Labour ditches £28bn green investment pledgeon February 7, 2024 at 10:15 pm

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A U-turn on the policy is set to be announced on Thursday, following confusion over the party’s position.

Sir Keir StarmerImage source, PA Media

Labour is ditching its policy of spending £28bn a year on its green investment plan in a major U-turn, sources have told the BBC.

An official announcement will be made on Thursday.

The sources insist the party’s Green Prosperity Plan, which includes creating a publicly-owned green power firm, is not being dropped altogether.

But Labour will no longer commit to investing £28bn a year in green energy projects if it wins power.

Labour’s position on the policy in recent weeks has been increasingly muddled, with some senior figures repeatedly refusing to use the £28bn figure when pressed in interviews, while others, including party leader Sir Keir Starmer, continued to do so.

It is expected Labour will argue that they have to focus on being seen as responsible stewards of the economy, rather than committing to a spending pledge that opponents regard as reckless.

The plan to spend £28bn a year on green energy projects, like offshore wind farms and developing electric vehicles, was first announced by shadow chancellor Rachel Reeves in September 2021.

That pledge was later watered down, with the £28bn target adjusted so that a Labour government would meet it about halfway through its first term rather than in its first year.

In recent weeks the prime minister has repeatedly attacked Sir Keir over the policy, suggesting it will lead to higher taxes.

Privately Labour figures acknowledge a long-standing “brand weakness”, as one source put it, when it comes to economic credibility.

So the decision has been taken to focus on attempting to reassure voters they can be trusted with the economy, rather than keeping the £28bn promise.

It comes on the day the Conservatives claimed, via Treasury analysis, that part of the plan, to insulate homes, would cost double what Labour had claimed it would.

Sir Keir had set a deadline of Thursday to finalise his party’s draft general election manifesto.

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