One and a half cheers for George Osborne. As the UK economy prepares to hurl itself off a cliff, he has decided it should do so with a parachute with lots of holes in it. Which is an improvement on his Plan A, which was to do so with no parachute at all: (H/T Benny Peiser/Global Warming Policy Foundation)
As Allister Heath rightly notes, the announcement is not nearly as growth- and business-friendly as the Tory spinmeisters might like us to believe:George Osborne has vowed that the UK will not lead the rest of Europe in its efforts to cut carbon emissions, raising the prospect that the country's carbon targets could be watered down if the EU does not agree to more ambitious emission reduction goals.In a potentially explosive intervention, Osborne insisted the government will only cut emissions in line with its neighbours in order to ensure British businesses are not put at a disadvantage.Speaking at the Conservative Party conference on Monday, the Chancellor accused environmental regulations of "piling costs on the energy bills of households and companies" and argued that the government should not adopt green targets that damage the business sector.
At least, though, it shows encouraging signs that the Coalition is trying to find wriggle room to escape from among the most damaging and expensive pieces of legislation in parliamentary history – the 2010 Climate Change Act which commits Britain to spending a minimum of £18 billion a year till 2050 chasing carbon reduction targets so hopelessly optimistic they could only be achieved by closing down the UK economy.But the chancellor’s message – that carbon reduction would not take place any faster than in the rest of Europe – suffered from incorrect benchmarking. The UK’s rivals when it comes to the location of manufacturing activity are not in Europe – they are in emerging markets. It might have sounded like a pro-growth statement to the Treasury (which spends more and more time dealing with Brussels) but to UK Plc (which spends its time dealing with the world) it means nothing.