Transforming environmentally harmful subsidies into socio-ecological investments
Reduction of environmentally harmful subsidies creates the financial means for a sustainable policy. Source: PhotoSG / Fotolia.com |
It is paradoxical; the German state is promoting the switch to more climate-friendly electric cars through purchase premiums – and at the same time diesel fuels and the private use of petrol and diesel company cars through tax privileges. Economic incentives of this kind in opposing directions counteract effective climate and environmental protection and cost us all unnecessarily. Germany spent more than 65 billion euros in 2018 on subsidies that have a negative impact on the climate and often also on air quality, health and raw material consumption, according to the latest UBA figures. Almost half (47 per cent) went to the transport sector, and another 39 percent to energy supply and use, such as energy tax breaks for business.
By changing national regulations alone, Germany could generate additional revenues in the double digit billion range by reducing environmentally harmful subsidies. These revenues could then be used for socio-ecological investments, for example, supporting companies in switching to greenhouse gas-neutral production methods or ensuring upgraded and affordable bus and rail transport. The dismantling of environmentally harmful subsidies is also necessary in some cases on grounds of social justice. One example is the private use of company cars, which the state subsidises with at least three billion euros per year. "This mainly benefits households with high incomes. This subsidy is not only harmful to the environment, but also socially unjust. It should be abolished," says UBA President Dirk Messner.
The UBA has presented concrete reform proposals that both advance environmental and climate protection and take social goals into consideration. Fundamentally, only subsidies that are in line with sustainable development should be granted.