Ministers brace for backlash after COP27 summit agrees ‘loss and damage’ fund

Ministers are bracing for a backlash today after the COP27 summit agreed a ‘loss and damage’ fund to compensate countries hammered by climate change.

The mechanism was signed off in principle at the UN gathering in Egypt in the early hours of the morning, but Tories have already lashed out at the idea of the UK paying ‘reparations’.  

Developed nations have long resisted calls for payments to account for rising sea levels and extreme weather caused by historic carbon emissions.

They have insisted that funding should focus on helping populations adapt to climate change.   

However, states that industrialised later from Asia, Africa, Latin America, the Caribbean and the South Pacific have argued that they are suffering the consequences without contributing to the problems. 

It is not clear what countries will receive funding, how much, and who will contribute – although it is thought that China will not be putting into the pot. 

The ‘loss and damage’ mechanism was signed off at the UN gathering in Egypt in the early hours of the morning

Rishi Sunak (pictured) has denied that a ‘loss and damage’ fund would be the equivalent to ‘reparations’ for past carbon emissions

Tories have already lashed out at the idea of the UK paying ‘reparations’ for historic carbon emissions

Earlier this month Rishi Sunak said he was ‘pleased’ there was a ‘dialogue’ on ‘loss and damage’.

He told MPs the summit would ‘discuss arrangements for funding activities to avert, minimise and address loss and damage’.

But the PM denied that a ‘loss and damage’ fund would be the equivalent to ‘reparations’ for past carbon emissions.

Boris Johnson told a fringe event at the summit that Britain ‘simply doesn’t have the financial resources’ to pay reparations and ‘no country does’.

While admitting that the UK had contributed vast carbon emissions, he argued that the focus should be on finding private investment and technological solutions. ‘Let’s look to the future,’ he added.

Former Cabinet minister Jacob Rees-Mogg has argued that Britain’s industrialisation ‘brought prosperity to the world’.

‘There is no need to pay reparations. Our leadership of the industrial revolution brought prosperity to the world and led to increased life expectancy and better living conditions,’ he tweeted earlier this month.

However, Nicola Sturgeon’s Scottish Government used the summit to announce an extra £5milllion in ‘loss and damage’ cash for climate-hit communites.

Austria also pledged ‘loss and damage’ money at the Egypt conference, with a commitment of at least 50 million euros over the next four years.

Belgium, Denmark and Germany have also pledged small amounts of funding for ‘loss and damage’.

Wrangling is now expected over who pays what – which could well mean nothing is finalised for years.

According to the agreement, the fund would initially draw on contributions from developed countries and other private and public sources such as international financial institutions.

While major emerging economies such as China would not automatically have to contribute, the option remains on the table. That was is a key demand by Western states, who argued that Beijing and other large polluters have the financial clout to pay their way.

The fund would be largely aimed at the most vulnerable nations, though there would be room for middle-income countries that are severely battered by climate disasters to get aid.

If a Republican like Ron DeSantis ends up winning the presidency, the fund could face being scrapped again. 

Donald Trump pulled the US out of the 2015 UN Paris Accord on climate change, saying it represented a bad deal for America – with Mr DeSantis known to share many of the 45th president’s views. 

China – currently the world’s biggest polluter – is still considered a developing nation, despite its vast economy. 

China is not expected to contribute to any ‘loss and damage’ fund, because it is still considered a developing nation