Geoffrey Lean: How long can Darling run on empty promises?

By promising the 'greenest Budget ever', and then failing dramatically to deliver, the Chancellor has merely echoed his master's voice. It's time for No 11 to find its green bottle, before environmental taxation no longer captures the public imagination

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Wednesday's heavily hyped "greenest Budget ever" was, as Yogi Berra – the baseball star famed, as Alistair Darling used to be, as a dependably safe pair of hands – once said, "like déjà vu all over again". For in promising much, and then disappointing even more, the Chancellor faithfully followed the unedifying example set by his predecessor and Prime Minister.

In his first Budget, back in July 1997, Gordon Brown committed himself to putting "the environment at the core of the Government's objectives for the tax system". He then presided over a 22 per cent fall in the proportion of revenues taken by green taxation during his time at 11 Downing Street.

Echoing his master's voice, Mr Darling pledged in December that similar "sustainability" would be "at the heart" of his debut. But the measures he actually announced on Wednesday will ensure that the share of green taxes falls yet again. And he didn't even resort to Berra's celebrated defence: "I didn't really say everything I said."

Indeed, the rhetoric, at least, continued to be green. The Chancellor mentioned "the environment" or "climate change" 15 times in his speech: only "stability" was cited more. And he rightly insisted: "The need to take action is urgent. There will be catastrophic economic and social consequences if we fail to act." But then he did virtually nothing.

Not just environmentalists were disillusioned. "This certainly was not a green Budget, at a time when both the domestic sector and industry needed a green Budget," said Gareth Stace, head of environment for EEF (the voice of manufacturing, formerly known as the Engineering Employers Federation). And the Royal Society, Britain's premier scientific body, pointedly remarked: "Those who had predicted a green Budget unfortunately got it wrong."

This seems to be part of a depressing pattern. Last November, in his first green speech as premier, Mr Brown announced that the "transformation" of electricity generation away from the fossil fuels that emit carbon dioxide must "start now". Yet last week, his Secretary of State for Business and Enterprise, John Hutton, went out of his way to back coal-fired stations – the most polluting of all – boosting speculation that the Government will shortly approve the first in 20 years, at Kingsnorth in Kent, which will emit three times as much of the gas as the entire country of Rwanda.

In the same speech, the Prime Minister promised that "every new policy will be examined for its impact on carbon emissions". But his Secretary of State for Transport, Ruth Kelly, then immediately announced the third runway at Heathrow, which alone will be responsible for the same level of emissions as Kenya.

And internal documents have revealed that, over Kingsnorth and Heathrow, both departments have colluded with the developers to evade environmental obstacles to the plans.

If this was just the result of disjointed government, the "green Budget" was a chance to put its policies back on track. Instead, the trivial irrelevance of its measures, set against the urgency Mr Darling himself proclaimed, speaks volumes.

The Chancellor introduced new bands for road tax, bringing the differential between the most polluting and cleanest vehicles to £455, but this is still far less than in countries such as Belgium. He increased the levy for new cars to impose a one-off "showroom tax" of up to £950, but this will scarcely deter those splashing out on a Porsche Cayenne. And he improved and increased the tax on flying, but any effect will be far outweighed by the Government's insistence on airport expansion.

Mr Darling had promised to increase fuel duty, but then delayed the increase for six months after meeting the road haulage industry (and refusing to see Friends of the Earth, who wanted to put the contrary case). He gave some indication that, once introduced, it would continue to increase – but only by small amounts. And changes to the tax allowances for company cars should lead to less polluting fleets, but only slowly.

In all, far from going up, the proportion of revenue coming from green taxes will fall again in the next financial year, if only marginally, by 0.01 per cent. Not much to show for "the greenest budget ever".

Worse, by hyping its "sustainability" and then failing to deliver, the Chancellor is discrediting green taxes as well as neglecting them. Even before the Budget, two-thirds of Britons believed that the Government used them simply to raise revenue, rather than to cut pollution. After it, observers from every standpoint agreed that that was ministers' only objective. The danger is that, when the pain comes, people will turn against the whole concept of environmental taxation.

Yet, green taxes have worked well enough elsewhere. The Swedish environment minister, Andreas Carlgren, told me last week that a carbon tax, introduced in the early 1990s and increased ever since, regardless of the party in power, had had a "tremendous effect", cutting emissions by an estimated 20 per cent of what they would otherwise have been. Norway has had successful green taxes since 1971. And the Dutch have worked out how to make them benefit, rather than disproportionately hurt, the poor.

As Mr Brown and Mr Darling both know, green taxes properly applied as part of an ecological tax reform – which lowers the burden of taxation on employment and income, while increasing it on pollution – generate hundreds of thousands of jobs, while combating climate change. And, despite everything, such a switch remains popular: a recent Mori poll backs it by six to one.

It is high time that the pair find their green bottle. Mr Brown's friends insist that it will soon be on display. They admit that Mr Darling, as Yogi Berra once put it, made "a wrong mistake" in hyping the verdancy of the Budget, and insist that the real changes – in a massive switch to energy from renewable sources – are yet to come.

Let's hope that, for once, the promise is fulfilled and the Government finally does take decisive action, eschewing the baseball legend's advice that is apparently beloved of ministers: "When you come to a fork in the road, take it."

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