Vince Cable outlines Lib Dem policy at Green Alliance

5th March, 2010

Economic affairs spokesman for the LibDems, Vince Cable, spoke at a Green Alliance conference (also attended by AEF’s Cait Weston). Here is what he said about aviation.

“We suggest that one useful step forward is to introduce realistic pricing for aviation in ways that circumvent the treaty restrictions on taxing aviation fuel. Aviation is a rapidly growing source of emissions and the last redoubt of the old idea that polluters don’t and won’t pay.

Aviation has unfair, distorting tax advantages over competing modes of transport, notably long distance rail, because there is no tax on fuel, no charge for landing rights which, in a sensible world, would be auctioned (and in contrast to the track charges imposed on rail operators) and with subsidised landing charges (cross-subsidised by shopping in the bizarre, Alice in Wonderland world of aviation regulation). As a result aviation does not pay for carbon, or localised – nitrogen dioxide – pollution or the disamenity of noise, especially at night.

We suggest as one – modest – first step: changing the tax base, and increasing tax, by applying it to flight take-offs in a way which captures the emissions generated by the engines and flight distance and scrapping the current ticket tax which penalises the efficient use of aircraft and doesn’t tax air freight. We would aim to raise £2.6bn from this green tax which would contribute towards cuts in direct taxation on the low paid.

We are also opposed to the current ‘predict and provide’ approach to airport expansion in the South East. We hope that the Conservatives will be as good as their word in working with us to stop Heathrow expansion in particular.”

AEF supports these views. But the Lib Dems will need to be bit careful on the tax dodges and ‘polluter pays’ issues. While they are absolutely right to point out aviation gets unfair and unjustified privileges, it should be noted that rail travel also does not pay taxes on its emissions. While emssions from railways are much less, there nonetheless needs to be robust position on the issue when challenged by the aviation industry.