The role of the Treasury in supporting the decarbonisation of the UK economy will be under the spotlight in a new select committee inquiry.

To tie in with World Environment Day, the Treasury committee has today (5 June) launched a new inquiry into the role of HM Treasury, regulators and financial services firms in supporting the government’s climate change commitments.

It will probe how the upcoming pan-government spending review, which is pencilled in to take this place this autumn, can provide additional funds for projects or measures to facilitate the UK achieving net-zero emissions by 2050.

Nicky Morgan MP, chair of the Treasury committee, has written to exchequer secretary John Glen asking how the government plans to use the review to close the “significant gaps” that must be closed in order to meet the emissions reduction targets in the fourth and fifth carbon budgets.

The committee will also look into how effectively the Treasury is working with the Clean Growth Strategy and government departments to support decarbonisation.

And the MPs will examine how the Treasury’s approach can evolve to ensure the government meets the legally binding carbon budget targets.

The role that financial services firms are currently playing in financing the transition and the economic potential of decarbonisation for the UK economy in terms of job creation and growth will also be examined during the inquiry.

Morgan has also asked Glen whether the Treasury has accepted the Committee on Climate Change’s recent recommendation that it should undertake a review into how the transition to a zero carbon economy can be equitably funded.

The Treasury committee will start accepting written evidence on its website from today, until 26 July with a scene-setting oral evidence session due to take place on Tuesday 2 July.

Morgan said: “Climate change is one of the most pressing issues of our time. With recent protests and demonstrations, it has shot up the political agenda.

“Whilst decarbonising the UK economy presents significant challenges, it also provides an opportunity for the financial services sector to unlock its green potential.”

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