BAILOUTS FOR STRUGGLING FIRMS SHOULD BE CONDITIONAL ON IMPROVEMENTS AGAINST CLIMATE-POSITIVE CRITERIA, ESPECIALLY FOR FOSSIL FUEL INTENSIVE COMPANIES SUCH AS AIRLINES
Protecting our environment is everyone’s responsibility. We believe in supporting businesses in times of emergency but only when they are willing to protect workers, pay tax and meet stringent green targets.
THE PROBLEM
- Recovery packages for the economy after coronavirus will cost the taxpayer billions of pounds.
- Heavy polluting industries have been attempting to use the pandemic to weaken the drive towards sustainability.
- The IEA found that government fossil fuel subsidies total £300bn each year.
- Airlines asked for multi-billion-dollar bailouts but argue that adding sustainability demands on top of the current crisis is another economic burden that they do not need.
THE SOLUTION
- Stop subsidies to fossil fuel companies.
- Apply conditions to bailouts.
- Conditional bailouts for airlines could require the achievement of net-zero emissions by 2050 with intermediate targets set at 5 or 10-year intervals. If airlines failed to meet targets, bailout funding would be converted to equity so that the taxpayer could own a stake.
THE OUTCOME
- Airlines and other high-polluting industries would be forced to focus on sustainability immediately.
- Industry will look ahead to long-term survival in the short term.
- These policies would bring government efforts in line with consumer wishes: in a Publicis Sapient survey 66% of respondents said they would be more likely to purchase from an airline that has increased its sustainability efforts, and 73% said they are paying attention to brands that are making a positive impact during the pandemic.
LEARN MORE: POLICIES IN ACTION
Air France
Like many airlines around the world, Air France has required a tax-payer to bailout to survive the impacts of COVID-19. Unlike other governments, however, France has imposed strict environmental conditions including to halve its overall carbon-dioxide emissions per passenger-kilometer by 2030, compared with 2005 levels.
References
- Never wasting a crisis: industry lobbying during the COVID-19 pandemic exposed.
- Coronavirus: which governments are bailing out big polluters?
- Never wasting a crisis: industry lobbying during the COVID-19 pandemic exposed.
- Airline bailouts set to double.
- Bailout airlines but only if they start paying tax and using cleaner fuels.
- Bailout aviation sector – but make it conditional on the climate plan, says Labour.
- Coronavirus poses a threat to climate action.
- Why airline bailouts are so unpopular with economists.
- Bailout airlines but only if they start paying tax and using cleaner fuels.
- What COVID-19 can teach airlines about sustainability.
More information on the policies in action