Keir Starmer slashes Labour's £28bn green spending pledge in major U-turn

8 February 2024, 17:10 | Updated: 8 February 2024, 18:25

Keir Starmer has confirmed Labour will ditch the green pledge.
Keir Starmer has confirmed Labour will ditch the green pledge. Picture: Alamy
Natasha Clark

By Natasha Clark

Sir Keir Starmer has made a U-turn on going green as he slashed his £28bn spending spree by three quarters.

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The under-fire Labour chief dropped the promise to splurge £28 billion every year on getting to clear energy by 2030 as he attempted to bat off Tory attacks on spending.

Sir Keir told reporters: “We will not reach the £28billion. The £28billion is stood down.”

After weeks of briefing that the controversial figure was set to be ditched, the Labour boss and Shadow Chancellor Rachel Reeves insisted that their Green Prosperity Plan would still go ahead.

It comes just 48 hours after Mr Sunak said that the extra cash was “desperately needed” and repeated the £28billion figure.

Whereas Labour’s shadow chancellor, Ms Reeves, was unable to confirm to the figure to LBC.

The party will now spend just £4.74 billion on going green. Half of that cash will come from extending the windfall tax to raise more money, and half from extra borrowing.

They promised they would still set up their own energy company, Great British Energy, and would still insulate millions of Brits’ homes – but this would take more time.

Read more: Ed Miliband ‘to support Labour ditching flagship £28bn green pledge’ following speculation he could resign

Read more: Labour to ditch £28bn green investment pledge blaming Tories for 'wrecking the economy'

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Starmer confirmed the plans on Thursday.
Starmer confirmed the plans on Thursday. Picture: Alamy

Speaking to LBC's Tonight with Andrew Marr about the U-turn, former Labour Prime Minister Gordon Brown said the Conservatives have to 'take some responsibility for leaving a mess to the next government'.

Asked if he was disappointed by the U-turn, Mr Brown said: "That's a matter for Keir Starmer. I haven't seen any official announcement actually.

"But if that's what he's decided, it is because he and Rachel have decided that they've got to abide by some fiscal discipline, given the state of the public finances.

"You have got to remember when we left power in 2010, debt was below 40% of national income.

"It's now 100% of our national income, I got criticised for allowing it to rise to 40%. Now it's 100% and the Conservatives have got to take some responsibility for leaving a mess for the incoming government, whoever it is."

It came as Labour finalised their manifesto offering this week with their promises to voters in the upcoming election.

Sir Keir insisted that Ed Miliband, the shadow net zero secretary, was completely on board – despite reports he had begged him not to row back on the promise.

The Labour boss laughed off suggestions that there were splits in his top team over the chaotic row-back, insisting: “We work together on all these plans. We are in lockstep, we are every closely aligned.”

Sir Keir told reporters this afternoon: “Things have changed since we made that announcement… when things change, we do have to change our plans too.”

He insisted that the idea he had flip-flopped was “ridiculous” and it was “the right way to do policy making” by changing his policy when the landscape changes.

He added: “I don’t want to have a row about the size of the cheque. I want a row about the outcomes.

“My mission was always about clean power by 2030…

“In the real world, almost all leaders adjust their decisions, it comes to common sense.”

Sunak said climate secretary Ed Miliband was supportive of the decision.
Sunak said climate secretary Ed Miliband was supportive of the decision. Picture: Alamy

Ms Reeves insisted she would still be the “first green Chancellor” despite significantly ripping up her huge spending plans which were first announced in 2021 at the party’s conference.

Today union chiefs, green groups and Labour MPs took aim at the massive row-back – saying it was “economically illiterate” and could cost them votes.

And the Tories jumped on the news too – saying Sir Keir was committing another flip flop and that he had no proper plan for the economy.

Mike Childs, head of policy at Friends of the Earth, said: “By seriously watering down its warm homes plan, the Labour Party has turned its back on the people who most urgently need these essential upgrades – the many millions of low-income households suffering from living in poorly insulated homes.

“The party's claims that it is doubling the current government’s spending commitment are misleading because not all the money is to be spent on insulation. Their new pledge pales in comparison to the investment required to tackle the worst homes and lift millions out of hardship.

“Just like broader essential green investment, a national programme of insulation would bring with it countless benefits – not just for our climate but also for jobs, our wallets and our economy.

"The Labour Party must show how it intends to meet our legally binding climate targets and international climate commitments with such limited investment, because right now it looks like they have torpedoed the chance of meeting these goals.

Caller will maintain his support for Labour despite U-turn

Responding, Prime Minister Rishi Sunak said: “Sir Keir Starmer has confirmed he doesn’t have a plan for Britain. The uncertainty about what a Labour government would do is a real risk to our country’s future. 

“Labour’s pledge – in their own words – has a £28 billion price tag and now they have admitted there is no plan to pay for it. This will mean higher taxes for working people to fill Labour’s black hole. 

“That’s why the choice this year is to stick with our plan that’s working, or go back to square one with Labour which would put our country’s future at risk.”

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