Spring budget 2024: green economy is overlooked in ‘botched’ budget

Chancellor Jeremy Hunt has announced his budget and financial update for spring 2024, with a £5bn boost for motorists taking priority over the £120m earmarked for developing green technologies.

Under increasing pressure to win over voters with tax giveaways and favourable policies, Hunt’s budget revealed he would continue to freeze fuel duty for a further 12 months, a move which is expected to cost the Treasury around £5bn.

Announcing the measure in parliament earlier today, he said: “The Labour mayor of London wants to punish motorists even more with his Ulez plans but lots of families and sole traders depend on their car. If I did nothing fuel duty would increase by 13% each month.”

The decision is the latest in a series of government blows to the UK’s climate goals, with Carbon Brief analysis suggesting that 14 consecutive years of fuel duty cuts and freezes have resulted in 24% more carbon emissions from UK road traffic.

Elsewhere, a call for “unnecessary and unfair” VAT rates to be cut as part of a move to level the playing field for EV vehicle drivers went ignored in today’s budget, despite costing far less than the fuel duty freezes. Current VAT rates mean that the price difference between charging at home or in public is now acting as a barrier to EV adoption.

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Moving onto clean energy, Hunt also confirmed the government will spend £160m on two nuclear sites, before going on to allocate just £120m for green industry to develop technologies including offshore windfarms and carbon capture and storage projects.

Greenpeace head of climate justice Aakash Naik said the budget was the chancellor’s “last chance to tackle the scale of the climate and economic crises the country faces, but he’s completely botched it”.

“Refusing to invest properly in the green economy of the future is a huge mistake. These short-termist giveaways will do almost nothing to address our grossly unfair tax system, ease the cost of living, boost our stagnant economy, or tackle the climate crisis.

“Right now, we live in a topsy turvy world where billionaires pay tax at lower rates than ordinary working people, and fossil fuel companies receive around £3bn in government production subsidies every single year, whilst they destroy our planet.

“This budget will do nothing to address this injustice.

“We urgently need a fairer tax system, one that closes loopholes, taxes wealth at the same rate as income, and ensures the super-rich and big polluters pay their fair share. This, plus borrowing to invest in a safe future with a bold green industrial strategy for public transport, renewables and home insulation would boost jobs, help the cost of living and grow our flailing economy.”

WWF director of policy solutions, Angela Francis, also described the budget as a “missed opportunity” to tackle the climate crisis.

“We know that importing polluting oil and gas is pushing up household bills and damaging the planet. Despite extending the windfall tax, government has done nothing to close the loopholes in it that give oil and gas giants huge tax write-offs…

“Choosing to prioritise the profits of fossil fuel companies, could cost us over £10bn a year and break the promise to phase out oil and gas subsidies the government made at Cop28.

If the government is serious about creating more opportunity and more prosperity for the UK then it must invest in clean, cheap British energy which will reduce bills, grow our economy and protect the planet.”

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