Tories edging away from green tax plans

The Conservative Party is reportedly poised to water down its green tax plans, amid fears that the policy could prove unpopular during a recession.

According to a story in today's Guardian newspaper, shadow chancellor George Osborne is to take action as part of a wholesale review of Tory economic policy. This has been prompted by party perception that it is being outmanoeuvred by the government's response to the downturn.

Citing anonymous senior figures within the party, The Guardian claims Osborne has decided to downgrade green taxes after the government was criticised for increasing taxes on the most polluting vehicles. He believes that taxing environmentally damaging behaviour will prove too difficult to sell to the electorate during a recession.

The move would represent a risky strategy for the party, which has made its new-found commitment to environmental issues central to its successful rebranding.

Only last month Conservative leader David Cameron won plaudits from green groups for his decision to oppose a third runway in Heathrow and instead invest in the building of a new high-speed rail network.

However, the "vote blue, go green" message is likely to be tainted if the Conservatives do ditch green tax plans, particularly at a time when business and environmental leaders the world over are insisting that tackling climate change must remain near the top of the economic agenda.

Only this week, Nobuo Tanaka, executive director at the International Energy Agency (IEA), urged political leaders to stick with green policies, arguing that "we cannot let the financial and economic crisis delay the policy action that is urgently needed to ensure secure energy supplies and to curtail rising emissions of greenhouse gases".

The TUC also chose this week to reiterate its calls for a "green industrial revolution" modelled on the huge increase in cleantech spending promised by US president-elect Barack Obama.

General secretary Brendan Barber said that "while short-term measures are needed to minimise the impact of the economic downturn, the government also needs a long-term strategy to ensure that the UK emerges with a more equal and sustainable economy".

He added that the development of "a green industrial revolution to make our economy more sustainable and competitive in the long term" should be central to this long-term strategy.