England & Wales Climate action and sustainable development , Economy and regeneration , Housing and planning , Welfare and equalities

Protecting Low-income Households from Reducing Carbon Emissions

Summary

This briefing deals with two reports published by the Joseph Rowntree Foundation on the distributional effects of policies to reduce carbon emissions.

The first assesses the impacts of different energy and climate change policies on households (including impacts on consumer energy bills), and their effectiveness in reducing carbon emissions.

The second examines how compensations in the tax and benefits system could ensure that no (or few) low-income households would be worse off as a result of carbon taxes on household energy use and transport. These are important issues because, unlike taxes on income or wealth, ‘green taxes’ do not always relate directly to ability to pay.

In the first report, it is concluded that current settings for energy and transport policy are regressive in that costs are imposed more on lower-income groups.

In the second report, it is concluded that increases in the levels of Universal Credit and other benefits would be required to offset the burden of higher carbon taxes.

This briefing will be of interest to officers and members in all councils involved in housing, the environment, welfare and fuel poverty issues and corporate policy.

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