Apart from the one criminal offence under the Climate Change Bill, which is the failure by an emitter to submit a greenhouse-gas (GHG) emissions plan, the Bill does not identify a single other violation and contains no other mechanisms to hold emitters accountable, says shareholder activism and responsible investment organisation Just Share.
Just Share's comments on the Bill have been submitted to the Parliamentary Portfolio Committee on Environment, Forestry and Fisheries and focus on the compliance and enforcement provisions in the Bill, which the organisation describes as “wholly inadequate to ensure that South Africa plays its part in limiting global GHG emissions to as close to 1.5 ˚C as possible”.
Once a GHG mitigation plan has been submitted to the Forestry, Fisheries and the Environment Minister, there are no mechanisms for the Minister or the department to hold emitters accountable for failure to comply with it, Just Share says.
"A company’s failure to comply with its carbon budget or its GHG mitigation plan should attract significant penalties if the Bill is to have any impact at all. Exceeding a carbon budget should also be clearly linked to the requirement to pay additional carbon tax on excess emissions. Violators should be liable to have their authorisations revoked and company directors should face personal liability.
"The provisions of the Bill apply to corporate entities and, as the Bill stands, there is little incentive to comply with it. By contrast, material benefits can accrue to a corporate offender, which contravenes its provisions. Unless the risks and costs of non-compliance exceed the benefits, the Bill will be toothless," the investor organisation argues.
The current Bill does not go far enough to ensure accountability for those who contribute significantly to and/or exacerbate the impacts of the climate crisis, it states.
"Just Share calls on the Parliamentary Portfolio Committee to introduce meaningful penalties and other compliance and enforcement provisions to ensure that the Bill is effective, and supports and strengthens our constitutional right to an environment not harmful to health and wellbeing," the organisation emphasises.
There is overwhelming evidence of the enormous scale of the climate crisis and the urgency to take effective steps to limit GHG emissions as quickly as possible. Despite this, and despite the evidence of the devastation already wrought by climate change, the global policy response to climate risk has been weak and inadequate.
In South Africa, corporate pushback and lobbying by fossil fuel interests have achieved the extension by three years of the first phase of the carbon tax. This first phase is weak, making provision for big emitters to receive between 60% and 95% tax allowances such as rebates or exemptions.
The second, more stringent phase of the carbon tax, which was supposed to kick in in 2023, will not do so until 2026. Given the effectiveness of lobbying against the tax, there is no guarantee that it will not be even further delayed, Just Share adds.
Finance Minister Enoch Godongwana in the 2022 Budget Speech referenced a higher carbon tax rate on emissions exceeding a company’s carbon budget.
"However, while this provision appeared in a previous version of the Bill, it is not contained in the current version. No public explanation has been provided for this omission," Just Share points out.
"It appears that mandatory carbon budgets in terms of the Bill will also be postponed until 2026. In other words, there will be more than three-and-a-half more years of emissions that will attract very little carbon tax," the organisation adds.