The UK budget announcement - the beginning of 'the greenest government ever'?
The UK's coalition government have today announced the budget for 2011 and the speech has revealed that some of the environmental policies once promised to the nation will be upheld. The Chancellor, George Osborne, previously promised that he would become an ally to green efforts and the Prime Minister David Cameron has made claims that this will be the ''greenest government ever.''
Among the environmental polices discussed at the start of the governments term were the creation of a Green Investment Bank (GIB) of which the plans were originally expected to be finalised by spring 2011, an air passenger duty and a tax on activities which produce a large amount of pollution (the carbon floor price)
The Green Investment Bank is a project for which both parties and subsequently the coalition were very enthusiastic and was very well received by green campaigners. It was imagined that the GIB would provide the funding needed to reform the UK's economy to make it low-carbon and more stable. However, due to the debt deficiency, those in control of the treasury originally stipulated that the GIB should not be allowed to borrow and should also be restricted in issuing common bank services such as ISA's and bonds, for fears that it would add to the national debt. Many people believed that this would render the GIB ineffective and unable to fulfil many of the purposes it was created for.
However, it has just been announced that in 2015/16 the GIB will be allowed to borrow and invest, subject to the debt target being met. Also, Osborne has pledged that a further £2 billion will be given to the GIB which will come from assets sales and will be underwritten by the treasury. This is a good result for the UK as it means that many of the pledges made concerning environmental issues are likely to be upheld and hopefully it will increase private sector funding in green projects and technologies.
It has also been announced in the budget speech that the carbon floor price tax will be implemented and will start at £16 per tonne of carbon dioxide by 2016 which will rise to £30 per tonne by 2030. This will be combined with a further increase in green taxes in general as previously promised.
More information regarding these policies is expected to be released in greater detail very shortly and it is hoped that the changes to the economy will be visible over the next few years. However, as a starting point the announcements made in the budget speech look promising for creating 'the greenest government ever'.