|October 30, 2006|
Economy faces climate 'calamity' says 700 page Stern Report
|London, UK (by Joe Murphy "Evening Standard") -- A 700-page Government report on climate change has predicted the 'biggest global economic crash since the 1930s' - paving the way for a host of new green taxes.|
Tony Blair today warned the planet was 'on the edge of calamity' and paved the way for new taxes on motoring and air travel.
Heavy taxes being pushed for by ministers include VAT on airline tickets, duty on aviation fuel and higher air passenger duty - together raising the price of a typical family flying abroad by 20% or more.
With bigger taxes on motoring, the annual cost to families if all the schemes being discussed by ministers go ahead could be more than £1,000 a year.
However, for the least-green households, the tax penalty could be even more severe. A London family of four that has a 4x4 on the drive, keeps the heating turned high, has a gas heater in the garden and takes cheap flights abroad each year can expect to be hit by £2,000 more in duties.
Launching the 700-page Stern Report into climate change, the Prime Minister said people had no choice but to make sacrifices or face disaster. 'This report will be seen as a landmark in the struggle against climate change,î Mr Blair said.
'It reinforces the overwhelming scientific view that our planet is on the edge of calamity. It also gives us the clearest evidence yet that bold and decisive action can still prevent it.î
He and Gordon Brown stood shoulder to shoulder to launch the findings of Sir Nicholas Stern's widely-leaked report, the most comprehensive study yet into the potential effects of global warming.
The Chancellor has conspicuously refused to rule out using his Budget to impose hefty new taxes on petrol, flights and gas guzzling cars.
A range of possible taxes to punish domestic carbon polluters were proposed in a leaked submission to the Treasury from Environment Secretary David Miliband.
They included the return of the unpopular fuel escalator - annual petrol duty rises - which sparked the fuel protests in 2000 and taxes worth around 10p per litre.
Other measures were pay-per-mile road charges; taxes on inefficient domestic appliances, such as old-fashioned dishwashers; duties on aviation fuel, a higher air passenger levy and more charges for household rubbish.
CLIMATE CHANGE BY NUMBERS
There was speculation the leak was part of a 'kite-flying' exercise to see if voters responded angrily or could be softened up.
Both he and Mr Brown emphasised the need for international action, saying that without China, India and the United States joining in nothing would be achievable.
The Chancellor revealed that former US vice-president Al Gore - now a prominent environmental campaigner - has agreed to be his adviser on the issue.
Mr Brown strongly backed Sir Nicholas's call for an international carbon-trading scheme, in which companies would get permits to produce a certain amount of pollution.
These permission's could then be traded, so that clean technologies would be rewarded and dirty producers would face higher costs.
'Above all Sir Nicholas Stern's report sees climate change as a global challenge that demands a global solution', Mr Brown will say. 'The truth is: we must tackle climate change internationally or we will not tackle it at all. Britain will lead this global effort.î
The EU already has a fledgling carbon trading market, where a tonne of carbon emissions currently cost around 11.75 euros.
The Government hopes to hijack the bandwagon and make London the world's main exchange centre for a market that Sir Nicholas estimates will be worth $70bn in four years' time - more than aerospace and pharmaceuticals put together.
Sir Nicholas, the former chief economist at the World Bank, began work in July last year and his study was received as the most comprehensive work on the economics of climate change - both the impact it will have on wealth-creation and the way it can be tackled by harnessing the power of markets. Its main points are:
Tory leader David Cameron said he would be prepared to tax air travel and bigger cars. Liberal Democrat leader Sir Menzies Campbell said: 'We have absolutely no option but to deal with the problem of climate change and nothing but hard choices will do it.'
Sir Nicholas today said families must accept the need to pay through higher prices. 'It is consumers and households that ultimately pay', he said on BBC Radio 4. 'They will pay just 1% more on average for their consumer activities.'
What Miliband proposes
Automatic increases even if oil prices fall. The annual fuel duty escalator, abolished after protests in 2000, would be restored. That could mean 10p on a litre of fuel, costing the driver doing 15,000 miles a year some £260 a year.
Pricing should 'reflect the full environmental impact of the journey made'. A 2p per mile charge would cost £300 a year for a 15,000-miles-a-year driver.
£5 increase in air passenger duty, raising £400 million a year; VAT on ticket prices; taxing aviation fuel to be considered. Means cost of a family holiday to the Mediterranean could rise by up to £130.
'Differential charging' for household waste, leading to greater use of microchips in wheelie bins to spy on rubbish. Penalties for not recycling, fears that council tax will have to rise.
Taxes on energy-wasting white goods and lighting products - could mean a £50 levy on wasteful appliances and a £1.50 charge added to non-green lightbulbs.
'Substantial increase' in road tax for inefficient 4x4s. Top rate of vehicle excise duty could reach as much as £630.