How China ensured it was an unfair COP

Here's what really happened to scupper the climate summit

The truth about what happened at Copenhagen will not be easy for many people to hear, because it challenges everything they think they know about the world.

Yes, the "deal" was atrocious -- no long-term targets, no peaking year for emissions, no legally binding framework. What no one seems to properly understand is why such high hopes were dashed with such devastating failure.

The truth is this: a better deal was blocked by powerful nations in the developing world, in particular China. Several of those present in the room as heads of state from more than 20 countries battled it out late into the final night confirm this essential truth, and that Chinese attitudes and behaviour were at times deeply shocking.

Consider that the Chinese premier, Wen Jiabao, did not deign to attend the heads of state meeting, instead sending a middle-ranking official to sit at the table with Obama, Merkel, Sarkozy, Australia's Kevin Rudd and leaders from Grenada, Ethiopia, Maldives, Brazil, Mexico and others.

The Chinese have a reputation for being highly status-conscious. There is little doubt that this was a calculated diplomatic slight, aimed, perhaps, at the American president. Instead, all these world leaders, Obama included, were forced to wait as the Chinese delegate went to consult his superiors, or alternatively to attend separate bilaterals with the Chinese premier as he held court in a nearby luxury hotel.

I was attached to one of the delegations whose head of government attended nearly all the top-level negotiations among leaders and, as senior adviser, I had the opportunity to be present in the room where the intense top-level negotiations took place. Moreover, what took place in the heads of state meeting room and other parallel negotiations is confirmed by multiple high-level sources.

They emphasise that it was the Chinese delegate who insisted on tinkering with the 1.5 degrees Celcius temperature target -- crucial to the survival of small-island states -- until it was largely meaningless. China and India together also removed any mention of a peaking year for emissions (essential to keep temperature rises below even two degrees) or any long-term target for global emissions reductions by 2050, fearing that this would threaten their growth.

Most egregiously, it was China that insisted also on the removal of any mention even of rich countries' own targets -- initially suggested as 80 per cent by 2050. It is known that Angela Merkel in particular was incensed that even previously agreed and publicly announced targets by industrialised countries should also be excised from the text. Australia's Kevin Rudd, too, protested strongly. But China stood firm and the targets disappeared.

When the text became public, it was western leaders who stood excoriated for having "weakened" the Copenhagen Accord. At the final conference plenary after the announcement of the "deal", the Sudanese delegate Lumumba Stanislaus Di-Aping (leader of the G77 and China group of developing countries) tore the agreement apart, suggesting that the weakness of its targets made it "murderous" to Africans.

What he did not mention was that it was his patrons, the Chinese (who have large investments in Sudan), who had gutted the much stronger, original deal pushed by the western leaders in the first place. Di-Aping's comparison of the accord with the Holocaust was not just offensive and inappropriate, it was also grimly ironic, given that Sudan's own head of state was unable to attend the meeting because he has been indicted by the International Criminal Court for war crimes.

One of the heroes of the hour was our own Ed Miliband, who saved the conference from certain failure by intervening to move an adjournment seconds before the Danish prime minister (who was chairing) was about to throw in the towel. Gordon Brown, too, emerges with credit, having kept the $100bn financing provision for developing nations in the final text.

So what is China's game? Clearly the country is beginning to assume the mantle of a global superpower, and the picture is not pretty. Any suggestions of constraints on its coal-based growth are roundly rejected. It was clear to me that a collapse of the entire process would also have been just fine with China in particular, and probably India as well.

If this is how China plans to use its growing might over future years and decades, we are all in deep trouble. I came to Copenhagen full of optimism and hope. I left with a sense of deep foreboding and near despair.

A version of this piece by Mark Lynas will appear in the 4 January 2010 issue of the New Statesman.


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Mark Lynas has is an environmental activist and a climate change specialist. His books on the subject include High Tide: News from a warming world and Six Degree: Our future on a hotter planet.
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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.