Fiscal actions must be taken which can attack both emergencies

Policymakers must urgently accelerate investment in climate action in Scotland, a coalition of 60 civil society groups has urged.

This must be done while at the same time addressing the cost of living crisis and funding the country’s commitments to international climate justice.

Stop Climate Chaos Scotland has released a new report, which was commissioned to better understand how the generation and use of public finance can do more to support the delivery of Scotland’s climate ambitions. 

“Financing Climate Justice: Fiscal measures for climate action in a time of crisis” examines how public revenues should be raised, and ways it could be spent to help deliver Scotland’s emissions targets, while supporting global climate justice.

It examines how current fiscal measures can be used better, for example, to provide for warmer, better insulated homes as well as free public transport. The report also considers potential new measures to help drive and enable the public and businesses to change behaviour to reduce emissions. 

Importantly, the report highlights how richer countries’ emissions are driving repeated climate catastrophes in low and middle-income countries with lives, homes, livelihoods and land being lost, draining their national budgets.

The report, written by the independent environmental consultant, Dr Richard Dixon, a former director of Friends of the Earth Scotland and WWF Scotland, acknowledges the deep financial pressures created by the cost of living crisis and argues that actions to tackle it can and must complement those required to avert even deeper climate chaos. 

Scotland is making progress in cutting emissions, but it has missed three out of the last four legal annual targets and the Committee on Climate Change warns that future targets will be “very difficult to meet” and says the focus must be to “deliver against the commitments that have been made”. This requires urgent and sustained new investment.  

The report makes recommendations to raise more revenue, incentivise and enable behaviour change by polluters, and to increase investment in activities within the sectors in the Scottish Government's Climate Change Plan. Some could be implemented immediately or quickly; others would need more detailed consultation and analysis. 

A key conclusion is that the climate crisis is of such a scale and urgency that measures to address it should be funded from general taxation, with this complemented by environmental taxes primarily aimed at changing behaviours. Critically, the report adopted the ‘polluter pays’ principle – meaning that those who are responsible for climate emissions should pay for the cost to society – and also considered the speed with which the measures could be implemented, and the importance of ensuring those on low incomes are protected.

Mike Robinson, chair of Stop Climate Chaos Scotland, said: “If we are serious about tackling the climate emergency, we must use our tax and spending powers to drive faster change, while increasing the finance available.  

“This is clearly a tough time financially, but the climate emergency hasn't gone away and if we don’t ensure we increase the funding spent on tackling it, we are taking a huge gamble with our future, and risk simply lurching from one short-term crisis to the next. 

“All countries, particularly rich industrialised ones, like Scotland, share this challenge, and we must act sooner rather than later, and, crucially, there are profound benefits to the climate, society and all of us, if we get this right. 

“We don’t claim to have all of the answers, but these proposals must be urgently considered and acted upon to deliver on Scotland’s climate ambitions and to fulfil our moral obligations to those facing deep climate impacts.” 

The report, which includes recommendations for the UK and Scottish governments, as well as local authorities, comes on the eve of Cop27 in Egypt, where low income and climate vulnerable countries will push for increased financial support from rich, high-polluting nations to help them deal with deep and spiralling climate impacts.