Labour Party Conference: Party pledges £28bn annually for climate action if elected
Shadow Chancellor Rachel Reeves used her platform at the Labour Party Conference to outline the Party's plans for £28bn of annual funding to tackle the climate crisis if elected.
In a keynote speech delivered at the conference in Brighton today (27 September), Reeves said she is striving to become the UK’s “first green Chancellor”. She argued that the current Conservative government is not properly factoring the need to transition to net-zero by 2050, to improve climate adaptation or to meet its levelling up commitments into its financial approach.
“Value for money means knowing when and where not to spend,” Reeves told the conference hall. “But it also means knowing when and where to invest – to prevent far greater costs further down the line.
“There is no better example of this than in the case of climate breakdown. As Chancellor, I will not shirk our responsibility to future generations and to workers and businesses in Britain.
“I will be a responsible chancellor. I will be Britain’s first green Chancellor.
"No dither, no delay. Labour will meet the challenge head-on and seize the opportunities of the green transition."
Reeves stated that the £28bn is around four times the amount that the Government is currently allocating to tackle the climate crisis annually. According to data from the Office for National Statistics (ONS), the UK Government spent £14.5bn on environmental protection during 2018 – the last full year for which data is available. However, this figure takes in activities such as waste management and noise and vibration management.
While Labour has not yet provided full details of how the £28bn would be split, Reeves spoke of the need for increase investment in sectors including electric vehicle (EV) battery manufacturing, active travel, offshore wind, green hydrogen, flood defences, nature conservation and restoration and building energy efficiency.
To this latter point, the Heat and Buildings Strategy is expected to be published shortly, following delays which have been attributed to disagreement within the Conservative Party on how measures to replace domestic gas heating with lower-carbon alternatives will be funded.
Moreover, Reeves’ speech comes just weeks before Chancellor Rishi Sunak is due to deliver this year’s Spending Review.
Greenpeace UK’s head of politics Rebecca Newsom said the £28bn commitment is "the scale of funding we so desperately need to both tackle the climate crisis and bring about the millions of new jobs for workers in a new green economy, creating new opportunities for those who work in declining industries”.
Newsom added: "Reeves has laid down the gauntlet, the question is whether Sunak can respond in kind."
Green Alliance’s head of green renewal Sam Alvis agreed, adding: “This is a big increase in ambition [from the Labour Party] that would go a long way in getting to net-zero carbon emissions and restoring nature.
“If we want to stimulate private investment and create new green jobs, we need clear direction from government. This puts pressure Sunak to follow suit with a similar programme.”
Sustainable Capital PLC's director Kevin Haynes said: “Any political party committing to making the economy greener is welcomed, but we cannot combat the climate crisis through government spending alone. If we are to overcome this challenge, private finance must be deployed at scale.
With governments and the private sector working together, we can invest in new technology and support existing industries with their transition to greener practices. No more so in areas like mining, which we will rely on supply the raw materials need for things like electric cars. To accelerate this, governments must create the conditions to allow private finance to flow, be it through reporting, cheaper credit or loan guarantees”.
Also detailed in Reeves speech were plans to phase out business rates in England. Rates are currently based on the value of the properties occupied by businesses.so, if businesses carry out upgrades to decarbonise, such as boosting energy efficiency or fitting renewable generation arrays onsite, they will face higher rates.
Outlining plans for the Party’s proposed alternative, Reeves said the new system would “incentivise investment, feature more frequent revaluations, and instant reductions in bills where property values fall, reward businesses that move into empty premises, encourage, not penalise, green improvements to businesses, and no public services or local authorities will lose out from these changes.”
Green New Deal?
The Conference comes as Labour leader Kier Starmer faces mounting pressure to more explicitly clarify his stance on a range of social and economic issues, including LGBTQ+ rights, defence and energy policy.
On energy policy, more than 25 motions on the climate emergency were tabled using the model put together by the Labour for a Green New Deal group, which is calling for the UK’s largest energy firms to be nationalised.
The GMB union, however, is standing against nationalisation, stating that both “public and alternative forms of ownership will be necessary to tackle climate and environmental breakdown”.
“We support a green new deal but it can’t be based on running down industries and making tens of thousands redundant – that’s not how you take workers and their communities with you,” GMB general secretary Gary Smith said.
Delegates ultimately endorsed the former approach over the latter, backing a “socialist Green New Deal”.