Conservative Party says it will axe the Climate Change Levy

The Climate Change Levy, designed as a means of meeting the emissions reductions targets agreed at Kyoto, will harm business and even damage the environment, according to the Conservative Party.


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Though the Conservative Party support the Kyoto targets, the Levy is one of a number of barriers to the competitiveness of UK businesses which, they say, they will abolish should they come to power. The energy tax, which is due to come into effect in April 2001 (see related story), will lead to Britain exporting jobs, and will make UK industry less competitive, say the Conservatives. Business would be lost to other countries whose environmental standards are often lower, and thus causing the global environment to suffer.

“We have been listening to the concerns of businesses, large and small, and as a result of what we have heard, we have put together this package, Keeping Britain Competitive,” said Shadow Chancellor, Michael Portillo. “Businesses are struggling under an extra £5 billion a year in increased red tape imposed by this government.”

Though revenue from the new tax will initially fund energy efficiency schemes, many firms will pay back more than they receive, say the Conservatives. This is a burden on business which has been opposed by every major business group (see related story), according to the Conservatives, quoting one study that found that the tax would cost 156,000 jobs over ten years. They also stated that it will cost car manufacturers £1 million each.

The Conservative’s alternative for the tax involves increased use of gas-fired electricity generation, and an emissions permit trading scheme which is used in the US. Together with voluntary agreements, backed up by sanctions where necessary, these measures will allow the UK to meet its international commitments without the need for a new energy tax with all its complexity, unfairness and industrial damage, say the Conservatives.

Environmental groups are not impressed by the Conservative’s announcement. According to Friends of the Earth (FoE), the proposal to scrap the Climate Change Levy is “a dangerous and ill-informed u-turn on the environment.”

“Scrapping the Levy would blow a huge hole in the UK’s programme to cut emissions of climate changing gases.” Said FoE Climate Campaigner Mark Johnston. “The Shadow Chancellor’s claim that it will make no serious contribution to achieving the UK’s international is just flat wrong. In fact this move would threaten pollution cuts of up to 4 million tonnes of greenhouse gases, about a third of the anticipated annual reductions.”

“Producing this half-baked idea in the run up to the General Election leaves the Conservatives environmental credentials in tatters. Instead they should look to the future, and develop policies to help British business capture a share in the emerging multi-billion pound market in new environmental technologies – protecting the environment, creating jobs and maintaining a prosperous economy.”

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