Embarrassment for Keir Starmer after ‘major doubts’ over £28bn green pledge
Keir Starmer is likely to face huge embarrassment as the Labour government might fail to meet its ambition to spend £28bn a year on green initiatives, it has been reported.
Labour announced the flagship policy at its annual conference in 2021. However, in June shadow chancellor Rachel Reeves watered the pledge down, saying the figure would not be reached until 2027.
Now, it is understood the figure will probably not be reached at all, the BBC reports.
A senior officer in the Labour leader’s office said that was because of the state of the public finances. They stressed that Labour’s fiscal rules were more important than any policy.
The Conservatives have previously warned of the alleged dangers of the policy – claiming extra borrowing could increase interest rates and mortgage costs.
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During the Labour party conference in Brighton two years ago, Ms Reeves announced her ambition to be the UK’s first “green” chancellor.
She unveiled Labour’s Green Prosperity Plan, explaining money would go on offshore wind farms, planting trees and developing batteries. She added it would be funded by borrowing.
But in June Ms Reeves said she took the decision to scale back the Green Prosperity Plan as a result of the poor state of the economy.
“No plan can be built that is not a rock of economic and fiscal responsibility,” Ms Reeves told BBC Radio 4’s Today programme at the time.
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She added. “I will never play fast and loose with the public finances.”
Another Labour source told the Telegraph: “The fiscal rule matters more, and that will dictate how much is in the green prosperity fund.”
Labour is determined to paint itself as the party of economic credibility – even if it means tempering one of the central planks of its programme for government.
Hannah Martin, co-director of campaign group Green New Deal Rising, said a Labour u-turn on the Green Prosperity Plan would be “a disaster”.
She said Labour “should be going much further” and commit to a range of measures including guaranteeing millions of green jobs, a wealth tax and a home insulation programme.
“Failing to commit even to the basics of investing in our planet and economy would be a huge betrayal – and our generation won’t let them forget it,” she said.
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