Lessons from the "carbon stealth tax"

The Spending Review’s biggest surprise on climate change policy was to turn the CRC Energy Efficiency Commitment - an auctioned emissions trading scheme for large-scale commerce and the public sector - into a carbon tax. The money from the worst emitters under the scheme won’t be recycled back to low carbon emitters after all. Instead, the money raised, expected to reach around £1 billion a year by 2014-15, will go straight into the Treasury’s coffers.

The Coalition Agreement promises to “increase the proportion of tax revenue accounted for by environmental taxes”. The same pledge appeared in the Conservatives’ election manifesto. Liberal Democrats have backed a green tax switch for years. In September, the party conference called on the government to set a target for not less than 10% of its revenue from such measures by 2015, compared to about 8% now.

Numerous studies, including the work of the Green Fiscal Commission, have shown that green taxes are one of the most effective and efficient ways to cut carbon emissions and hasten the shift to a low-carbon economy. And taxes on carbon enable the government to set the price of carbon emissions – the carbon price – and leave it up to the market to decide how much to reduce emissions.

Yet ministers are not talking up the changes to the CRC as a major environmental achievement. “Green” NGOs are not exactly applauding either. One reason may be that the changes to CRC Energy Efficiency Scheme weren’t mentioned in the chancellor’s big speech on 20 October. You had to turn to page 62 of the full Spending Review report to find them, along with a vague statement that some money will be spent on environmental programmes. The phrase “carbon tax” was not even used by the government. As a result, the changes to the CRC look like a “stealth tax”, a point that the CBI and the British Retail Consortium have been quick to seize on.

The more important point is, surely, that nearly one fifth of the UK’s CO2 emissions come from the energy used in non-domestic buildings. With CRC reformed as a carbon tax, business and public sector organisations will now receive a clear message that they have to take the energy efficiency of their buildings seriously. A carbon tax should stimulate the innovation needed to cut emissions from the built environment more quickly than ‘recycling revenue’ from the CRC energy efficiency scheme. And the new scheme will be simpler to administer; the costs of complying with the original version were becoming a major bugbear for businesses.

Still, the “polluter pays” argument doesn’t completely settle this one. First, the new carbon tax may not be fair (that word again). Carbon Clear’s James Ramsey has pointed out that bigger emitters, who are covered by the EU Emissions Trading Scheme, are not taxed and can receive free emission allowances, often in excess of what they require. We also need to avoid distortions between domestic measures and the EU ETS. So, future environmental tax measures should be looked at as a coherent whole, rather than as a quick way of raising revenue. One option is to run a comprehensive UK carbon tax alongside the EU ETS, with other taxes reduced.

There will soon be opportunities to consider these questions in detail. The energy and climate change secretary, Chris Huhne, has promised wider increases in green taxes. He has also said they will be offset by cuts in other parts of the tax system.

Second, we need more trust and accountability around environmental taxes. The Green Fiscal Commission and others have found that the public are already highly suspicious of “green taxes”, perceiving them to be revenue-raising measures in disguise. The argument over the CRC Energy Efficiency scheme shows that imposing environmental taxation by stealth only fuels business and public distrust. The government should be open with people about any new environmental taxes and what they mean and, where possible, give those affected time to prepare.

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New poll shows reformers how to win - and lose - the AV referendum

YouGov recently put up the results from a large poll on the AV referendum for the Constitution Society, conducted on 31 August – 1 September. As described by UK Polling Report, this contained a similar exercise to the YouGov poll in the summer that asked people how they would vote in an AV referendum. The result this time was 32% for AV, 33% for first past the post (FPTP), 26% don’t know and 9% wouldn’t vote.

The survey then exposed to people to various pro- and anti- arguments on AV, along with questions about what they wanted from an electoral system, which parties would benefit and so on to encourage them to think around the issues. At the end of the survey they were asked again, and once again opinion had shifted further against AV. The end result was 31% for AV, 38% for FPTP, 25% don’t know and 6% wouldn’t vote.

One of the striking features of the results is the dominance of the “simplicity” and “quick result” frames. Respondents gave the notion that “an electoral system should be simple and straightforward so everyone can understand it” a net “important” score of +80%. In a similar vein, the idea that “an electoral system should produce results that the voter can see are logical and not open to question” had a net “important” score of +78%. And the idea that that “an electoral system should give people the chance to kick an unpopular government out of office” had a net +67% “important” rating.

The “strong government” frame was also important to voters. The idea that “an electoral system should tend to give the most popular party an overall majority of MPs so they can form a strong government” had a net +59% “important” score.

The “proportionality” or fairness frame was less dominant. In net terms, +46% saw the concept that “the number of MPs each party wins should be in proportion to the total vote they get in the country” as important.

The “constituency link” – having single member constituencies for an area – as important was seen as important by +61% in net terms. But only a net +13% (and a minority of respondents) were concerned about having multi-member constituencies, so that most voters could turn for help to an MP from the party they support.

The above frames were all more pronounced amongst voters who answered “don’t know” the first time they were asked to choose between AV and the current voting system.

All this may explain why voters, including the “don’t knows”, tended to turn against AV when some arguments were put to them.

The most effective arguments for AV were:

· The Alternative Vote would allow people to cast their first preference for the party they really supported without wasting their vote. For all voters the net “convincing” score was +30%;for don’t knows +32%.

· Unlike most fully proportional systems, AV would retain constituencies so people would still have a local MP. For all voters the net “convincing” score was +28%; for don’t knows +23%.

The following arguments for AV were only moderately effective:

· The Alternative Vote would make it more likely that every MP had the support of 50% of people expressing a valid preference. For all voters the net “convincing” score was +15%;for don’t knows +7%.

· The Alternative Vote would make it more likely that every MP had the support of 50% of people expressing a valid preference. For all voters the net “convincing” score was +11%; for don’t knows 0%.

The least effective pro-AV arguments were:

· AV would increase the chances of a hung Parliament and therefore make parties more likely to work together for the good of the country. For all voters the “net convincing” score was +3%; for don’t knows it was +5%.

· FPTP is unfair and unproportional. Adopting AV, although not proportional, would be a step towards a fully proportional electoral system. For all voters the net “convincing” score was +2%; for don’t knows it was +7%.

· Under AV, someone's third or fourth preference could count just as much as someone else's first preference. For all the voters the net “convincing” score was +1%; for all voters it was +3%.

The most effective argument for FPP was:

· First Past the post is straightforward - the candidate who gets the most votes becomes the Member of Parliament. For all voters the net “convincing” score was +44%; for all voters it was +49%.

But there’s a health warning. Public understanding of AV is still very low. Just 33% of respondents said that they had heard of AV and had a broad idea of how it works. Almost the same number, 32%, had never heard of AV. The remaining 35% but were not sure how it works.

Between 25% and 30% of respondents did not know what they thought about most of the arguments for and against AV and FPP. Amongst undecided’s, those figures ranged from 45% to 59%.

So there’s a lot to play for. For now, however, the priority is to make sure that the government, or the Electoral Commission, should invest in educating the public about both first-past-the-post and AV.

Anyone know what’s planned in that regard?

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On 10:10 and "No Pressure"

The 10:10 campaign, set up to persuade people and organisations to commit to cutting their carbon emissions by 10% by the end of 2010, has shot itself in both feet.

No Pressure, their latest mini-film, tried to push climate change back into the headlines in a way that made people laugh. Produced by Richard Curtis (Blackadder, Four Weddings and a Funeral), the mini-film contains four scenarios in which people who do not make pledges to reduce emissions are blown up by committed carbon campaigners, scattering their blood and bits across the faces and clothing of classmates, workmates and friends.

Bill McKibben, the American environmental campaigner writer and founder of 350.org, has called the film disgusting, distasteful and depressing. I think that Curtis was trying to be ironic and amusing, but the film failed miserably on both counts. The end result was ghastly and boring.

10:10 have pulled the film and said sorry. But they’ve seriously damaged their credibility and handed their (/our) opponents some powerful ammunition. Sure enough, The Daily Telegraph’s James Delingpole has denounced this latest example of “eco-fascism” and slammed what he perceives as the dark heart and intolerance of “the environmental movement”.

I appreciate that this opportunity was too good for a provocative columnist like James Delingpole to pass up. But let’s stop and ask: just what is “the environmental movement” in 2010? “The environmental movement” encompasses NGOs like Greenpeace Friends of the Earth and WWF-UK and campaigns like 350.org . . . and 10:10. It also covers think tanks like Forum for the Future, Green Alliance and E3G and commentators and campaigners like George Monbiot, Mark Lynas and Jonathon Porritt.

But then the “environmental movement” might be business organisations like the Climate Group, the UK Business Council for Sustainable Energy, or the Prince of Wales’s Business and Sustainability Programme. Or the OECD Environment Directorate. Or merchant banks like Climate Change Capital.

This list, by no means exhaustive, captures a wide variety of drivers, agendas, ideologies, policies, strategies and tactics, from “deep greens” to “environmental citizneship”, “environmental justice”, “eco-feminism”, and “ecological modernisation” and much else. An inept film from one campaign proves nothing about all the strands and streams of modern “environmentalism”. It tells us rather a lot, however, about the judgment of those running 10:10.

So, should 10:10 pack up and go home? I think not. Individuals should be encouraged to “make a difference”. In his 2009 book A Blueprint for a Safer Planet, Nicholas Stern discusses “the power of the example” and shows that the annual emissions of greenhouse gases for a typical European lifestyle are, per person, around 10-12 tonnes, the most significant contributors to which come from heating homes, using electrical appliances and travel by car and air. He says that in the UK, the average household can save around 1.5 tonnes of greenhouse gases annually by making their home more energy efficient.

Campaigns like 10:10 can engage people in tackling what is surely the greatest challenge that humankind has ever faced. Over time, they can also help to build a public consensus behind some of the difficult and potentially costly (in the short term) measures that are going to be needed (such as consumer levies for renewable energies or even higher power prices to pay for new investment). Campaigns like 10:10 can put pressure on their governments to take the decisive action that is needed to reduce greenhouse gas emissions.

But where personal targets are used, they should be clear and long term in nature, with incentives and enablers available (which is what the Green Deal is supposed to be about). And if people set themselves targets, they need to be able to verify the savings. For me, this has been where 10:10 has always come up short.

More urgently, 10:10 needs to re-think its communications strategies. In recent years, some of us have tried to work out more effective ways to inspire public support for shifting to a low carbon economy. New perspectives – and not a small number of debates - have been opened up, on having a positive and compelling vision, communicated with emotionally resonant stories and frames, by credible messengers. [Click here, here, here and here].

The real tragedy of “No Pressure” is that, for all its attempts at irony, the film preached to us, with a negative message and a ‘doomsday’ frame, all sure-fire ways to push people away. This debacle could so easily have been avoided.

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