Fair on fuel: Fair on the future

 

A social, economic and environmental case for higher fuel taxes

 

The Green Party of England & Wales

June 2004

 

Written for The Green Party by Dr Spencer Fitz-Gibbon, with thanks to the following for their assistance: Alan Francis (Green Party Transport Spokesperson), Dr Ben Matthews (Green Party Climate Policy Advisor), Ffinlo Costain, Prof John Whitelegg (Eco-Logica environmental consultancy), Dr Lucy Ford, Martin Hughes-Jones, Dr Richard Lawson, Sarah Green, Dr Tony Grayling (Institute for Public Policy Research); and also the Department of Applied Economics at the University of Cambridge, the Environment Agency, the Environmental Transport Association, Friends of the Earth International, Friends of the Earth UK, the Global Commons Institute, The Guardian, HM Customs & Excise, the House of Commons Library, the National Farmers Union, the Road Danger Reduction Forum, and Transport 2000.

 

 

 

Foreword

 

New foreword by Professor John Whitelegg

Green Party spokesperson on sustainable development

 

Since this report was first published in 2000, society has made little progress in dealing with a range of related problems including:

 

·        The oil dependency of our economy, which makes us vulnerable to periodic shocks and disruption. We are still far too dependent on oil.

·        The urgent need to reduce CO2 emissions, not least from road transport, to tackle the climate change which is increasingly recognised as the biggest single threat to our economy. Traffic is still increasing.

·        The huge problem of “external” or hidden costs of road transport, including its share of the bill for climate change, the health costs of increasing noise and air pollution, and the ever-increasing costs of road maintenance.

 

Road fuel prices don't reflect the huge hidden costs of road transport – its contribution to climate change, pollution-related ill-health and so on - which now amount to perhaps £15 billion a year and maybe a lot more. Fuel should cost more so that road transport pays its true costs.

Of course fuel tax must be progressively increased, but under two conditions: firstly there must be overall tax reform that redistributes wealth downwards so that eco-taxes don't impact unfairly on poorer people; and secondly we must invest hugely in alternatives to the car so that people have proper choices in mode of transport.

 

In short, we need to tackle climate change, drastically reduce the hidden costs and the social and human costs of road transport, while tackling poverty and developing a fairer economy. These are interrelated problems, and the Green Party has the answers through a comprehensive package of joined-up policies. The solutions include:

 

·        HGV traffic reduction. The Green Party recently published a briefing based on European best practice, that shows how HGV traffic can be significantly reduced by better organisation in partnership between hauliers, local government and other stakeholders.

·        Reduction in average freight miles through policies of local sourcing. The Green Party has developed a plan intended to support local economies, which would have the spin-off benefit of helping reduce freight miles.

·        General traffic reduction. The Green Party recently published a plan showing how local authorities can help reduce road traffic by 20% within 10 years. A national Safe Routes to School programme alone would cut morning rush-hour traffic by 10%.

·        Scrapping the tax disc and increasing fuel duty could actually leave a typical driver of a small car financially better off, while still encouraging people to choose smaller cars and use them less where possible.

·        Scrapping the £30 billion roadbuilding programme and investing in alternatives will make public transport, cycling and walking more attractive options, which will further cut fuel use.

·        Promotion of biodiesel from such sources as recycled cooking oil. This is what fuels the Green Party’s 2004 election campaign buses and a growing number of commercial vehicles. As such fuels are carbon-neutral, they would escape Green pollution taxes.

·        Targets for manufacturers to produce more fuel-efficient vehicles, backed by financial incentives to do so.

 

We also need to deal with the short-term problems faced by hauliers. Keeping fuel prices low is simply not the answer – it’s incompatible with the need for action on climate change, but also it’s detrimental to British businesses as they are continually squeezed by imports that wouldn’t be economically viable if fuel wasn’t so cheap.

 

Measures to help hauliers should include:

 

·        Renew and redouble efforts to support small hauliers with a package of measures to help them reduce their costs. This ranges from advice on energy efficient technology to advice on the best driving practice that can cut a lorry’s fuel use by 20%.

·        Government must facilitate and support regional cooperation amongst hauliers. Information-sharing and cooperative practice amongst consortia of hauliers can significantly reduce “empty vehicle miles.” When a vehicle is empty the vehicle is still burning fuel (and causing pollution) and the haulier is losing money.

·        Government must facilitate and support small hauliers’ access to rail, coastal and inland waterway freight. Small hauliers don’t have good access to this, because it’s expensive. But a consortium representing hauliers in cooperation can buy into such services in bulk at a much more attractive price.

·        Where necessary, fiscal measures should be considered, including targeted tax breaks and income support for small businesses.

 

We must not be deflected from the effort of tackling climate change and reducing the thousands of annual deaths and hospitalisations attributable to traffic pollution. But we don’t need to. We can make progress on pollution while improving business practice and cutting hauliers’ costs.

 

That’s Real Progress!

 

 

 

Contents

 

Introduction: Some basic steps towards a fairer, more sustainable society

 

1. Motorists are subsidised, not disadvantaged

·        The real costs of road transport

 

2. Government taxation policy is failing

·        Failing to reduce traffic

·        Failing to cure Britain's vulnerability to oil crises

·        Failing to tackle climate change

·        Failing to support poorer people

 

3. Greener taxation, benefits for everyone

·        The immediate term: Benefits to the environment, to local economies AND to poorer motorists

·        The medium term: Better transport choices for everyone, better health, higher quality of life

·        The longer term: A socially just and ecologically sustainable society

 

Conclusion: Genuinely Greener, genuinely richer

 

Notes


Introduction

 
Some basic steps towards a fairer, more sustainable society

I.1 This report makes a case for restoring the fuel duty escalator, while cutting vehicle tax and investing heavily in sustainable transport alternatives, as a preliminary step towards developing a Green tax structure - taxes that are fair on the less wealthy, fair on people's health, and fair on future generations.

 

I.2 This report shows that:

·        Road use is currently heavily subsidised, when " external" or hidden costs are taken into account. Road transport is a net economic burden on the UK of £11bn-£17bn a year, at a conservative estimate.

·        Fuel taxes could be immediately increased without impacting on poorer people. With increases in road fuel duty offset by cuts in car tax, a typical motorist could be £30 a year better off, while encouraged to drive less and use a smaller car.

·         Massive investments in traffic reduction could easily be made now - to provide sustainable alternatives, to cut the massive hidden costs of road transport, to increase people's transport choices, while helping tackle climate change. This investment could involve switching even as little as one-quarter of the government's intended expenditure on roads over the next 10 years. (They're planning 100 new bypasses and 360 miles of major road widening.) Even a minimalist Greening of government policy would allow £16bn to be switched to sustainable alternatives over 10 years, including £1bn for rural public transport, £1bn for improving disabled people's mobility, and £4bn for cutting rail fares.

 

 

 

1. Motorists are subsidised, not disadvantaged

 

The real costs of road transport

1.1 Official statistics show that between 1987 and 2000, although petrol and oil prices had increased by 45%, and tax and insurance payments by over 40%, the total costs of motoring in real terms had risen by only 5.6-7.2%. [1] The same figures also reveal that bus and coach fares increased by 18%, and rail fares by 21%, in real terms. Therefore, motoring costs have increased hardly at all despite the fuel duty escalator - while public transport users have faced increases 2-4 times those faced by motorists.

 

1.2 Taking a longer timescale, motorists have been even better off, and public transport users even worse. George Monbiot wrote in The Guardian recently: "While average disposable income over the past 25 years has massively increased, the cost of driving in real terms has remained unchanged. Bus fares, by contrast, have risen by 87 per cent and train fares by 53 per cent. Our train journeys are now the most expensive on earth, costing some three times more per mile than the Spanish or Italians pay. British drivers are charged more for their fuel than motorists elsewhere, but they don't pay road tolls. The truth is that Britain's vehicles are massively subsidised by those of us who don't own one." [2] [3]

 

The hidden costs

1.3 Not only has the "real" cost of motoring not increased significantly in statistical terms; but these statistics don't even reflect what economists call the "external" costs of road use - chiefly the costs of road damage, accident and emergency services, health effects of air and noise pollution, and the economic impacts of climate change.

1.4 The annual costs attributable to road transport include:

Roadbuilding £6bn [4]

Noise £2.6bn [5]

Congestion costs £19.1bn [6]

Road damage £1.5bn [7]

Accidents £2.9bn [8]

Health impacts £11.1bn [9] [10] [11]

TOTAL £43.2bn [12] [13]

 

1.5 These are conservative estimates; if the upper estimates are taken, the total is £50.2bn. The roads bring in £32bn revenue a year. [14] Therefore the roads are being subsidised to the tune of £11.2bn-£17.2bn a year. Note that some of the above figures were 1993 calculations, and will require upward revision for inflation. Moreover, these figures don't include any allowance either for land-use subsidies to motorists [15], or for transport's contribution to climate change. The latter could cost the UK billions in the coming decade.

 

The cost of climate change

1.6 About 25% of CO2 emissions come from road transport. [16] But road transport's overall contribution to the greenhouse effect is actually higher than this once we include the emissions from all the industrial infrastructure which supports the road industry. For example, we need to consider emissions from the roadbuilding process, which in turn includes the quarrying and mining of raw materials, and the manufacture of the plant involved in the roadbuilding and quarrying and mining. We need to consider emissions from vehicle manufacture, including from the mining and transportation of the raw materials. We need to consider the pollution from that portion of the oil industry which serves all the aforementioned, and so on. So including indirect pollution, the roads system may account for as much as 50% of CO2 emissions.

 

1.7 The economic burden of climate change is extremely difficult to calculate accurately. Estimates vary from 0.5% of global GDP to 200% of global GDP, depending on the assumptions underlying the calculations. [17] What can be said with certainty is that climate change is already having colossal economic impacts worldwide.

 

1.8 In England and Wales, climate change has led to an increase of 10% in annual rainfall, and a greater frequency of extreme weather resulting in flooding. Some 2m homes and businesses are in flood-prone areas. If each of these suffered just one flood, the overall cost would exceed £12bn, according to insurance industry figures. The weather events of late October 2000, which killed five people, also caused damage in the UK estimated at £1bn. The storms of early November were even worse. The total value of property, land and other assets in flood-prone areas, and this threatened, have been estimated at £214 billion. [18]

 

1.9 Enormous as the recent damage in the UK seems, it's only a tiny part of the global picture. Aid agencies, predicting a decade of "super-disasters," have estimated that 96% of the victims of environmental catastrophe live in developing countries. [19] By 2020, 75% of the world's population will be at risk from droughts and floods; and in the next 20 years, the world could see as many as 245 climate-related disasters.[20] The global cost of environmental disasters has doubled every decade since the 1960s, and reached £250bn in the 1990s. [21]

 

1.10 The indirect dangers posed by climate change in the UK and elsewhere include the threat to nuclear power stations. Scientists have predicted that some of Britain's key nuclear installations are at risk, including Hinckley Point, Dungeness, Sizewell and Sellafield. [22] Flood damage to a nuclear installation could, on its own, have immense economic costs.

1.11 It is neither acceptable that the world should face such threats, nor fair that some some people should subsidise the damage caused by others, nor reasonable that the government should fail to facilitate the social change which is necessary to guarantee sustainability. One of the keys to both sustainability and fairness is Green taxation.

 

 

 

2. Government taxation policy is failing

 

Failing to reduce traffic

2.1 Before the 1997 general election, New Labour repeatedly promised traffic reduction. But in its first Transport White Paper it performed a U-turn. It accepted that traffic would increase significantly. But in typical New Labour style, government spindoctors have tried to make more traffic sound like less traffic by talking about reducing traffic growth as though this was the same as reducing traffic volume. And the government's new 10-year plan to 2010 acknowledges that even after another £180bn is spent on transport, there will still have been a 17% increase in traffic. [23]

 

2.2 The government has claimed that the fuel duty escalator was part of its "environmental commitment." However, Tony Blair recently said that higher fuel taxes are necessary to help pay for hospitals. This would be the opposite of Green taxation, because it would mean making society financially dependent on traffic pollution for the costs of healthcare - in fact, a particular irony in that traffic pollution costs society over £11bn a year in health costs.

 

2.3 But in fact, the fuel duty escalator has not had the traffic-reduction effects which might have been hoped for - not least because the government isn't investing adequately in the alternatives to car use. Studies indicate that a 10% increase in fuel duty only results in a 5% reduction in car use. [24] The annual number of UK car-miles rose each year despite the introduction of the escalator, and even despite the much higher increases attributable to oil prices. In 1990 British motorists drove a total of 253bn miles between them. Over a decade, this rose by 12% to 284bn. [25]

 

2.4 While some of this increase may be attributable to the social irresponsibility of some individuals, a more significant factor is government policy. Firstly, if the government prioritises roadbuilding over support for public transport, cycling and walking (as it does), the alternatives to driving are likely to be inadequate (as they are), and millions of people will feel they have no choice but to drive. Secondly, if the government fails to educate people about the social, economic and environmental consequences of excessive pollution, millions of people will be insufficiently well-informed to see the need to seek Greener forms of transport. Thirdly, if government policy in general facilitates a growth in road freight, in air transport and in car use, then it can hardly escape the responsibility for increases in car-use and other fuel-intensive means of transportation - and for the dire consequences of these. That is why government policy must be genuinely Green, not just rhetorically so.

 

Failing to cure Britain's vulnerability to oil crises

2.5 The fuel tax rebellion of autumn 2000 marked the third oil crisis in as many decades. Clearly we are far too dependent on this finite resource - and certainly a lot less dependent than we need be, even in the short term. In fact it was ironic that the rise in fuel prices which led to the rebellion was not mainly due to fuel duty, but to increases in the price of crude oil imposed by OPEC countries, which have raised the crude price three-fold.  [26]

2.6 As Paul Lannoye MEP, Co-President of the Greens/EFA group in the European Parliament, said recently: "The petrol crisis that is currently stirring political unrest through Europe is the result of 20 years of serious negligence on behalf of the EU Member States. Nothing has been learnt from the petrol shocks of 1973 and 1979. The EU has paid lip service to a sustainable transport policy and to the shifting of merchandise transport from road to rail. But statistics tell another story. Road use for merchandise purposes has gone up from 50% of the total movements of goods in 1980 to over 85% in 1999. Europe is just as dependent now as then on OPEC oil but to add to its problems it is now also a hostage of the mighty haulage lobby." [27]

 

2.7 Another factor is our dependency on the profit-driven oil corporations which form a very powerful lobby group, exercising considerable influence on government policy. In the past 10 years, North Sea oil industry operating profits have almost doubled from £7.5bn in 1988 to £13bn in 1999 - although in the same period, government revenues from North Sea oil actually fell from £3bn to £2.5bn. The last Conservative government cut PRT (Petroleum Revenue Tax) from 75% to 50% on existing fields, and abolished it altogether for fields developed after the 1993 budget. New Labour has continued the Conservative policy. So although oil reserves are legally the property of the crown, the UK government allows oil companies to have North Sea oil free - and without even taxing it (other than the standard corporation tax). [28] Meanwhile Britain remains vulnerable to oil crises - whatever their cause - and the policies not only of the Labour government, but of the Conservatives and Liberal Democrats, perpetuate this vulnerability by failing to develop adequate alternatives.

 

Failing to tackle climate change

2.8 The New Labour government is failing to do what is necessary to help stop climate change. The Intergovernmental Panel on Climate Change, and the Royal Commission on Environmental Pollution (RCEP), have called for a 60% reduction in global CO2 emissions by 2050, in order to avert the worst consequences of climate change. Greens have pointed out that for this to be done in an equitable manner, those countries which have traditionally caused by far the most pollution per capita, and which continue to do so, must make cuts of 80-90% or more, in order to allow for reasonable standards of development in the poorer countries.

 

2.9 New Labour has boasted of its part in achieving an international agreement to cut CO2 emissions. But the Kyoto agreement was only for a 5.2% cut by 2012  [29] which is utterly inadequate. The government has adopted its own policy of 20% reductions by 2010 - a target based on political expediency (being better than the Conservative Party's targets) rather than on what is needed to do the job.

 

2.10 Even then, the government lacks the policies to meet those targets. The RCEP has welcomed the government's "step in the right direction," but expressed "doubts whether the measures at present proposed will achieve it." [30] The RCEP was also "disappointed at slow progress in implementing the measures required to curb traffic growth and regret[ted] that successive governments have not devoted more of the revenues from the fuel duty escalator to developing alternatives to car use." [31] The Commission found it necessary to make some 87 policy recommendations, indicating the extent of the shortcomings in the government's policy.

 

2.11 The government is even more behind in its policy on air transport. Aviation is the fastest-growing source of greenhouse gas emissions, and the government's policy is to facilitate the growth of the industry. The larger airlines get their fuel for about 17p a litre, and pay no tax on it whatsoever. Air tickets are 42% cheaper than they were 10 years ago, and air traffic is expected to almost double during the next 15 years if preventive action isn't taken. [32] Although, thanks to work by the Greens in the European Parliament (led by South East England's Green MEP Caroline Lucas), the EU has now accepted that aviation fuel must be taxed, the UK government has failed to take the necessary vigorous lead in the international arena. And this from the party which promised to "put the environment at the heart of government."

 

2.12 The devastating floods of autumn 2000 - causing damage in the UK estimated at £2.4bn [33] - should have been a timely reminder of the consequences of inaction. The effects on poorer countries are going to be far worse. The UK government must begin serious reform towards the eco-taxation essential to a sustainable economy, and must act vigorously in the promotion of serious climate targets at the international level.

 

Failing to support less wealthy people

2.13 It is simply not true that Greener taxation and transport policies necessarily impact on poorer people. The poorest people don't even have cars, but tend to suffer the adverse effects more sharply than wealthy people. As George Monbiot wrote recently, "While 59 per cent of households in social class five have no access to a car, their children are five times as likely to be hit by one as those in social class one. Road deaths are now lower than ever before, but only because the streets have been seized from the poor and handed to more prosperous people. While the children of richer people have gardens or quiet cul-de-sacs in which to play, the children of the poor must either run among the traffic or sit at home and watch the telly.... The rich move away from busy roads, leaving their pollution with those who can't escape. A study this year by researchers at the University of Colorado suggests that children living beside the most hectic highways are six times more likely to contract leukaemia and other childhood cancers than children in quiet places. Diesel engines emit the two most carcinogenic compounds ever detected. Traffic pollution may also be responsible for the catastrophic recent growth of Britain's commonest form of blindness. The poor subsidise the rich with their lives." [34]

 

 

 

3. Greener taxation, benefits for everyone

 

3.1 The Green Party strives for the twin imperatives of social justice and ecological sustainability. Therefore our taxation policies - commonly known as eco-taxation - intend to promote sustainability in the most equitable manner possible.

 

3.2 This is why the Green Party has been so critical of half-baked policies and proposals by Labour and Conservative governments and Liberal Democrat politicians. Anything which falls short of properly addressing climate change is not Green. Regressive taxation structures are not Green. Transport and fuel tax structures which impact most heavily on poorer people without even reducing traffic are definitely not Green.

 

The immediate term: Benefits to the environment, to local economies AND to poorer motorists

3.3 If Green policies were pursued, poorer motorists could be better off. The Green Party wants to shift tax liability from ownership onto fuel use, in order to encourage drivers to use their cars less and to opt for smaller, more fuel-efficient cars. Similarly the Greens want to support local economies and the smaller businesses which are vital to communities - to promote local production and supply for local need wherever practicable - and this would favour the struggling smaller enterprise, the family farm, the local shop, rather than the huge corporation. [35] Heavily taxing larger trucks (which have far higher external costs in terms of road damage and bridge strengthening requirements), while favouring smaller trucks travelling shorter distances, would benefit local economies and the smaller enterprises which are struggling against big business competition shifting cheap goods from abroad. And such policies would, of course, help reduce pollution.

 

3.4 A simple immediate step could be as follows:

·        Cut car tax by £100 on all cars under 1800cc.

·        Abolish car tax completely for cars 1100cc and under.

·        Restructure lorry tax, with an average cut of £1000 a year, but with the benefits of this going to smaller lorries, and much higher taxes on the biggest lorries.

·        This would balance with a 6p/litre increase in fuel tax over the next financial year (even allowing for a significant reduction in fuel use). This would leave the average driver of an 1100cc car £30 a year better off [36] and could significantly reduce traffic. [37]

 

The medium term: Better transport choices for everyone, better health, higher quality of life

3.5 In the medium term, poorer people would be the chief beneficiaries of Green transport policies. Public transport would be cheaper and more reliable, walking and cycling would be safer, pollution and resulting health impacts would be lower, and residential streets would be less hazardous. Disabled people, who are usually in lower income brackets, would benefit particularly from targeted investment to improve their transport choices.

 

3.6 Poorer people in rural areas, who often have no access to a car and virtually no option of public transport, would benefit far more from Green policies than from cheaper petrol. Much has been written recently about the impacts of fuel duty on rural areas, where there is greater car dependency. But DETR statistics show that rural motorists don't drive very much longer distances than urban motorists. Rural households drive, on average, only 600 miles a year further than the national average. [38] And 17% of rural households don't have cars - so lower fuel duty wouldn't help them. Clearly rural Britain needs much better public transport more than it needs lower fuel duty. [39]

 

3.7 It would be very easy for the government to make a serious start on the Greening of the UK transport system, in such a way that less wealthy people would be major beneficiaries. Reclaiming only about one-quarter of projected roadbuilding cash for sustainable alternatives, over and above existing government plans for the latter, could pay for the following:

 

·        10,000 residential streets redesigned as Home Zones (twice as many as in the Netherlands). [40]

·        Eight times as many bus lanes as we have at present, meaning better public transport. [40]

·        Comprehensive Safe Routes to School policies for every school and college in the UK [40] - which in turn would cut morning rush-hour traffic by 10%. [41]

·        Light rail systems for eight more cities, like those in Greater Manchester and Sheffield - which could replace many millions of car journeys every year and create 28,000-60,000 extra jobs. [42]

·        £4bn to reduce bus and rail fares, to be spent over a 10-year period.

·        £1bn specifically for improvements to rural public transport.

·        £1bn specifically for improving transport for disabled people.

 

3.8 This would be a financially modest start which the government could easily afford without increasing either income tax or business taxes, and without even cutting roads expenditure to the extent which the Greens would like. Nor would it tap the £15bn reserve allowed for in the government's 10-year transport plan.

 

The longer term: A socially just and ecologically sustainable society

3.9 In the longer term, the aim of Green taxation would be to improve social equity while facilitating ecological sustainability. [43] Tax liability would be shifted onto undesirable things like resource-depletion and pollution. Regressive taxes like VAT would be phased out. [44] [45] A Citizens' Income scheme would be introduced, and taxation overall would be redistributive of wealth.

 

3.10 Eco-taxation could play a major part in abolishing the involuntary unemployment which is endemic in a consumer-capitalist society. A Cambridge University study found that an escalatory road fuel tax, with its revenues pumped into job-creation through reductions in employers' National Insurance payments, could create over a million jobs over 10 years. This could save the Treasury over £10bn a year in benefits within 10 years.

 

 

 

Conclusion

 

Genuinely Greener, genuinely richer

C.1 It took Tony Blair four years to make a major speech about the environment. In it, he revealed that his understanding of the issue was about 20 years out of date. But he was right about one thing: that looking after our environment could make our lives richer. He could perhaps follow this realisation by understanding that taxation policy can make or break environmental aspirations; that a Green taxation structure could be the chief economic tool for promoting sustainability and social justice.

 

C.2 The Green Party awaits the introduction of such taxes. We are determined to hasten their adoption. And every voice in support of the Green Party and its policies, every new member, every vote at any political level, is a step towards the day when rhetoric makes way for reality; when society will be truly richer - by being truly Greener.

 

 

 

Notes

1. National Statistics data based on the Retail Price Index, cit Bolton et al, House of Commons Research Paper 00/69, 12.7.00, Road Prices and Taxation.

2. "The British motorist has never had it so good", Guardian 3.8.00.

3. The Road Danger Reduction Forum - a local government road safety organisation whose membership includes 26 local authorities - has written: "The costs of motoring are the same as they were in the 1970s. They went down in the 1980s – their rise is simply up to the level it was at some 25 years ago. In that time average incomes have gone up by 2 to 3 times. In terms of the average income, motoring has become very much cheaper."

4. The government's roads programme includes £60bn for roads 2000-2010, including 360 miles of motorway and trunk road widening and 100 new bypasses: DETR News Release 484, 20 July 2000.

5. D Maddison et al, The True Costs of Road Transport, Earthscan Publications Ltd, London 1996, p141.

6. CBI figures, cit Maddison 1993, ibid.

7. Maddison 1993, ibid.

8. Maddison 1993, ibid.

9. Fair Payment From Road Users? A critical look at the calculations for air pollution, David Maddison, Centre for Social and Economic Research into the Global Environment (CSERGE), University College London and University of East Anglia, for ETA Trust on behalf of: Council for the Protection for Rural England, Friends of the Earth, Royal Society for the Protection of Birds, Transport 2000, December 1998.

10. Note that in February 1998 the AA published a report entitled Fair Payment from Road Users: A Review of the Evidence on Social and Environmental Costs, written by Professor David Newbery of the Department of Applied Economics, University of Cambridge. This revised the figures for health impacts from Maddison's earlier £19.7bn to as low as £0.6bn a year. Maddison 1998 acknowledges the need for downward revision, but provides a sharp critique of the flawed assumptions in the AA report.

11. The Department of Health has published figures showing that up to 24,000 people die each year in the UK because of air pollution, and 31,000 are admitted to hospital: COMEAP (the Committee on the Medical Effects of Air Pollution), Department of Health, 1998. Maddison 1998 notes that: "Even on the basis of quite conservative estimates the residents of England and Wales will in aggregate lose something in the order of 15.7m years of life unless ambient concentrations of particulate matter fall significantly from their current levels. In addition, the air pollution generated by road transport will bring forward the deaths of at least 10,800 individuals each year. Thus, it is true to say that at least three times as many people are killed from the effects of air pollution generated by road traffic as die in road traffic accidents."

12. The Environmental Transport Agency estimates that external costs including damage to health, road deaths and casualties, landscape, bio-diversity, noise and severance of communities, amount to £42bn a year: The Real Costs of Motoring, ETA 1991 (updated 1996). A study commissioned by the British Lung Foundation estimates the

damage caused by driving to UK health, environment and infrastructure costs an annual £45 billion: cit George Monbiot, Guardian, 3.8.00.

13. A study of transport in Germany in 1993 calculated hidden costs of about £25 per 1000 passenger/km for car travel - ie every passenger travelling 1000km passed on costs of £25 to society (1993 prices) - seven times the hidden costs of rail travel: P Kageson, Federation for Transport & Environment, Stockholm, Getting the prices right: A European scheme for making transport pay its true costs, cit T Jenkins & D McLaren, Working Future? - Jobs and the Environment, Friends of the Earth UK, 1994, p82.

14. G Monbiot, Guardian, 3.8.00.

15. George Monbiot wrote recently: "In my neighbourhood, for example, a room about 3 times the size of a parking space costs £3500 a year to rent. Given that bricks and mortar account for less than 50% of the cost of the houses, and that no parking charges are levied, each car receives a free plot of public land worth some £500 a year. As streets become hostile to human life and even the pavements become impassable, as tens of thousands of acres on which houses could have been built are reserved instead for parking, the driver's access to land is underwritten by everyone in Britain": Guardian, 3.8.00.

16. Green Fuel Tax: The Case Against Cuts: Friends of the Earth UK, November 2000.

17. Global Commons Institute. See "defending the value of life," www.gci.org.uk/vol/vol.html.

18. For fuller details of the weather effects of climate change, see Out of the Frying Pan, into the Flood: Global Warming and Weather Disruption, Green Party, November 2000.

19. World Disasters Report 1999, International Federation of Red Cross and Red Crescent Societies, cit Environmental News Network, 24.6.99.

20. Christian Aid's briefing paper and Policy Position Paper on global warming can be found at: http://www.christian-aid.org.uk.

21. Munich Reinsurance, cit Paul Brown, The Guardian, 15.5.00.

22. Dr Edward Hill, Proudman Oceanographic Laboratory, cit Martin Bright, Observer, 6.2.00.

23. DETR figures.

24. Institute for Fiscal Studies, cit C Denny, "Tax rises fail to cut car journeys: Policy drivers say levies must be spent on public transport," The Guardian, 2.9.00.

25. Ibid.

26. Transport 2000.

27. "Present oil-crisis is a result of 20 years negligence of energy policy by EU Governments", press release from Greens/EFA in the European Parliament, 20.9.00.

28. Greg Muttitt and James Marriott, "Pump and circumstance: Why the oil companies stayed silent during the fuel crisis," The Guardian, 4.10.00.

29. See http://www.financialcrimes.com/pages/story9.htm.

30. Press release during the launch of its report Energy - The Changing Climate. See Chapter 5, paragraphs 5.46-5.60 of the latter for the RCEP's assessment.

31. Ibid. See Chapter 6, paragraphs 6.107-6.128.

32. Caroline Lucas MEP (Green Party, South East England, rapporteur for the European Parliament's Transport Committee on the environmental impact of the aviation industry), speech to the European Parliament, September 2000: further info from clucas@europarl.eu.int .

33. The Times 31.10.00; Manchester Evening News, 4.11.00.

34. G Monbiot, Guardian, ibid.

35. It's sadly ironic that eg farmers, in supporting fuel protests, are blaming their problems on fuel taxes. The Green Party is highly sympathetic to the plight of the agricultural sector, which according to the NFU has lost 22,000 jobs in the last 12 months. The National Farmers Union tells us that the average farmer will make a loss of around £4000 this year (further info from www.nfu.org.uk). But in fact it is cheap fuel, and government and EU policies based on promoting competition, which are undermining British farmers. It's cheap fuel which allows producers in warmer countries to undercut British farmers in the British market with produce which has traditionally been grown in Britain. Green policies of favouring less resource-intensive practices - including higher fuel prices - would support British food production for the British market, not hinder it. And studies have shown that government support for organic production could create tens of thousands of extra jobs: see Best of Both Worlds: Green policies for job-creation AND sustainability, North West England Green Party, 1999.

36. Figures extrapolated from Tony Grayling, Institute of Public Policy Research, in "More mileage", The Guardian 24.10.00. A 6p/litre increase in fuel duty would raise about £2.5bn in the year, and the suggested cut in vehicle tax would cost about £2bn.

37. Abolishing vehicle excise duty, and increasing fuel duty to compensate for this, would cut car use by 8% in one year: M Pearson & P Smith, Taxation and Environmental Policy: Some Initial Evidence, Institute for Fiscal Studies, 1990, cit Bolton et al, ibid.

38. Rural households drive on average 10,200 miles a year - 1000 miles a year more than households in large urban areas, and 2,400 miles more than households in London: DETR, Focus on personal travel 1998, cit Bolton et al, ibid, p31.

39. Households in rural areas make only 4% of journeys by public transport, compared with 20% in London and 9% in Great Britain as a whole: DETR, ibid.

40. Extrapolated from figures provided by Transport 2000: http://www.transport2000.org.uk.

41. Eco-logica environmental consultancy.

42. See T Jenkins and D McLaren, Working Future? - Jobs and the Environment, Friends of the Earth UK, 1994.

43. See the Manifesto for a Sustainable Society, Economics section, for details of Green Party taxation policy, at www.greenparty.org.uk .

44. Although VAT is often portrayed as a tax on consumption, it is really a tax on the spending of money. Sometimes spending money is entirely benign, and sometimes it has adverse social and/or ecological effects; and it penalises poorer people, who spend a higher proportion of their income on VAT than wealthier people when purchasing the same goods. Replacing VAT with genuine taxes on consumption would both address the regressive taxation problem, and be conducive to sustainability.

45. Currently VAT acts to amplify oscillations in the price of oil. People don't just pay VAT on fuel, but also on the fuel duty they're already paying. Major price-rises driven by the oil industry can be extremely inconvenient for individuals and businesses alike. Predictable price-rises (such as from an escalatory fuel tax) are much easier to plan for or avoid by switching to less fuel-intensive modes.