Key environmental points in budget:
- Scale and scope of the Green Investment Bank
- Details surrounding the introduction of a new floor price for carbon
- Changes to transport policy – fuel duty and APD
Overarching view:
Executive director of Greenpeace, John Sauven, said:
“The Prime Minister claimed he would lead the greenest government ever, but George Osborne and his officials have crafted a budget that sabotages that ambition. There’s almost nothing in this budget to protect the environment and spark a clean-tech jobs boom. David Cameron now needs to seize the wheel and change the direction of his government. As things stand he’ll leave office with Britain still hooked on oil and China and California surging ahead in the race to build the low carbon technologies that should be developed here at home.”
Sauven added:
“We’re lurching from one energy crisis to the next, with the last year alone seeing the BP oil spill, price spikes from Middle East unrest, the inexorable effects of climate change on our fragile environment, and the nuclear disaster in Japan. Today could have been the day a British government finally made the leap and committed to a different future in which our energy is clean, inexhaustible and home-grown. George Osborne blew it.”
On the Green Investment Bank:
Key points:
- Bank won’t be able to borrow until 2015/2016 and only then if national debt target is met
- Bank will get initial capitalisation of £3 bn and be able to leverage £15bn in private capital
- Bank will come into effect in 2012
- Greenpeace believes the only Bank structure capable of leveraging the £450 billion investment Ernst and Young analysis shows is needed for low carbon infrastructure up to 2025, is a state backed Bank capitalised with an initial £4-6bn public funds and that is capable of borrowing and issuing bonds and loans straight away
Dr Doug Parr, Policy Director at Greenpeace, said:
“In making the case for the Bank, Chris Huhne recently said ‘ducks quack, and banks borrow as well as lend.’ Well, the Bank unveiled by George Osborne is a lame duck. The refusal to allow it to borrow money anytime soon represents a huge missed opportunity with the price being paid in lost green growth and clean-tech jobs. The Chancellor appears more wedded to Treasury ideology than delivering on the Prime Minister’s promise to lead the greenest government ever.”
On the floor price for carbon:
Key points:
- Carbon price will be set initially at £16 per tonne and rise to £30 per tonne in 2020
- This will offer windfall to nuclear industry for their existing nuclear power stations
Policy director of Greenpeace, Dr Doug Parr, said:
“The carbon floor price will put up bills, deliver a windfall profit for existing nuclear power stations and yet it won’t drive investment into clean energy and improved efficiency. It’s not so much a green tax as a stealth tax and it’s exactly the sort of measure that gives green levies a bad name.”
On transport policy:
Key points:
- Fuel duty escalator cancelled
- Fuel duty cut by 1p per litre
- Introduction of a fuel price stabiliser
- Decision to delay rise in air passenger duty
- No introduction of coalition pledge to introduce a per plane levy
Head of the climate campaign for Greenpeace, Jim Footner, said:
“The era of cheap oil is over, high prices are here to stay, so the imposition of a fuel duty stabiliser will do nothing to deal with the root cause of our fuel price problems - our addiction to oil. This budget is likely to hamper investment in cleaner and more efficient cars, in the long run making drivers more vulnerable to global oil price spikes. By increasing the duty on oil producers the Chancellor has merely shifted the tax burden up the pipeline. Drivers will keep paying over the odds to fill their tanks until we get off oil and develop a transport system that’s not dependent on an expensive dirty fuel that’s running out.”
Greenpeace transport campaigner, Vicky Wyatt, said:
“Freezing Air Passenger Duty will have no significant effect on people’s wallets but is just the latest example of the aviation industry getting special treatment despite flying being the most polluting way to travel. If the Chancellor was serious about making transport greener, he would be cutting rail fares, not taking a quid off the cost of a flight to Paris.”
In the long term emissions from aviation are growing faster than any other sector of the UK economy. Greenpeace believes that if the government was serious about tackling aviation emissions it would commit to raising the existing passenger duty every year at a rate well above inflation and encourage EU countries to introduce similar taxes as Germany and Austria have recently done.
Greenpeace Press Office: 020 7865 8255
For examples of Osborne’s promises on the environment see: http://www.greenpeace.org.uk/blog/climate/georges-top-10-green-promises-20101019
