.

For media enquiries please contact Sarah Hogg (sarah.hogg@youngfoundation.org / 07940 281470) or Jess Moore (jessica.moore@youngfoundation.org / 07535 976 933). 

Curia

Independent, cross-party, and not-for-profit, as a policy institute Curia turns policy into practice as the UK’s first “do tank”. Through both the levelling up and energy sustainability commission, Curia seeks to create an equitable and sustainable future.

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