Starmer defends Labour’s green U-turn

Labour business event Credit: PA Wire/PA Images

Sir Keir Starmer is defending Labour’s U-turn on its pledge to spend £28 billion a year on green projects amid criticism from environmental groups, unions and energy industry figures.

The Labour leader said the party has been left with no choice than to scale back the financial policy in the face of a “very broken” economy presided over by the Tories.

Sir Keir announced on Thursday the figure would be adjusted to £23.7 billion over the course of the next parliament if his party wins the next election.

He insisted the ambitions behind Labour’s flagship green prosperity plan remain the same and recommitted to his mission to achieve clean power by 2030.

Labour leader Sir Keir Starmer speaking at the launch of the Labour Party’s mission on cheaper green power in June 2023 Credit: Jane Barlow/PA

But the party’s plan to insulate homes is set to be one casualty of the climbdown, with five million expected to be completed in the first five years rather than the 19 million initially promised.

“There is nothing we have said we will do that we are now saying we won’t do,” Sir Keir said.

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

The spending pledge was first made in September 2021 and Labour has blamed Tory stewardship of the economy and higher interest rates since then for the reversal.

But the rowback sparked an immediate backlash from green campaigners, as well as warnings from trade union allies, figures in the energy industry and some within the party ranks.

Emma Pinchbeck, chief executive of trade association Energy UK, warned that “business needs to know that politicians won’t pull the rug from under them”.

The Unite union, a major Labour donor, said the party risks “outsourcing their policy-making to the Conservatives”.

The Tories had seized on the original pledge as a key attack line in the run-up to an election this year, claiming Labour would ultimately have to raise taxes to meet the “unfunded spending spree”.

Prime Minister Rishi Sunak said the “uncertainty about what a Labour government would do is a real risk to our country’s future” following months of confusion over the fate of the policy.

“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,” he said.

Labour MPs Clive Lewis and Barry Gardiner both voiced concerns about the impact the rowback would have on the party’s ability to act on its green ambitions.

The Confederation of British Industry (CBI) warned that Britain faces a “race against time” with global competitors offering significant financial incentives, but added that the UK’s pitch “must now be how it can outsmart, not outspend, its competitors”.