{"id":61871,"date":"2022-03-04T08:23:01","date_gmt":"2022-03-04T08:23:01","guid":{"rendered":"https:\/\/www.taxresearch.org.uk\/Blog\/?p=61871"},"modified":"2022-03-04T08:23:01","modified_gmt":"2022-03-04T08:23:01","slug":"the-uk-government-is-falling-way-short-in-its-planning-for-climate-change-war-cannot-be-used-as-an-excuse-for-not-doing-better-this-too-is-an-existential-threat","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2022\/03\/04\/the-uk-government-is-falling-way-short-in-its-planning-for-climate-change-war-cannot-be-used-as-an-excuse-for-not-doing-better-this-too-is-an-existential-threat\/","title":{"rendered":"The UK government is falling way short in its planning for climate change. War cannot be used as an excuse for not doing better. This too is an existential threat"},"content":{"rendered":"

Two parliamentary reports this week tell the same story about the government's preparedness for climate change.<\/p>\n

As the FT notes<\/a> this morning:<\/p>\n

The UK will miss its net zero carbon targets because the government has failed to introduce \u201ccredible plans\u201d to drive investment in key alternative technologies, such as heat pumps, a parliamentary report has warned.<\/p><\/blockquote>\n

The House of Commons Public Accounts Committee made the same point<\/a> earlier this week in a powerful report, the first major suggestion from which read as follows, and I make no apology for reproducing it in full:<\/p>\n

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Government has\u00a0<\/strong><\/strong>no clear plan for how the transition to net Zero\u00a0<\/strong><\/strong>will be funded.<\/strong><\/strong>\u00a0Its ability to track its performance against the 2050 target is hampered by vague performance measures, a lack of overall budget or plans to collate and report what it is spending and limited assessment of the cost impact on consumers.<\/strong><\/p>\n

Currently, the government does not plan to report spending in pursuit of its net zero objectives, which the Department considers may be challenging to separate from other costs. While we acknowledge the challenge, which will increase over time as behavioural changes are embedded, this should definitely not be a reason for the Department, working with HM Treasury, to shy away from tracking and reporting public money spent on achieving its net zero objectives and outcomes achieved. For example, the NAO overcame similar challenges to create its Covid Cost Tracker. In addition, some of the net zero measures are cast as best endeavours \u201cas many as possible\u201d or \u201cas many\u2026as reasonably practicable\u201d. These features will make any assessment of progress less transparent and more challenging.<\/p>\n

HM Treasury was reluctant to be drawn on the future costs of achieving net zero, cautioning that while the Climate Change Committee has provided estimates, they contain \u2018heroic assumptions\u2019 with errors potentially compounding over very long periods.1<\/a><\/sup>\u00a0To publish policy without commensurate funding merely amounts to an aspiration not a real intention by government. At a time when people are worried about their energy bills, government must be clearer about the costs facing consumers, households and business of achieving its net zero objectives. Our previous work on green taxation did not give us any confidence that there is a clear plan, and we highlighted our concern that HM Treasury and HM Revenues & Customs (HMRC) have taken a very limited view of tax so far and could not clearly explain to us how the tax system is to be used in achieving the government\u2019s environmental goals. One example is government\u2019s goal of increasing ownership of electric vehicles, which requires HM Treasury to take account of Fuel Duty and Vehicle Excise Duty receipts forgone and provide clarity on how these impacts on the consumer and Exchequer will be managed. At present HMRC and HM Treasury only recognise four environmental taxes as these are the only ones with specific environmental objectives. They have focussed on the revenue these taxes raise but have not kept track of the impact of other taxes such as tax reliefs to support energy saving and clean technologies, or the impact of tax measures affecting the consumption of fossil fuels. We were encouraged to hear that the departments have started to assess the impact of fuel duty freezes on the environment, but environmental assessments should be made for all taxes.<\/p>\n

Recommendations:<\/strong>\u00a0Alongside the Treasury Minute response, the Department and HM Treasury should write to the Committee setting out in detail how it will report progress in implementing its net zero policies, including:<\/p>\n