The meeting of the Environment, Spatial Planning and Energy Committee of the Council of States (ESPEC-S) on 11 February could go down as a turning point in the history of Swiss climate policy. In deliberating on the new CO2 law, the Committee has adopted positions that have been championed for years by Alliance Sud and the Climate Alliance: it wants to significantly tighten the Federal Council's draft and expressly enshrine the goals of the Paris Climate Agreement in Swiss law. According to the ESPEC-S press release the Committee "decided unanimously that the law should help limit the rise in the earth's temperature to 1.5°C and enhance adaptability to climate change."
In the light of the Centre-Right’s stonewalling on this issue so far, the notion that in addition, "financial flows should be aligned with the desired low-emission development" seems well-nigh revolutionary. For it means nothing other than that the world's largest offshore investment and financial centre is to be groomed to be climate-friendly. The question of how will be discussed by the Committee at its meeting on 1 April. It remains to be seen whether the Committee's proposal will withstand the foreseeable counter-attack from the influential finance lobby in the Council debate.
The mid-February announcement by FDP President Petra Gössi of her wish to commit her party to a climate-friendly course is a further sign of an incipient turnaround in Swiss climate policy. Whether the call for looking at "making the polluter-pays principle the basis for the international climate funding contributions that must be paid anyway" — one of the main demands of Alliance Sud, it should be noted — is anything more than electioneering tactics will perhaps become clear only in the new Parliament. After the inglorious role of the FDP in defeating the CO₂ law in the National Council, there are good grounds for doubt.
Incentive taxes with earmarking
Of much greater significance than the surprising forward somersault by many on the Centre Right is the Legal Opinion "International climate financing" tabled in late February by the renowned law firms ettlersuter and Hauser. The top-flight team of constitutional and environmental lawyers meticulously shows that there is no constitutional impediment to earmarking revenues from the CO2 or other taxes (including even an airline ticket tax) for international cooperation on climate change. On the contrary, the Opinion argues that it is legal to allocate not just some but all of the revenue from climate-related incentive taxes to climate protection measures in developing countries; this expressly includes emission mitigation and climate adaptation measures as well as action to strengthen the resilience of especially vulnerable populations and regions.
But what to those not versed in legal matters may sound extremely complicated though not spectacular, is precisely that: the Legal Opinion lays the groundwork for a veritable paradigm shift in Swiss climate policy. Throughout its 120 pages it cogently refutes the argument wielded for years by politicians and the Administration whereby revenue from incentive taxes should not be used for international climate financing without constitutional amendment.
Even a possible restriction is being relativized: the Constitution contains a proviso for federal taxes, designed to protect the tax base of the cantons. For an amount of up to 1 billion francs per year – in other words the amount calculated by Alliance Sud as Switzerland’s contribution to climate funding – the proviso cannot be invoked.
The relevant articles of the Federal Constitution
The rationale given in the Opinion is rooted in two largely sufficient articles of the Federal Constitution:
- Article 74 defines environmental protection as a cross-cutting function of the Confederation. This legitimizes measures against climate change as a global environmental problem “that can only be tackled through international cooperation and action at both the domestic and international levels.
- Article 54 for its part assigns general and comprehensive responsibility for foreign affairs to the Confederation. This also specifically covers matters relating to the international climate regime. The Opinion states that Article 54 of the Constitution itself already constitutes sufficient basis on which to levy climate-related incentive taxes for the purposes of climate funding. And because in particular adaptation measures in developing countries help “alleviate suffering and poverty”, the proceeds from such taxes can clearly be used also for that purpose, pursuant to Article 54 of the Constitution.
The Opinion commissioned by Alliance Sud also applies these insights to the current draft CO2 law tabled by the Federal Council and criticizes its failure to offer either a basis for contributions to international cooperation on climate or specific mechanisms for the funding of such cooperation.
The Opinion is particularly harsh on the Federal Council's report titled "International climate funding" published in May 2017. In it, while failing to explore in any depth the question of the use of tax revenues, the Federal Council takes the view that most of the funding mechanisms would require a constitutional amendment and are therefore "hardly feasible". It is most interesting to note that the report is based on a 2011 inter-departmental analysis that had long been kept under lock and key. This confirms a criticism voiced by Alliance Sud as long as two years ago: as regards Switzerland’s annual climate funding contributions of some 1 billion francs, to fall due in 2021, the Federal Council is still refusing seriously to explore new funding mechanisms for raising the requisite additional funds on a polluter pays basis. Instead, the Paris obligations for addressing the climate emergency are to be funded from the limited development cooperation budget.
Paris dissected at the domestic level
In legally deriving these positions, the Opinion interprets other aspects of the Paris Climate Accord that offer guidance as to how Switzerland could shape its climate policy.
- The Paris Climate Agreement "does not address greenhouse gas emissions in isolation but the solution of the climate problem as a whole", and this encompasses both mitigation and adaptation measures. From this perspective, an incentive tax on greenhouse gas emissions ultimately contributes to resolving the climate problem.
- Man-made climate changes are not natural disasters, and adaptation measures cannot be equated with managing the consequences of natural disasters. Because the Paris Climate Agreement has shifted the emphasis from adaptation to emission reduction, the focus is on "preventive limitation of the harmful effects of climate change and the strengthening of resilience". This means that adaptation measures "could also be funded with proceeds from an incentive tax on greenhouse gas emissions".
- Action to cut emissions in developing countries (mitigation) presupposes the strengthening of those countries' capacity to withstand climate change (resilience). Anyone who views emission mitigation as the top climate protection priority for the purposes of tackling the causes must therefore equally support adequate climate funding –especially for adaptation measures and the buttressing of resilience in Least Developed Countries (LDCs) and Small Island Developing States (SIDS).
- Climate funding cannot (continue to) be viewed merely as a quid pro quo for the agreement of developing countries to cut their own greenhouse gas emissions. Instead, it represents a contribution by industrialized countries to reducing their own carbon footprint and its impacts beyond their national borders. This is "all the more crucial as many industrialized countries no longer themselves produce goods with a heavy CO2 footprint, but import them from developing and emerging countries". They therefore share the responsibility for those countries' domestic emissions.
Alliance Sud stance fully vindicated
Lastly, the Opinion states that a flight ticket tax could be introduced purely as an incentive tax in accordance with international law and the Constitution, and that its proceeds could go towards international climate funding. On this point the Opinion clearly contradicts the position long held by the Federal Council in responding to various parliamentary motions.
For many years Alliance Sud and its allies have been lone voices in the wilderness calling for #climatejustice and #climatefunding according to the polluter pays principle. Meanwhile, concepts such as #climateemergency or #climateresponsibility are no longer to be seen only on social media and on banners being carried by school children striking in defence of the climate, but also on election campaign pamphlets. We will of course have to wait and see whether the emerging trend reversal of recent weeks will in fact be followed by concrete #climateaction. Ultimately, it will be up to voters on 23 October to turn fashionable hashtag terminology into a #climatechangeelection.