Budget fails to fund fair future
The much needed and much delayed Green Investment Bank got an extra £2bn in the Chancellor’s budget, but will be without lending powers until 2015. This effectively renders it a £3bn fund rather than a bank until then, with capital far short of the hundreds of billions that need to be mobilised for the transition to a green economy.
Francis Stuart, Friends of the Earth Scotland’s Parliamentary and Policy Officer, said: “Preventing the Green Investment Bank having proper borrowing and lending powers until 2015 undermines its purpose – to be a bank – from the very beginning.
“What’s perverse is that Treasury officials in Whitehall seem to have won the argument that the Bank would add to the national debt. Yet we know that any money out would have to be balanced by money in, so while net debt may increase, the net deficit won’t.
“Once again this would seem to be an administration putting an ideological cuts agenda above its greenest government ever promise.”
The government cut fuel duty by a penny and committed itself to a fuel stabiliser – cutting duty on fuel as the price of oil goes up. Yet a more responsible, future-proof step that could actually safeguard family finances would be to acknowledge that we cannot continue to rely on fossil fuels.
Francis Stuart said: “As the Chancellor admitted himself oil prices have risen 35% over the past 5 months. In the long term the only way to combat this is to reduce our dependence on oil.
“Rather than cutting petrol costs by a few pence, the Government should be taking dirty oil money and investing in the clean, green infrastructure needed to give everyone sustainable travel choices.”
The government announced a carbon floor price, with the aim of encouraging new investment in low-carbon electricity. The price is to be set at £16 per tonne in 2013 and £30 per tonne in 2020. Yet existing nuclear generators will be the main beneficiaries of this scheme and without complimentary policies such as a strong Emissions Performance Standard, it will fail to support the clean, green renewable projects that we need. It also brings into question the Government’s commitment not to provide public subsidy for new nuclear.
Francis Stuart said:
“The carbon floor price could have played a role in moving the UK to a more low-carbon economy. Unfortunately this announcement will provide windfall profits to the nuclear industry. Unless the Government brings in an immediate windfall tax this will fly in the face of the Government commitment not to provide public subsidy to new nuclear.
Supporters of nuclear energy constantly argue that renewables receive unfair subsidies. At least renewables subsidies are transparent. The nuclear industry benefits from opaque schemes like this that effectively fund a high cost, high risk, unwanted, uneconomic technology.”
For media enquiries, please contact:
Per Fischer, Press Office, Friends of the Earth Scotland
t: 0131 243 2719
Notes to Editors
A Friends of the Earth briefing on fuel prices, transport and climate change is available for download: www.foe.co.uk/resource/briefings/fuel_tax.pdf
Between 1997 and 2010 the overall cost of motoring, including the purchase of a vehicle, fell by 7% while the bus and coach fares increased by 24% and rail fares increased by 17%: www.foe.co.uk/resource/press_releases/transport_fares_car_dependency_010…
According to the Conservative Party’s consultation document from 2008, a fuel price stabiliser will reduce the shock of oil price spikes but it will still allow prices at the pumps to rise: bit.ly/eQOvak
A report by The Green Alliance says a stabiliser could knock a huge hole in public finances: bit.ly/e3RfLg
Friends of the Earth Scotland exists to help people in Scotland look after the planet for everyone’s future. We think globally and act locally in Scotland, delivering solutions to climate change by enabling and empowering people to take both individual and collective action. We offer help to people with the big things in life – helping to sustain a healthy society and environment. We believe that all of our children’s futures will be better because of what we do. www.foe-scotland.org.uk