THE PRE-BUDGET REPORT 1999: PESTICIDES, AGGREGATES
AND THE CLIMATE CHANGE LEVY
INTRODUCTION
2. This report sets out the Committee's views on
the progress made by Government in shifting the burden of taxes
from environmental "goods" onto environmental "bads"
in line with the Statement of Intent on environmental taxation
issued by the Government in 1997. It continues the Committee's
annual audit of progress in this area by reporting each year on
both the Pre-Budget Report and the Budget.[8]
3. The Government's Pre-Budget Report (PBR) provides
a key opportunity for the Government to set out developments in
its strategy for placing environmental concerns at the heart of
government. The Committee commented that the 1999 Budget was the
greenest ever.[9] It is
vitally important that the Government should maintain the momentum
in view of the challenges inherent in achieving sustainable development
as set out in the revised sustainable development strategy[10]—particularly
the need to reduce UK greenhouse gas emissions.
4. This year we examined in detail three areas where
the Government has been considering, or planning to introduce,
environmental taxes: energy consumption, pesticides use and aggregates
extraction—including the consistency of approach. We also
looked at other issues arising out of the 1999 Pre-Budget Report
including: environmental evaluation, Government procurement, VAT
on energy saving measures, and the fuel duty escalator.
5. The report includes at Appendix 1 the Government's
reply to the Committee's report on the 1999 Budget statement and
incorporates our comments on that.
6. The Committee took evidence from:
the Royal Society for the Protection of Birds (RSPB),
the Pesticides Trust, the National Farmers Union (NFU), the British
Agrochemicals Association (BAA), Water UK, and the Environment
Agency—on pesticides use;
the Quarry Products Association (QPA), English Nature,
the Council for the Protection of Rural England (CPRE), and the
Wildlife and Countryside Link—on aggregates extraction;
the Energy Intensive Users Group (EIUG), the Confederation
of British Industry (CBI), and the Emissions Trading Group (ETG)—on
the Climate Change Levy; and
Mr Stephen Timms, Financial Secretary and Green Minister
for the Treasury on all issues.[11]
7. The Committee is grateful for memoranda from a
wide range of organisations, including environmental organisations,
industry trade associations, and government bodies. Some of the
areas the Committee examined have been subject to extensive government
consultation recently, and a number of organisations provided
the Committee with copies or extracts from consultation documents
they had submitted to government.[12]
In addition, we received memoranda from the Treasury on the environmental
impact of the Climate Change Levy, VAT on energy saving measures,
procurement issues, and on various points arising from the oral
evidence Mr Timms gave to the Committee.[13]
8. The Committee also acknowledges assistance from
its two specialist advisors on environmental economics, Dr Paul
Ekins of Forum for the Future and Keele University and Mr Chris
Hewett of the Institute for Public Policy Research.
8 The Committee's earlier reports were its First Report,
The Pre-Budget Report, HC547, Session 1997-98; its Third
Report, The Pre-Budget Report: Government Response and Follow-up,
HC985, Session 1997-98; its Fourth Report, The Pre-Budget Report
1998, HC93, Session 1998-99; and its Eighth Report The
Budget 1999: Environmental Implications, HC326, Session 1998-99 Back
9
Eighth Report, HC326, Session 1998-99, paragraph 9 Back
10
A Better Quality of Life, A strategy for sustainable development
for the UK, Cm 4345, May 1999 Back
11
Ev pp 10, 36, 46, 56, 72, 90, 105, 120, 126, 135 Back
12
The witnesses and memoranda received are listed at the back of
this report and all the evidence is to be published as HC76-II Back
13
Ev pp 130-135, 153 Back
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