Labour Has Officially Shelved Its £28 Billion Green Investments Pledge

The Labour Party has officially shelved its £28 billion a year green investments pledge, after weeks of rumours and denials.

The pledge to spend £28 billion a year on making Britain a “clean energy superpower” formed the crux of Labour’s environmental policies. The move casts doubt on whether the party will be able make good on its promise to reduce household energy bills and deliver energy security through renewables if it wins the next general election.

Labour leader Keir Starmer told reporters last Thursday evening that the party would now spend a little over £4.7 billion a year, on top of the £10 billion the government has already committed to green schemes. This brings Labour’s total promised annual spending on green investments to just under £15 billion a year, around half of what it had previously promised.

The announcement comes after intense criticism from the Tory Party over the amount of borrowing that would be needed for Labour to keep to its pledge, which would increase government debt.

The cut to Labour’s spending promise has left environmentalist groups frustrated with the party. Rebecca Newsom, head of politics at Greenpeace UK released a statement before the cut was confirmed saying: “Dropping the green investment pledge would be weak political, economic and climate leadership from Starmer before he’s even got his feet under the table.”

Hardest hit by the cut was Labour’s home insulation scheme, dubbed the ‘Warm Homes Plan’. Spending to insulate 19 million homes across the UK was reduced from £6 billion a year to £1.3 billion a year over a decade.

Commenting on the cut, Jess Ralston, an analyst at the Energy and Climate Intelligence Unit (ECIU) said it would mean “more wasted energy, more imported gas and higher bills”.

Labour’s u-turn on insulation comes a week after the charity National Energy Action (NEA) published a report that found millions of homes in England would still be severely energy inefficient by 2030 because of lack of government support. The current government does have grants for insulation in place, but the NEA report stated that close to £14 billion in extra public funding would be needed to insulate homes across the UK.

Spending promises for other planned schemes, such as Labour’s “GB Energy” plan, a project to create a national renewable energy supplier, remained intact. Rachel Reeves, Labour’s shadow chancellor, defended the cut to insulation by saying:

“Something had to give if we were going to be within our fiscal rules and to achieve clean power by 2030. We have got to get on with the national wealth fund and GB Energy, and so we have scaled back our ambition on warm homes.”

Labour leaders broadly blamed what they perceive as the Tory government’s mismanagement of the economy for forcing them to cut back on borrowing, citing “very high” interest rates.

Prime Minister Rishi Sunak clapped back, telling BBC Radio Devon: “the signature economic policy that the Labour Party has is in tatters, and that’s what happens when you don’t have a plan.”

The Tory Party is facing its own struggles when it comes to environmental policy, with The Times reporting last Wednesday that the party was facing an “internal revolt” over plans to scrap the so-called ‘boiler tax’ scheme, due to come into effect this April.

What this shows is that environmental policies are probably going to be a hot button issue this election, as parties vye to be seen as Net Zero leaders.