51. The Government is inching towards a coherent strategy aimed at ensuring that the industrial and commercial sectors play their full part in the achievement of the UK's Kyoto target for reductions in greenhouse gas emissions. That strategy would seem to involve a range of instruments being used, including taxation, regulation, negotiated agreements, and emissions trading, with a range of concessions for industries which use energy intensively and already seek to use energy efficiently and for particular types of fuels. We do not think that the Climate Change Levy, as presently designed, sits easily with that strategy. It treats all fuel types equally, regardless of their carbon content. A crude method of recycling revenues has been chosen, which essentially effects a transfer of resources from manufacturing industry to the service and public sectors. It places undue reliance on untested, unproven energy efficiency agreements between Government and industry. A more subtle approach is required from Government, for instance making use of more imaginative means of recycling the revenues raised by the Levy, including tax incentives for energy efficient investments, and drawing on the experiences of other countries which have established energy or carbon taxes. The Government is right to make a bold commitment to meeting its Kyoto target, but that target must not be met at the expense of British manufacturing industry. We anticipate that the Chancellor will be moving the debate on the Climate Change Levy forward when he releases his pre-Budget report in the autumn. We intend to keep the announcements he makes on the Levy under close scrutiny.