Labour must make the next election a ‘green election’

By Will Straw / @wdjstraw

The Guardian today reports that the Government will use the Pre-Budget Report to outline a policy of”protecting activities and priorities,” not budgets, in the effort to halve deficits over four years. It is a welcome change from Gordon Brown’s “no cuts” mantra that formed his strategy for the first part of this year and creates a useful dividing line with the Tories who are committed to protecting the £119 billion health budget and the £6 billion international development budget.

But it is critical that the Government also uses the PBR to focus on efforts to reduce Britain’s reliance on carbon. A triple whammy of political circumstances make this essential. First, as unemployment approaches 2.5 million there is a desperate need for the creation of new jobs, particularly in the hard hit construction and manufacturing sectors.

The focus of last December’s stimulus was the VAT tax cut, which cost £12 billion compared to just £1 billion for carbon reducing measures. In the US, by contrast, billion was spent on clean energy programmes effectively tripling the Department of Energy’s budget. It is estimated that these policies will create or save around 500,000 American jobs.

There are, of course, concerns about where the money for these initiatives would come from but there is plenty of low hanging fruit. For example, the Government is yet to adopt no-brainer schemes such as levying VAT on domestic flights. As well as raising revenue and incentivising the use of trains, the policy would be highly progressive.

Greenpeace reports that, “low-skilled people and people on benefits, despite making up a quarter of the population, only took 6% of those [210 million domestic and international] flights whilst the top quarter of the population took almost half of all flights.” Assuming an average one-way domestic journey costs £50, VAT on domestic flights would provide £210 milion for green jobs: not a huge sum but, on the logic of the US stimulus, enough to create or save a few thousand jobs.

Second, Britain will have more bargaining chips when the world’s major emitters meet in December in Copenhagen if proactive domestic efforts can be highlighted. Ed Miliband’s work in this area has been impressive and his harnessing of the campaigning community, with innovation’s such as Ed’s Pledge, is reminiscent of the successful Make Poverty History campaign of 2005.

But the Treasury must break precedent and ensure that Miliband is at the table when taxation decisions are made. The Government could take a leaf out of the Liberal Democrats book and consider a fundamental switch from taxes based on income to taxes on polluter behaviour. Their package adopted two years ago includes commitments to a more steeply graduated vehicle excise duty for new vehicles based on carbon emissions, the indexation of fuel duty to inflation except in periods of oil price spikes, and – perhaps most radically – the restructuring of the climate change levy as a tax on carbon across the economy.

Third, with an election approaching it is high time that David Cameron, who has not made a speech on the environment in 15 months, gave those nice Arctic Huskies some meat to accompany the bones of his environmental policy. And while the Tories campaign literature often claims that the electorate can “vote blue, go green,” there has been little to suggest that this is the case.

Two examples. During the industrial action on the Vestas plant, Cameron did not make a single statement. While it may be unfair to challenge his environmental credentials, the local MP on the Isle of Wight, Andrew Turner, had campaigned against the construction of wind farms on the island. John Sauven, executive director of Greenpeace, said that, “One of the reasons Britain’s green industrial revolution is yet to take off is the lack of domestic demand for wind turbines, and a key reason for that has been the attitude of many Conservative councils.”

Ditlev Engel, chief executive of Vestas, described Britain as “probably one of the most difficult places in the world to get permission”. Meanwhile, many in the right wing press are encouraging a climate of denial about global warming or seeking to scare people about the lifestyle impact of adopting renewables.

It is hard to underestimate the challenge posed by climate change. Labour, in Government, has already taken important steps such as the legally binding carbon budgets. But it has done so, like much of its progressive agenda, without fanfair. The strategy is wrong. Labour must put its climate agenda front and centre of its conversation with the British public and make this the first truly green election.