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Telegraph
30-03-2025
- Business
- Telegraph
Labour set to align Britain with EU net zero laws
Both carbon markets work by capping total emissions that can be released by polluting industries, which receive permits to emit greenhouse gases known as emissions allowances. Allowances can be bought and sold on the market. The higher the carbon price, the greater incentive not to pollute and to sell the allowance instead. On Friday, the carbon price per tonne of carbon dioxide equivalent in the UK ETS market was about £40.16, compared to £59.57 in the EU. Plans to link the markets were discussed at the last meeting of the EU-UK Parliamentary Partnership Assembly in Brussels this month. 'We do need to have closer alignment and a strong, stronger relationship in that space,' Marsha de Cordova, the Labour MP for Battersea and head of the UK delegation, said after the talks. Lord Livermore, a Treasury minister, recently told peers: 'We recognise that alignment with existing regimes can reduce administration burdens, so we will align where appropriate. 'We also continue to explore all options to improve trade and investment with the EU, which includes the UK and EU giving serious consideration to linking our emissions trading schemes.' Experts told The Telegraph that the UK would have to accept that the ECJ was the final arbiter of questions related to EU law governing the ETS. 'I imagine that would be seen as a strong requirement or pre-requisite, especially if there is still regulatory divergence,' said Sam Van den plas, policy director at Carbon Market Watch. 'You need to ensure the maximum amount of regulatory alignment, or realignment,' he said, adding it was important for market supervision and compliance. Parts of the Brexit Withdrawal Agreement are subject to ECJ jurisdiction. However, the trade agreement and UK involvement in the Horizon programme resolve disputes through independent panels. Baron Duncan of Springbank, now a Tory peer, was the lead MEP on reforms to the EU ETS before Brexit. He told The Telegraph that the pressure to align with EU policies would be intense. 'Everybody is out of step. So when you come back into the fold, you have to adapt very quickly to these EU initiatives and also be bound by the European courts, which will agitate the Brexiteers,' he said. He added that British businesses would not necessarily be ready for the 'judder' of a steep increase to the EU prices if the UK rejoins. Pressure to stay aligned The UK and EU both have the same goal of net zero by 2050, although the jurisdictions have different staging posts in the timeline to reach that target. Simply linking the two markets will not tie a future government's hands over net zero, although there will be pressure to stay aligned. The UK ETS covers energy-intensive industries such as steelmaking, power generation and aviation. From 2027, the EU will also introduce carbon pricing on road transport and building, making 75 per cent of the bloc's emissions covered by a carbon price. When the UK ETS was set up on January 1 2021, it was basically a copy and paste of the EU system, but there has been divergence in the rules since. The UK offers more allowances in some industrial sectors than the EU, which would have to be removed. The British mechanism to remove surplus allowances to the market and protect it from financial shocks is also slightly different to the EU's and will have to change if the UK rejoins. There is another incentive for Sir Keir to align with Brussels; the EU's plans for a carbon tariff border wall, which will come into force in January. The Carbon Border Adjustment Mechanism (CBAM) imposes tariffs on imports from outside the EU to prevent unfair competition with products made under lower and cheaper environmental standards. British businesses risk finding themselves on the wrong side of the tariff wall and vulnerable to increased costs. A UK CBAM is not scheduled until 2027, a year later. Rejoining the EU ETS could help reduce costs and simplify compliance for British exporters of products including fertiliser, cement, aluminium and hydrogen. It will also help avoid another politically toxic headache over Northern Ireland's Brexit deal. Under the Windsor Framework, Northern Ireland would have to apply the EU's carbon border tariff to British imports even though it is also part of the UK. Formal negotiations on linking the two markets have not yet begun. EU governments must first give the Commission a mandate to start talks. There is a UK-EU summit on May 19, which could pave the way for those negotiations, as well as trade talks, a possible youth mobility deal, and a defence pact.
Yahoo
24-03-2025
- Business
- Yahoo
Peers seek tax rise safeguards for health workers
Peers have renewed their attempts to block government plans to raise employers' national insurance for health and social care workers. Over the past month, the House of Lords has delivered a series of defeats on the bill to increase National Insurance Contributions (NICs) from13.8% to 15% - and lowering the earnings threshold from £9,100 to £5,000. Peers had attempted to secure exemptions for hospices, care homes, GP practices, dentists and pharmacies - but MPs rejected their plans. On Monday, peers approved proposals for a new law to allow ministers to introduce such exemptions further down the line - meaning the NICs plans remain stuck in parliamentary limbo. What is NI and how much do workers and employers pay? Hospices in England to receive £100m funding boost The bill will continue to be batted between the Commons and the Lords until agreement is reached, in a process known as "ping-pong". Liberal Democrat peer Lord Scriven called his amendment an "olive branch" after weeks of deadlock with the government. The plans do not deny "the right of the government to raise revenue", he said, but instead gives ministers "a tool to act swiftly with the consequences of what may happen and probably what will happen in health and social care." Labour Treasury minister Lord Livermore said any changes to exempt certain groups from NICS "would have cost implications necessitating higher borrowing, lower spending or alternative revenue raising measures." The government recognised the "vital role" played by hospices, he said - highlighting the extra £100m being provided to the sector, with a further £26m in funding for the support of terminally ill children and young people. Charities, including hospices, also benefit from the increased employment allowance that would reduce their national insurance bill, he argued. On Monday, peers also approved two other changes to the NICs Bill. Peers voted for a measure that would open the way for a carve-out for small businesses and organisations from the lower earnings threshold at which employers start paying contributions by 276 to 165. The Lords also supported by 273 votes to 172 a Tory amendment which would require the Chancellor to present an impact assessment of the tax rise on a range of sectors, including hospices, small charities and businesses, the hospitality industry and children's nurseries. Sign up for our Politics Essential newsletter to read top political analysis, gain insight from across the UK and stay up to speed with the big moments. It'll be delivered straight to your inbox every weekday.
BBC News
24-03-2025
- Business
- BBC News
Peers seek tax rise safeguards for health workers
Peers have renewed their attempts to block government plans to raise employers' national insurance for health and social care the past month, the House of Lords has delivered a series of defeats on the bill to increase National Insurance Contributions (NICs) from13.8% to 15% - and lowering the earnings threshold from £9,100 to £5, had attempted to secure exemptions for hospices, care homes, GP practices, dentists and pharmacies - but MPs rejected their Monday, peers approved proposals for a new law to allow ministers to introduce such exemptions further down the line - meaning the NICs plans remain stuck in parliamentary limbo. The bill will continue to be batted between the Commons and the Lords until agreement is reached, in a process known as "ping-pong".Liberal Democrat peer Lord Scriven called his amendment an "olive branch" after weeks of deadlock with the plans do not deny "the right of the government to raise revenue", he said, but instead gives ministers "a tool to act swiftly with the consequences of what may happen and probably what will happen in health and social care."Labour Treasury minister Lord Livermore said any changes to exempt certain groups from NICS "would have cost implications necessitating higher borrowing, lower spending or alternative revenue raising measures."The government recognised the "vital role" played by hospices, he said - highlighting the extra £100m being provided to the sector, with a further £26m in funding for the support of terminally ill children and young including hospices, also benefit from the increased employment allowance that would reduce their national insurance bill, he Monday, peers also approved two other changes to the NICs Bill. Peers voted for a measure that would open the way for a carve-out for small businesses and organisations from the lower earnings threshold at which employers start paying contributions by 276 to Lords also supported by 273 votes to 172 a Tory amendment which would require the Chancellor to present an impact assessment of the tax rise on a range of sectors, including hospices, small charities and businesses, the hospitality industry and children's nurseries. Sign up for our Politics Essential newsletter to read top political analysis, gain insight from across the UK and stay up to speed with the big moments. It'll be delivered straight to your inbox every weekday.
