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Labour says budget watchdog OBR should begin climate modelling

From BBC - November 15, 2017

The financial risks posed by climate change should be included in future economic forecasts, Labour has said.

Shadow chancellor John McDonnell wants the Office for Budget Responsibility to model the effects of human-made climate change on the public finances.

In a speech in London, he said people had a right to know the financial cost of "environmental degradation".

Campaign groups welcomed the idea but the watchdog said it was up to Parliament to determine its remit.

The OBR's responsibilities and functions are set out in an Act of Parliament, passed in 2011 when the body was set up by the Conservative-Lib Dem coalition government.

As well as assessing the state of the UK economy and scrutinising government fiscal targets, it is required to produce a report every two years identifying the fiscal risks facing the UK.

Addressing the IPPR think tank, Mr McDonnell said a future Labour government would extend the OBR's remit to consider the impact of climate change, which he described as the UK's "greatest single public challenge".

On top of its other duties, he said the OBR - which is headed by economist Robert Chote - should become a "new centre of expertise for environmental macroeconomics".

"The truth is that meeting the challenge of climate will require more than marginal adjustments," he said. "It will require a transformation of our institutions and how our economies are run."

"We want to ensure that the overwhelming challenge of climate change is addressed from the very centre of government. This includes the potential losses to the public finances.

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