Shadow Chancellor Rachel Reeves has outlined Labour's new economic strategy, drawing inspiration from US President Joe Biden's approach to tackling inflation and creating jobs. During a speech in Washington DC, Ms Reeves introduced 'securonomics', a plan she says will rebuild Britain's 'industrial foundations' and insulate the country from global shocks.
The strategy proposes a bigger role for government in the free market economy and closer cooperation with like-minded international allies. Ms Reeves stated that 'globalisation as we know it is dead' and emphasised the need to reduce Britain's reliance on foreign workers and goods. She also praised Biden's Inflation Reduction Act, a $430bn package of subsidies and tax breaks, but stressed she does not want to make Britain 'a version of America, Australia, Germany or France'.
Labour's flagship policy includes a £28bn a year 'green prosperity plan' to create jobs in clean energy and establish a publicly-owned renewable energy company. Ms Reeves has promised to bind a future Labour government to strict borrowing limits, which some suggest may require scaling back the green plan. She conceded that 'money would be tight' but insisted manifesto policies are fully costed.
Ms Reeves also proposed a 'new special relationship' with the US focused on the clean energy economy, involving regular dialogue with the Biden administration and US trade unions. She met US Treasury Secretary Janet Yellen during her trip and has published a pamphlet titled 'A New Business Model for Britain' detailing the strategy.
The speech comes amid criticism from UK government ministers, with Energy Secretary Grant Shapps warning of a 'dangerous' slide into protectionism and Business Secretary Kemi Badenoch complaining the IRA could 'harm multiple economies'. The EU, Canada, and South Korea have also argued it breaches world trade rules.
