Britain’s main opposition Labor Party scaled back its flagship pledge to invest 28 billion pounds ($35 billion) a year in a green energy transition if it wins the next election, blaming the Conservative government for damaging economy since the proposal was first published in 2021. .
The plan now is to “step up” spending instead to £28bn in the first year of a Labor government, the party’s chancellor Rachel Reeves said in an interview with BBC Radio 4 on Friday. he is targeting the second half of his first five-year term, he said.
The shift in Labour’s plan is likely to draw criticism from party members who are calling for a bold vision for government focused on tackling climate change, but it also reflects an internal tussle over how best to persuade voters that the economy of workers can be trusted, which is considered essential. to win the next general election scheduled for 2024.
Reeves made it clear that the UK economy is in a different state to when poll-leading Labor first set out its green strategy, citing rising interest rates interest during Liz Truss’s short prime ministership as evidence that the state of public finances is forcing the party’s hand.
“I will never play fast and loose with the public finances and put people’s mortgages and pensions at risk like the Tories have done,” Reeves said. “But I’m also determined to grow the economy.”
According to an analysis by Dan Hanson at Bloomberg Economics, rising interest rates and gilt yields have blown a £9 billion hole in the UK government’s finances, effectively wiping out the space before the primary fiscal rule from both parties to get the national debt down as a share of GDP within five years.
