For many years, governments have used taxes and subsidies to achieve social, economic and environmental objectives. UK examples in the social and economic area have included employers’ National Insurance, selective employment tax, regional development grants, inheritance tax and the recently announced child trust fund. Other examples of internalisation of external costs include the charge to football clubs of extra policing on match days and the congestion charge introduced by Ken Livingstone, Mayor of London. In his speech at a CBI/Green Alliance conference in October 2000, the Prime Ministeracknowledged that Britain’s Kyoto target of a 121/2% cut in greenhouse gases was not
enough to deal with climate change and announced a new £50 million renewable energy subsidy for setting up offshore wind farms. Such devices have the effect of meeting desired aims by lifting or shifting a financial burden.