CCC: Change tax systems to build green economic recovery post-coronavirus

The Committee on Climate Change (CCC) has advised Prime Minister Boris Johnson, COP26 President Alok Sharma and national first ministers across the UK, calling for climate action to be placed at the heart of an economic rebuild following the coronavirus pandemic.

CCC: Change tax systems to build green economic recovery post-coronavirus

The CCC believes that the government can lead a shift to new social norms

The CCC’s letter sets out six key focus points that the climate watchdog wants the UK to focus on when attempting to spur economic growth and national recovery following the Covid-19 pandemic.

The Committee calls on the Government to “avoid locking-in higher emissions or increased vulnerability to climate change in the longer-term”, notably by strengthening incentives to reduce emissions or by considering changes to the tax system.

The CCC wants investments to focus on the net-zero transition to help support economic recovery and support green job growth. Stronger policies to reduce vulnerability to future risks of climate change are also required to “avoid a disorderly transition” to the UK’s net-zero target for 2050.

“The pandemic is a sharp reminder that the world’s most challenging crises do not respect borders and require strong collaborative global action. As president of the COP26 UN climate talks in Glasgow and with incoming presidencies of the G7 and G20 the UK, together with Italy, can help to steer a positive global response,” the letter states.

“Our international climate programme on both mitigation and adaptation will be more important than ever. Our credibility as an international leader rests on taking action at home.”

The CCC believes that the government can lead a shift to new social norms, including supporting home working and remote medical consultations as well as improved safety for cycling.

The cost of doing so, the letter says, must not burden those least able to pay for it, echoing calls for a fair and “just” societal shift to net-zero emissions. The CCC’s annual progress report to Parliament in June will feature rebuilding efforts for the economy and production in a way that supports a “just” transition towards net-zero emissions.

CCC Chairman, Lord Deben, said: “The Covid-19 crisis has shown the importance of planning well for the risks the country faces. Recovery means investing in new jobs, cleaner air and improved health. The actions needed to tackle climate change are central to rebuilding our economy. The Government must prioritise actions that reduce climate risks and avoid measures that lock-in higher emissions.”

Economic change

The 2008-09 financial crisis was built on stimulus packages that led to global emissions rebounding after an initial fall. Fossil fuel firms were able to gain access to subsidies and support packages, but did little to decarbonise their business models.

Campaigning groups have called for any Government bailout of airline companies, for example, to include conditional links for worker rights, fair taxing systems and transparent action plans on climate change. These calls have largely been ignored by policymakers.

The CCC has confirmed that its advice on the Sixth Carbon Budget, which covers the reduction levels required for the period of 2033-2027 will now be published in December 2020, rather than September. The CCC claims this will allow for extra time to complete the analysis in a way that reflects on the current impacts of the coronavirus.

It will be the first carbon budget to be created since the UK legislated for net-zero, with all other carbon budgets to date having been developed in line with the 2008 Climate Change Act’s original 2050 target of an 80% reduction in GHG emissions, against a 1990 baseline.

Chair of the CCC’s Adaptation Committee, Baroness Brown of Cambridge, said: “This pandemic has shown that global risks need global solutions. As President of next year’s pivotal COP26 climate summit, the UK now finds itself in a unique position to ramp-up climate action at home and supercharge the international response to climate change abroad. The risks we face as a globalised society are now in sharp focus – for their part, UK leaders must act decisively on a climate-resilient recovery, and do so together.”

Commenting on the letter, Mike Childs, head of science at Friends of the Earth, said:

“Spring 2020 will be a catalyst for change, but what sort? Will we return to the damaging parts of the old normal, or build back better so that the next normal improves the health of people and planet?

“Improving people’s lives and saving the climate needs to be central to recovery, not rebuilding the profits of damaging industries. The CCC recognise this, embedding fairness and support for transformative government action and leadership into their report…The right post-pandemic investment can push a big, positive, reset button on our carbon-guzzling and unsustainable economy and build a clean, healthy and fair world.”

Matt Mace

Comments (2)

  1. Keiron Shatwell says:

    We have been given a unique opportunity to radically reshape our lives. Not only for our own benefits by rebalancing the "work life" balance and focussing our minds on what is actually important but by changing the way we go about our business.

    If we fail to build on what this virus has presented us we have failed our children. Reduce the road building plans and swap that for improved Active Travel options, including properly segregated cycle ways and improving the nations broadband connectivity (no where should be a "not spot"). Encourage flexible working and working from home or distance working (do companies need a massive office in a city, could they have more regional offices??).

    We have an unprecedented opportunity to rip up Tolly’s 22,000 page tax code and replace it with something simpler, fairer and greener to help every person and every business rebuild

  2. Colin Megson says:

    …The cost of doing so, the letter says, must not burden those least able to pay for it, echoing calls for a fair and just societal shift to net-zero emissions…".

    Renewables occupy the high ground in all recommendations to Government, from the CCC and others. But now, renewables, combined with green hydrogen manufacture, is a bandwagon starting to roll at ever increasing speed with every day that passes.

    Green hydrogen is the only technology that can actually solve the ‘Intermittency Problem’, deliver 24/7/365 electricity and also completely replace natural gas in heating and petroleum in all forms of transport and industrial processes.

    The powerful and well financed renewable lobbyists will put maximum effort into ensuring this linkage works and they’ll do it by ‘selling’ their otherwise dumped oversupply of electricity at marginal, or even zero, cost to the electrolyser operators. In fact they’re so good at spinning to gullible politicians, it would not surprise me if they are persuaded to hand out constraint money (from our bills and taxes) to the plant operators.

    But this completely ignores burgeoning developments in advanced nuclear power plants. This simple combination of a total energy system comprising low carbon electricity generation and green hydrogen allows a simple analysis of the cost of the renewables path, versus the advanced nuclear path.

    Starting in 2020, to decarbonise the UK’s energy use, a possible combination of biomass, wind and solar would cost 170 billion every year, for the 30 years to 2050. That’s 6% of GDP, which would bankrupt any nation.

    Starting in 2030, advanced nuclear would cost 50 billion every year, for the 20 years to 2050. That’s 2% of GDP and manageable.

    Now which one would not burden those least able to pay? A real head-scratcher.

    Search for: bwrx-300 remember the name

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