Labour’s flagship green prosperity plan, once the centrepiece of its economic agenda, has been effectively halved after the party abandoned its £28bn annual investment target. The climbdown, described by observers as 'the mother of all U-turns', follows months of internal tension between shadow chancellor Rachel Reeves and shadow net zero secretary Ed Miliband.
The pledge was first unveiled in 2021, with Reeves promising to invest in solar, wind and tidal energy to reduce dependence on Russia and build a sustainable economy. At the 2022 Labour conference, she declared she would be 'Britain’s first green chancellor', but notably omitted the £28bn figure from her speech. Insiders suggest fiscal hawks had already begun to question the commitment, fearing it could undermine Labour’s credibility on economic responsibility.
Last Thursday, Labour MPs were invited to an online briefing where Reeves and Miliband confirmed the £28bn target was officially dead. The entire plan has been scaled back, sparking fury among some backbenchers. One senior figure described the episode as 'demoralising and dispiriting', questioning if long-term climate investment would ever be possible without Tory attacks. MPs in constituencies with strong Liberal Democrat challenges voiced particular anger, having promoted the pledge on doorsteps for over two years.
Keir Starmer had reportedly been uneasy about dropping the policy until days before, fearing it would appear he stands for nothing. With the general election looming, the U-turn raises questions about what other Labour pledges might be abandoned. The party’s leadership insists the move is pragmatic, but many activists remain unsettled by the reversal.
