Fairness must drive Seventh Carbon Budget plans, MPs tell Government

Fairness is “fundamental” to the legitimacy of the Seventh Carbon Budget and failure to deliver even benefits to all could put public consent at risk, MPs have warned in a report launched today.

Where the costs of cutting emissions are experienced early and unevenly, while benefits arrive later or are less visible, public consent for net zero cannot be assumed, the Environmental Audit Committee says. 

The Committee also warns that mixed policy signals, including proposals to introduce pay-per-mile charging for electric vehicles, risk weakening public and investor confidence, while contradictory decisions such as airport expansion must be transparently reconciled with the pathway required to meet the UK's legally binding environmental targets. 

These misaligned choices signal that net zero is a “conditional ambition rather than a binding national obligation”, MPs warn and would slow the uptake of low-carbon technologies, deter investment and undermine confidence net zero. 

The Environmental Audit Committee was invited by the Government to assess the Climate Change Committee advice for the UK's Seventh Carbon Budget (CB7) proposals, covering the years 2038-2042. Carbon Budgets, established by the Climate Change Act 2008, cap the total greenhouse gases the UK can emit over five-year periods.

The Committee has today published its report exploring the Government's options for maintaining the path of cutting emissions towards net zero, which must be set in law by 30th June 2026.  

Cutting emissions to net zero is essential to preventing further global warming and limiting the most severe impacts of climate change, according the UN Intergovernmental Panel on Climate Change. But the Committee warns that the pathway to net zero could be at risk without long-term certainty and coordinated Government delivery, as well as behaviour change from the public. 

Fairness is “fundamental” to delivering CB7, MPs find, recommending that the Government address the imbalance between electricity and gas prices by removing appropriate policy costs from electricity bills and funding them through general taxation. This would strengthen incentives to electrify heat and transport, while reducing the risk that households unable to switch away from gas bear disproportionate costs.'

It should also publish an assessment of which groups are at risk of disproportionate costs, including workers whose jobs are displaced by the transition, and the measures in place to support them. 

CB7 will depend on policies that tangibly improve everyday lives, MPs say; warmer homes, lower running costs, cleaner air and better local environments are not “ancillary benefits”, but “essential delivery mechanisms”. Policies intended to drive behaviour change should be designed from the outset to improve affordability, health outcomes, air quality and local environments. 

The Department for Energy Security and Net Zero should provide visible cross-government leadership by setting out how departmental policies collectively support delivery of CB7, the Committee recommends. But this also needs to be explicitly backed by the Prime Minister and Chancellor through public statements, clear steers, and providing resources to ensure departments work together. 

Since September 2025, the Committee has been examining how the Government should approach its plans for CB7. It has considered the level of the budget, how it will be delivered across government and local government, the challenges facing particular sectors, and the role of fairness and consent in behaviour change.  

Alongside written evidence, the Committee also held roundtable discussions with representatives of sectors across the UK economy, to understand what challenges and opportunities the Government would face in delivering the carbon budget. 

In the report, the Committee warns against confusing decarbonisation with deindustrialisation; allowing production to relocate abroad would weaken the UK's industrial base while doing little to reduce global emissions. It calls for ministers to clearly set out how CB7 will prevent the offshoring of emissions and support domestic decarbonisation in energy-intensive and trade-exposed sectors. 

In its advice for the Seventh Carbon Budget (CB7) the Climate Change Committee advised CB7 be set at the “ambitious but deliverable” level of 535 million tonnes of carbon dioxide equivalent (MtCO2e). This level is technically credible, the Committee finds, but will require tough political decisions as the ‘low hanging fruit' of decarbonisation have largely been achieved. Reducing emissions will become more complex, more capital-intensive and more dependent on coordinated action across infrastructure, markets and behaviour.

Chair comment

“Carbon Budget Seven is a pivotal moment in the path to cutting emissions to net zero. With the easy pickings of decarbonisation largely delivered, the measures still to come will impact our daily lives more than ever. How we travel, heat our homes and power our technology will all be affected.

Public backing for net zero cannot be taken for granted. If CB7 is to succeed, it will be because it was affordable, convenient and attractive for the public, as well as environmentally necessary. To sustain confidence, the Government must renew its own commitment to affordability by addressing the structural imbalances that currently push up the cost of electricity.

At the same time, cross-party consensus on net zero has fractured, and different government departments appear to pull in different directions. As ordinary people increasingly feel the pinch, and decisions become more difficult, ensuring the transition is fair and just has never been more important.

Ministers must also defend the net zero agenda explicitly and proactively, making clear how the Government as a whole is pushing towards a common goal. Cutting emissions to net zero is essential to preventing further climate change. The Prime Minister and Chancellor must make the case from the very heart of government. 

Get the Seventh Carbon Budget right, and there will be serious rewards: warmer homes, lower running costs, cleaner air and better local environments. Bringing the public with us, by prioritising fairness and making clear the positives, is essential, not an optional add-on.”