Did Rachel Reeves’ ambition to become a ‘green chancellor’ survive a budget battle? Reactions were mixed.
The decision to freeze fuel duty and maintain the Conservatives’ 5p cut in 2022 is particularly important as the tax cut is estimated to have increased UK greenhouse gas emissions by 7% since 2010. , which drew some ire. Mr. Reeves is accused of having “completely done it.” By taking this decision at the same time as capping bus fares from £2 to £3 and increasing rail fares by 4.6%, we are doing the “wrong thing” for the climate.
Paul Johnson, director of the Institute for Fiscal Studies, tweeted. Despite large overall tax increases, the Chancellor also increased taxes. Fuel duty will be frozen and a “temporary” 5p cut maintained. This government should be concerned about climate change. And I believe that the fiscal numbers are assumed to increase over time. How much more? ”
Hira Khan Adeogun, co-director of climate change charity Possible, said: “Public transport prices are rising every year, while fuel taxes will be frozen for the next 15 years.” This is completely the wrong direction and we need to move to a system that provides the greenest transportation options, cheapest and most convenient. ”
To balance that out a bit, tax increases for air passengers have been announced, with increases of up to £2 for economy short-haul flights and up to £450 per passenger for private jet travel.
The Budget also confirmed that Defra is undertaking a review and could see cuts to flood resilience funding and payments to agriculture.
The Guardian reported last month that flood and nature-friendly farming schemes would be cut. Experts and farmers are calling on Environment Secretary Steve Reid and Mr Reeves to refrain from making cuts to flood defenses, which will be costly in the long term while people lose their homes and jobs. On the other hand, it would be impossible to achieve nature goals without paying farmers to restore their land to nature.
However, the published budget document states the following: “The Government faces significant funding pressures of almost £600m for flood protection and agriculture programs in 2024-2025. The Government has delivered on these commitments this year, but in 2025-26 these We need to review our plans and make sure they are affordable.”
Liberal Democrat environment spokesman Tim Farron said: “This is incredibly short-sighted, undermines Britain’s already inadequate food security and leaves farmers in desperate need of certainty and support. “It’s creating even more uncertainty.” The Conservative Party has completely let down the farmers. Labor had a chance to do the right thing on their behalf and let them down. ”
Ami McCarthy, political director at Greenpeace UK, said: “Sewage is still being pumped into our rivers and oceans, homes and livelihoods face increased risk of flooding, and our wildlife is at critical risk. In a time of suffering, further cuts would be completely unconscionable.” The UK is one of the most nature-depleted countries in the world, restoring nature is essential to reducing emissions and we need bold government action to turn this around. ”
Ed Miliband’s Department for Energy Security and Net Zero have come through with a 35% capital increase and new investment rules that allow money to be funneled into renewable energy projects.
Ed Mathews, campaign director at independent climate change think tank E3G, said: “After years of flat investment, the government is now making the UK a clean energy powerhouse and investing even more in greenhouse gas homes. “We must seize the opportunity of increasing investment rules.” It’s the economic opportunity of the century. ”
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Shares in North Sea oil companies Harbor Energy, Enquest, Ithaca Energy and Celica Energy soared after the Budget revealed a loophole in the windfall tax that would raise the overall tax rate on oil and gas profits to 78%. It rose across the board. Oil and gas developers will continue to have access to 100% first-year capital allowances within the windfall tax regime.
The Budget also confirmed a decarbonization quota to encourage industry to invest in cleaner, lower-emission technologies, with the quota set at 66% and the 29% investment quota by 2030 scrapped. Ta. Harbor, Enquest and Ithaca stock prices stabilized at around 3%. By mid-afternoon, Celica shares remained up about 10%, surpassing the previous day’s closing price. Jefferies equity analysts said the results were positive, contrary to most industry expectations.
Mr Reeves will commit more than £1bn to the Warming Homes Scheme next year, with an initial £3.4bn investment to decarbonise heat and make homes more energy efficient between 2025-26 and 2027-28. announced that it would be guaranteed. Activists pointed out that this was only half of what Labor promised in its manifesto.
Simon Francis, co-ordinator of the End of Fuel Poverty Coalition, said: “The only way to permanently lower electricity bills is through investment in insulation, home improvements, renewable energy and infrastructure, which will help us reduce our erratic gas emissions.” “Free us from prices forever.” But in his Budget, the Chancellor only approved half of the warm housing scheme promised by Labor in its manifesto. And it remains unclear whether ministers will be able to confirm the total amount of £13.2bn needed to help people improve their homes. ”
