Archived press release

Pre-budget report fails deliver green new deal

24 November 2008

The Chancellor's Pre-Budget Report has fallen a long way short of leading Britain out of the economic downturn by investing in a low carbon economy, Friends of the Earth said today (Monday 24 November 2008).

The environmental campaign group welcomed investment in insulating homes and buildings and funding for new trains - but said the Government proposals only scratch the surface of what is required to simultaneously tackle the enormous economic and environmental challenges that Britain faces.

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

"The Government has dodged a golden opportunity to kill two birds with one stone by using the Pre-Budget Report to tackle both the economic downturn and global climate change."

"Creating new jobs by insulating homes is a step in the right direction. But political ambition, of speed and scale equal to that shown in the economic crisis, is urgently needed to tackle global climate change and safeguard a clean and prosperous future for us all."

"Ministers should have gone much further to slash energy waste and develop the UK's massive renewable energy potential."

"This could create exciting new business opportunities and tens of thousands of jobs - as well as slashing fuel bills and greenhouse gas emissions."

"Increased public borrowing must be invested in creating a successful, low- carbon economy, instead of blowing it on a spending spree that won't avoid the climate change collision course we are currently on."

"Time is running out - the Government must show much greater ambition in its Budget next Spring."

Friends of the Earth had urged the Government to announce a Green New Deal in today's Pre-Budget Report by investing in safe, clean sources of renewable power and tackling energy waste in transport, manufacturing and buildings. The environmental campaign urged him to go much further in the 2009 Budget.

This month's Pre-Budget Report is the first since the Government committed itself to a new law requiring the UK to cut its greenhouse gas emissions by 80 per cent by 2050 - which is due to get Royal Assent later this week - and the first since the inevitability of the forthcoming recession. The successful bid for a climate change law was led by Friends of the Earth through its Big Ask campaign.

The Climate Change Committee is due to publish its recommendation for the first three climate change 'budgets' - each lasting five years - on 1 December. These interim targets, which are part of the government's new law on climate change - are meant to ensure that the 2050 target is kept on track. The economic Budget must ensure that Britain's environmental budgets are met.

Notes:

1. Friends of the Earth called for the Pre-Budget Report to prioritise support for a low carbon future. Measures could have included:
• A comprehensive street-by-street home insulation programme across the UK - with priority given to those who can't afford to heat and power their homes.
This will cut fuel bills and emissions, create jobs, increase energy security and tackle climate change. This should be kick-started by a one-off £5 billion tax on the windfall profits of energy companies.

• A commitment to a five-fold increase (above those currently proposed by the Government) in investment into renewable energy R&D and deployment. This will attract investment to the UK in the fastest growing global industries and create tens of thousands of jobs in manufacturing, construction, maintenance and administration. It should be paid for by re-directing public spending and the auctioning of carbon emissions permits under the Emissions Trading Scheme.

• A shift of business taxation from employment and to energy waste. An increase in the climate change levy would pay for a cut in employers national insurance contributions. The Carbon Trust recently found that British businesses could save themselves £2.5 billion over the next 12 months - the equivalent of 100,000 staff salaries - if they implemented energy efficiency schemes. Cuts in employers' National Insurance Contributions would help small and medium sized firms in particular.

• Standing firm on plans to cut emissions from the transport sector. This means sticking to its proposals to: increase taxation on gas-guzzling vehicles; increase fuel duty in April; and introduce Aviation Duty - which will also cover freight and 'transfer' passengers.

• Commit the Government to staying within the UK's new carbon budget - which is due to be announced in spring 2009 - entirely through strategic low-carbon investment and greater energy efficiency in the UK economy. Importing credits from abroad will result in the UK economy being left behind other nations and missing out on the economic benefits of investment and jobs.

2. In a key-note foreign affairs speech earlier this month, Gordon Brown indicated that he believed that a new approach was needed to both the economy and the environment. He said "we must use the imperative to act for our future prosperity through the transition to a low carbon economy and reduced oil dependency as a route to creating jobs and economic opportunity for our peoples today." See: http://www.number10.gov.uk/Page17419

3. Friends of the Earth is a member of the Stop Climate Chaos Coalition, the UK's largest group of people dedicated to action on climate change.

If you're a journalist looking for press information please contact the Friends of the Earth media team on 020 7566 1649.

Published by Friends of the Earth Trust