The UK is to use the warnings of irreversible climate change and the biggest economic slump since the 1930s, outlined in yesterdays Stern review, to press for a new global deal to curb carbon emissions. The government is urgently pushing ahead on the issue because the existing Kyoto protocol runs out in 2012, and there is no binding agreement to extend it. Downing Street is seeking the outline of a package with the G8 industrial nations and five leading developing countries by next year, or 2008 at the latest.

Tony Blair will lobby the German chancellor, Angela Merkel, to put the need for international cooperation on climate change at the heart of Germanys G8 presidency when it begins in January. In a clear sign that the issue unites No 10 and the Treasury, Gordon Brown will also be pushing for a radical rethink of the United Nations and the World Bank which, he believes, are not equipped to oversee a carbon trading scheme, including the principles on which carbon emission allocations would be handed out to individual countries.

Downing Street sources said the prime minister wanted a framework that included a target for stabilising CO2 emissions, a global scheme to cap and trade carbon emissions, a global investment fund for new green technologies and action to stop deforestation. The agreement would include three countries that were not part of Kyoto - the United States, China and India.

Launching the review into the economics of climate change by the Treasury economist Sir Nicholas Stern, the prime minister said: "Without radical measures to reduce carbon emissions within the next 10-15 years, there is compelling evidence to suggest we might lose the chance to control temperature rises."

The review said a "business as usual" model could result in temperatures rising by 5C above pre-industrial levels, leading to a cut of 5-20% in global living standards. Mr Brown, who shared a platform with Mr Blair at yesterdays launch, said it was no longer enough for economic policy to be based around growth and full employment. "In the 21st century, our new objectives will be threefold: growth, full employment and environmental care."

Both prime minister and chancellor accepted that green taxes would have to form part of the solution to global warming. Treasury sources said tackling the threat of climate change would form the centrepiece of a Brown premiership and that the chancellor was preparing to reject recommendations from the imminent Eddington review on transport if, as expected, it proposes widescale roadbuilding and aviation growth. The review is due to be published before next months pre-budget report and is seen inside government as a test of the governments green credentials.

The Treasury is also sending Sir Nicholas on a tour of China, India, the US and Australia to set out British thinking and press home the central thesis of his review - that it will cost the world far more later if it does not spend money now to avert climate change.

In an attempt to shore up the governments domestic record on climate change, the environment secretary, David Miliband, rushed out a Commons statement promising that the government will legislate in the next parliamentary session to put into statute a long-term goal of reducing CO2 emissions by 60% by 2050. Interim, but not the annualised targets sought by the opposition and some Labour backbenchers, will be set.

The bill will also set out an independent body - the carbon committee - to work with the government to reduce emissions. The committee is expected to be modelled on the monetary policy committee of the Bank of England. The bill will also create enabling powers to put in place the new emissions reduction measures needed to achieve these goals.

But, reflecting the speed with which the government has backed the principle of the bill, ministerial sources were unable to say what sanctions would be imposed on the British government or industry if targets were not met.
(By Larry Elliott and Patrick Wintour, The Guardian, 31/10/2006)
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