Blunkett rebuke for Labour after green about-turn

Starmer under fire from all corners after downgrading his party’s flagship policy and blaming the Tories ‘If we come up to power, we’re going to inherit an economy that’s very broken’

‘Sir Keir Starmer has confirmed he doesn’t have a plan for Britain’

have been worse” handled, Lord Blunkett has said, after Labour slashed the plan by more than 80 per cent.

The former home secretary hit out over “the optics, the PR, the timing” of the announcement as the policy was finally dropped by the party following months of chaos.

In his biggest change of tack yet, Sir Keir drastically downgraded his flagship green energy policy to just £4.7billion a year, from the previously promised £28billion, after admitting it was unaffordable.

What remains of the policy will be partially funded by expanding the windfall tax on oil and gas producers, which was introduced by Rishi Sunak when he was chancellor.

Sir Keir committed to the £28billion figure on Tuesday, with the subsequent change raising questions about his authority over Rachel Reeves, the shadow chancellor.

Lord Blunkett, who served in Sir Tony Blair’s cabinet, told the BBC: “The optics, the PR, the timing could not have been worse, and I hope lessons have been learnt not least in the run-up to the Budget where we, as a party, will have to decide what we’re tracking in terms of government changes and what we’re not.”

Sir Keir blamed the Tories and said Jeremy Hunt’s plan to “max out the credit card” for tax cuts meant there would be no money left for his climate plan.

Under the slimmed down blueprint, public funding for a home insulation drive has been reduced from £6billion a year to £1.3billion. Only five million houses will benefit from the scheme over the course of five years, compared with the original plan of 19 million across a decade.

Labour said it still intended to set up Great British Energy, a publicly owned body that will invest in green projects like wind farms, with a budget of £1.7billion a year.

It is also pressing ahead with creating a National Wealth Fund, which will put money into electric vehicle production and clean steel, with funding of £1.5billion a year. The green plan, which now amounts to £23.7billion over five years, will be on top of £50billion already committed by the Tories.

Ms Reeves said she will increase the total tax rate energy firms pay on their excess profits from 75 per cent to 78 per cent and will extend the levy throughout Labour’s first term in office.

She said doing so would raise £2.2billion a year towards bankrolling the party’s climate plan, with the remaining £2.5billion a year funded by borrowing.

Sir Keir said he would be making no more green spending commitments before the election and the £28 billion target was officially “stood down”. He said: “The reason for the change of the plan is obviously when we announced the £28 billion two and a half years or so ago interest rates were very, very low. Since Liz Truss crashed the economy and other damage has been done they are very, very high. If we come up to power, we’re going to inherit an economy that’s very broken, and we have to adapt according to the circumstances.”

Ms Reeves said she had “scaled back our ambition” on home insulation to prioritise green energy production, saying she would “like to go further and faster”. She said: “If we make commitments to policies that we wouldn’t be able to meet, we’d end up letting people down.”

Her sums were questioned by the Tories who said Labour was now only pledging a third of the money required to insulate five million homes.

Rishi Sunak said: “Sir Keir Starmer has confirmed he doesn’t have a plan for Britain. The uncertainty about what a Labour government would do is a real risk to our country’s future.”

Ed Miliband, the shadow climate secretary, rowed in behind the new policy after speculation that he could quit.