Huge cuts to climate and environment departments hit Tories’ green claims

Green issues just aren’t as central to the [Tories’] political offer as they once were; green issues are not needed to ‘de-toxify’, because Lib Dems do this.

In opposition George Osborne made lots of green promises, for example he said “if I become chancellor, the Treasury will become a green ally, not a foe” – but today Mr Osborne announced that the budget of the Department of Energy and Climate Change (DECC) is to be cut by 18 per cent in real terms over the next four years, and the environment department’s is to be cut by 29 per cent.

This seems to reflect comments from one Number Ten adviser quoted in The Guardian this week, who said:

“There’s no doubt about it… Green issues just aren’t as central to the [Tories’] political offer as they once were… Green issues are not needed to ‘de-toxify’, because the Lib Dems do this.

Anyway, here’s a round up of the most significant green announcements today:

• The long-promised Green Investment Bank will get just £1 billion, much less than the £4-6bn Ernst and Young recommended, and hoped for by green campaigners. It will only begin to kick in from 2013. It is not yet clear if it will be a real bank, established through primary legislation, and able to issue bonds and loans, and it is not clarified whether or not it will have a clear mandate for clean energy and energy efficiency projects

Executive director of Greenpeace, John Sauven, says:

“A poorly financed fund is not a green bank. It doesn’t have the financial clout, or the independence to do the job, and will end up as nothing more than an ill-equipped quango. So if this government wants to live up to its own billing as the greenest ever, this bank must be independent and properly financed.”

• The budget for Carbon Capture and Storage (CCS) technology appears to have been massively scaled back from almost £10bn under the previous Labour administration to just “up to £1bn”. Perhaps then it’s no coincidence that E.ON announced this morning it wouldn’t be proceeding with its controversial Kingsnorth project for a new coal plant with only partial CCS, saying the economics no longer stacked up.

The Guardian’s head of environment writes:

“A full £1bn would get one CCS demo built, but the plan was for four – there’s little hope for the other three.”

If this turns out to be true it runs counter to the ‘coalition agreement’, which promises to match Labour’s four CCS demonstration projects. However, BusinessGreen reports DECC are still working on how to fund the other three. Jeff Chapman of the ‘Carbon Capture and Storage Association’ described £1bn for CCS demos as “a step backwards” and “a blow to business confidence”.

• Whilst the headline of a raised Department for International Development (DfID) budget looked good on the surface, Left Foot Forward understands this will hide cuts made in other departments including defence, environment and climate change ministries. For example, the £1.5bn promised in Copenhagen, to be spent over the next three years to help protect rainforests and support the poorest countries to cope with impacts of climate shifts, is now to will come from raiding existing budgets, including the aid budget.

• Rail fares are to soar 3 per cent above inflation for the next three years. This is likely to drive people into their cars and onto planes and so it has horrified sustainable transport campaigners. Stephen Joseph, the head of the Campaign for Better Transport, said:

“Hard-working commuters who depend on the train face paying over £1,000 more for their annual season ticket by the time of the next election.”

• One bit of good news on the green front is that “£200 million for low-carbon technologies including offshore wind technology and manufacturing infrastructure at port sites” has been saved. This was perhaps a reaction to press reports this would see off 60,000 green jobs in new wind turbine factories – as reported by Left Foot Forward last week.

• Also saved is the Renewable Heat Incentive, though The Guardian reported it would be worth 20 per cent less than Labour’s. This has been saved at the expense of the Warm Front programme, which aimed at helping the fuel poor. Equally, ‘feed in tariffs’ designed to provide an incentive to clean energy pioneers are set to fall from 2013 by about £40m.

• The existence of The Carbon Trust and the Energy Saving Trust are still “under review”.

UPDATE 17.28:

Following a call from a DfID press officer, the author would like to clarify that the £1.5bn promised in Copenhagen was, under Labour as well as the Coalition, going to be raided from DfiD’s budget.

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