Shadow Chancellor Rachel Reeves said the party’s plans would be funded through an extension of the windfall tax on oil and gas producers, bringing in £2.2 billion a year, along with £2.6 billion per year in additional borrowing.
Labour hope the stripped back spending plan will blunt Conservative attacks over its economic policy. Prime Minister Rishi Sunak, speaking ahead of Starmer’s announcement, said: “I think it demonstrates exactly what I’ve been saying — that he U-turns on major things, [that] he can’t say what he would do differently because he doesn’t have a plan.”
Labour’s new spending plan includes an £8.3 billion capitalization for its planned state-run power company, GB Energy.
The party’s planned National Wealth Fund, which will invest in electric car production, ports, clean steel, hydrogen and carbon capture, will receive £7.3 billion, £2.5 billion of which will go to green steel.
Steel had previously been allocated £3 billion, but Starmer said that the new figure reflected the fact that the Conservative government had now included a £500 million investment in their own spending plans.
The plans are backed by Shadow Energy and Climate Secretary Ed Miliband, the main advocate for the party’s green agenda.
In a statement, Miliband said Labour would still be fighting the forthcoming election with a“world-leading agenda” on climate.
All the party’s pre-announced green policies would still be in its manifesto, Miliband said. Albeit now with less money attached.