I have been working on the Green Budget Reform project as a part of a team of volunteers at Umanotera, a Slovenian NGO, for a while now. Our goal is to prepare examples and practical suggestions of possible implementation of the Green Budget Reform. The main event of this project was a conference, which gathered prominent international speakers as well as some important decision makers in one place. It took place on Thursday, 20th of September 2012 under the title “Zelena proračunska reforma kot mehanizem izhoda iz krize”, which could be roughly translated into “Green budget reform as a mechanism for exiting the financial crisis”. If you can read Slovenian, here is the pdf of the invitation and the program of the conference (in Slovenian). It was prepared by Umanotera with the support of the British Embassy in Slovenia and Green Budget Europe.
The conference featured an impressive cast of established professionals in this field, highlighted by Kai Schlegelmilch and Robin Smale. Kai Schlegelmilch was a key contributor in the success story of the Green Budget Reform in Germany and vice-president of Green Budget Europe. Robin Smale is the director of Vivid Economics , a British company that has done a lot of research relevant to the Green Budget reform.
Most of the speeches were very interesting. After an introduction by Vida Ogorelec, in which she mostly discussed climate change (a topic that instead of gaining media attention as issues get more critical is instead losing it), the organizers played a video message from commissioner Janez Potočnik, who talked about European strategy 2020 and the importance of accepting green policies in Slovenia.
After Branko Ravnik, state secretary at Ministry of Environment, came both foreign speakers. Robin Smale stressed that using carbon as a tax base gives much better results than using energy. Implementing carbon tax has similar effect on the economy as increasing VAT (both carbon tax and VAT have a lesser negative impact than labor tax). He also talked about the problems with CO2 taxes and solutions to those problems (I won’t write more here, but if you’d like to know more, please ask via the comment section). He also discussed the social aspects of raising carbon tax – the poor are the most affected by this kind of tax raise and have to be compensated, but this is not too expensive (the cost of compensations is 5-10 % of new tax revenue).
Kai Schlegelmilch started with saying that state has to tax the bads and stop taxing the goods. Pricing is the best measure to make people use natural resources responsibly. Education and propaganda reach 10 % of the people, while pricing reaches the other 90 % and affect their decision-making. He stressed that business as usual is not an option and that we have to act quickly. He talked about the history of green taxes. Most breakthroughs in this area happened in Nordic countries like Denmark and Sweden.
It was very interesting that Germany managed to significantly tax CO2 even though they have a very powerful automobile industry lobby. I have discussed that with German attendees after the conference and they told me there was a big opposition to introducing this tax, but the government managed to implement it in spite of the strong opposition. The green tax reform was started by a left-wing government and it continued even though the right-wing option came into power. I think this is a great example for Slovenia and that Slovenian politicians should try to take after their German colleagues in this area.
After the break came Slovenian speakers. Most of them were good, but I won’t go into detail since this post is already quite long. To me the most interesting speaker was Jernej Stritih, who discussed European ETS auctions and what to do with the profits from them. Economical Faculty of University of Ljubljana also made an interesting analysis using a model, but unfortunately some flaws were exposed during the questions phase.
Near the conclusion Jonas Sonneschein took the podium. He talked about the Green Budget Reform in Slovenia. He also presented the propositions that he prepared with our help and financial benefits of these propositions. I won’t go into them now since this post is already very long, but I’ll try to make a post about them in the coming week.
I’d like to thank Nina Tome, Jonas Sonneschein and the rest of the organizers for preparing such a great conference and congratulate them on a job well-done. The conference was very informative and brief enough to not become boring (if have interest in the subject, of course). As I’ve stated before, some decision makers were present – now we have to wait and see if any of these propositions receive consideration in the parliament and actually get implemented.
Update – 25.9.2012: Umanotera made more resources (various articles, presentation slides from presenters,…) available on their website recently. There is also a short report from the conference (most of this stuff is in Slovenian).
Update 2 – 28.9.2012: Some conclusions about the technical part of the conference (gathered from the questionnaires that were handed out):
- The conference met the expectations of 72 % of attendees, exceeded expectations of 24 % and was below the expectations of 4 % attendees.
- The average grade (1-5) of all aspects of the conference was 4,4. The highest rated aspect was organisation (4,7).