Archived press release

A green budget could slash £9bn off UK debt this year

17 June 2010

A green approach to cutting the deficit could wipe £9 billion off the UK's debt this year, Friends of the Earth said today. The environmental charity is urging the Chancellor to help deliver on David Cameron's pledge to lead the greenest Government ever.

Ditching proposals for expensive new roads would save £4.5 billion, while reforming aviation duties and introducing a Robin Hood Tax on major sterling transactions would raise a further £4.5 billion a year.

And investment in a clean, green future would save individuals and businesses money, create jobs and help the UK become a market leader in renewable technologies.

Friends of the Earth is calling for the Government to make it easier for people to cut carbon emissions, through measures like a Stamp Duty rebate for households who make their new homes energy efficient.

Supporting green schemes such as home insulation would create jobs, reduce fuel bills so families have more cash to spend on goods and services, improve public health and bring down NHS costs - almost one in five homes are currently classified as 'excessively cold'.

The charity is also calling for the Government to set up its proposed Green Investment Bank within a year, to provide essential funding for low-carbon industries and ensure UK businesses reap the benefits of a green manufacturing boom.

Friends of the Earth's Executive Director Andy Atkins said:

"Tackling climate change must be at the heart of plans to cut the deficit and safeguard a healthy future for everyone.

"Increasing taxes on pollution can reduce the need for spending cuts to frontline services - the percentage of taxes coming from pollution is lower now than in 1997.

"The Government should seize the opportunity to develop new green jobs and business opportunities, so the UK doesn't miss out on its share of this rapidly growing sector.

"The cost of switching to a low-carbon economy now is far less than the bill we'll face if we delay action on climate change."

Notes to editors:

1. Taxes on pollution fell under Labour, despite promises to increase them. In
2009 taxes on pollution accounted for 8.2 per cent of total taxes, 2.8 per cent of GDP. In 1997 the equivalent figures were 9.4 per cent and 3.3 per cent.
http://www.statistics.gov.uk/StatBase/Product.asp?vlnk=3698&Pos=6&ColRank=1&Rank=272. The Green Fiscal Commission advocate this should be 20 per cent of total taxes by 2020.

2. You can see Friends of the Earth's Budget briefing in detail here:
http://www.foe.co.uk/resource/briefings/budget_june_2010.pdf

3. Friends of the Earth is one of 110 organisations supporting a Robin Hood Tax on financial currency transactions. Half the sum raised would be used to combat the domestic deficit, and the rest to help developing countries fight climate change and alleviate poverty. http://robinhoodtax.org.uk

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Published by Friends of the Earth Trust