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CPA: Environmental efficiency recieves little encouragement from Budget

Despite all the expectations that the Chancellor would deliver a budget to encourage environmental efficiency, the measures outlined today fall well short of what is needed to address the climate change issues and deliver a more sustainable future.

Speaking after the budget announcement, Michael Ankers, Chief Executive of the Construction Products Association said; "There is an urgent need to make existing buildings more energy efficient, but the Chancellor has missed a great opportunity to provide financial incentives to achieve this. Whilst plans to exempt new zero-carbon homes costing up to £500,000 from stamp duty are to be welcomed, these are very modest measures given the scale of what has to be achieved with the overwhelming majority of existing homes - new homes only account for 1 % of total stock in any given year. An incremental improvement to the energy efficiency of existing homes of 1% each year would more than outweigh the environmental benefits produced by building all new housing to zero carbon.

"The Government must develop its strategy to make the existing building stock more energy efficient if it is serious about reducing carbon emissions and improving energy efficiency. There are a number of ways to help all householders improve energy efficiency, but this budget has done little to encourage any improvements. The financial grants to help pensioners insulate their homes may be good for their quality of life, but this is a social policy, when what is needed is a strategy to reduce emissions from all the existing housing stock.

Turning to the issues in the budget aimed at improving business competitiveness Michael Ankers said; "It is unlikely to deliver significant wins for UK Plc - despite the cut in Corporation Tax to 28%, but we welcome the measures in the Budget to assist industry competitiveness. We are pleased to see the Government remains committed to reducing red tape through simplification of the tax system and are particularly pleased that Corporation Tax has been cut, however the rises in taxation for smaller firms mean the overall fiscal burden on businesses has not been significantly reduced by this budget".

Other key aspects of the budget include.
. Climate Change Levy (CCL) has increased inline with inflation. We wait to see the detailed proposals for simplification of the CCL. The CCL does little to make companies more energy efficient and risks encouraging them to look elsewhere when it comes to making future investment decisions.'

. There is an increase in the Aggregate Levy to £1.95 per tonne from 1 April 2008. This will increase the cost of construction for infrastructure projects and major schemes like the London Olympics.

NOTE TO EDITORS:
The Construction Products Association represents the UK's manufacturers and suppliers of construction products, components and fittings. The Association acts as the voice of the construction products sector, representing the industry-wide view of its members. The sector has an annual turnover of £40 billion and accounts for 40% of total construction output.

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