However, there are significant costs implied by the scheme. Labour calculates that delivering essential upgrades to the UK’s entire housing stock will cost about £250bn, or an average of £9,300 per house. The party pledged to provide £60bn of direct public subsidy for the programme, with the rest paid for “through energy savings”.
OK. No, take their numbers. Let’s not worry about examining them.
So, on that basis an answer as to how the whole sum will be funded is required.
The fact is that, me apart, I can see now one who has n answer to this. Naomi Klein is miles off target in her latest book. Ann Pettifor cogently argues it is by borrowing in her latest book. But no one says who will buy those bonds. I have, here. Changing the rules of ISAs and pension funds could provide all the cash needed to fund the Green New Deal. The issue is so vital I will be returning to it, again and again, I suspect. We have to get this right.
OK, fair enough.
Now the tough bit. For we’ve not got a mechanism here by which the pensions investors get the savings from the energy bills. How does that work?
My flat is lent money to insulate. This reduces energy bills. Great. Money goes back to those pensions investors. Both interest and, at some point, the capital sum because people do consume their capital as they spend their pensions.
So, what’s the mechanism by which those lower energy bills pay the pensioners?
The owner of the flat pays some portion of the lower energy bill to the pensioner? The energy company charges the same amount and diverts some to the pensioner? The taxpayer pays the interest and capital back?
How does this work?
For extra points, once we’ve built that system that does the paying back then why do we need the compulsion of making pensions invest in it?
This is the problems with Spudda’s wand waving. He says “bonds”. OK, But who pays them back out of what revenue stream?