Darling claims green spending can help economic recovery

The Government has promised to create up to a million "high-value green-collar jobs" jobs over 20 years as a way of tackling the economic crisis as part of its pre-budget package on the environment.

By Rowena Mason Last Updated: 10:06PM GMT 24 Nov 2008

Chancellor Alistair Darling addressed ways of hitting emissions targets, reducing household bills and supporting renewable energy in a lengthy section of the report entitled Delivering on Environmental Goals.
Among the new measures, the Chancellor promised to reduce carbon emissions to 80pc by 2050, extend carbon trading schemes to the aviation industry and commit to renewable energy targets until 2037.
He also said £535m of capital spending on insulating 60,000 homes, improving flood defences and buying new 100 trains would be brought forward.
Mr Darling stressed that tackling the economic crisis in the banking sector was not incompatible with spending on the environment.
"The economic recovery must support our environmental objectives – not come at its expense," he said.
The focus on green issues surprised some analysts who had expected environmental concerns to take a back seat in the facing of growing concerns about the financial services sector and impending recession.
"It might not be enough for the environmental lobby, but the £535m capital spending is quite sizeable and represents a quarter of all income from green-related taxes," said Helen Devenny, indirect tax director at Deloitte. "There's not a huge amount of detail on aspects such as the extra jobs, but it is a huge cornerstone of the report and if they hadn't made some progress on environmental issues, they would have been criticised."
Michael Soltock, corporate tax partner at Blick Rothenberg, the Government's approach to green taxes and spending had become more diverse and sophisticated.
"It's hard to argue with the morals of the Government's commitment to spending on renewables, emissions trading and aviation duty, but it could be seen that it is surprising given all the other pressing issues," he said.
The Society of Energy Producers welcomed the Government's commitment to supporting power companies during the transition to renewable energy.