In 2016, soon after his enforced departure from politics, Ed Balls recalled: “In the period from 1996 to 2004, I don’t remember anything the Tories did having any effect on my life whatsoever.”
There are some inside government today – basking in a New Labour-sized majority – who view Kemi Badenoch with similarly magisterial indifference. “Nothing” was how one aide replied when I asked what they made of the Conservative leader’s speech on net zero this week. But Labour recognises that it needs to absorb the implications of a changing political climate.
From one perspective, Badenoch’s intervention – she declared that net zero by 2050 was impossible “without a serious drop in our living standards” or bankruptcy – looks like an opportunity for Keir Starmer. Public support for net zero is stronger than a sceptical media often implies. Sixty-one per cent of Britons back the 2050 target, according to a new poll by YouGov, with a mere 24 per cent siding with Badenoch. This includes 52 per cent of the Tories’ own voters (just 38 per cent are opposed). Labour is framing Badenoch as a “climate defeatist” opposed to a project that is “good for the economy”.
And yet in recent months the government’s commitment to net zero has been questioned. In defiance of private opposition from the Energy Secretary, Ed Miliband, Rachel Reeves has backed granting approval to both a third runway at Heathrow Airport and developing the Rosebank oil field in the North Sea, declaring that growth must always trump environmental concerns.
Starmer has already ventured into political territory once thought unthinkable: abolishing NHS England, reducing the foreign aid budget by 40 per cent and announcing the biggest welfare cuts since George Osborne occupied the Treasury. Will net zero, both supporters and opponents wonder, be the next shibboleth to be demolished? Will Miliband survive the anticipated cabinet reshuffle? Memories linger of Labour’s defeat to the Conservatives in the 2023 Uxbridge by-election – blamed by those now in No 10 on the ultra-low emission zone (Ulez) row – and the abandonment of the party’s £28bn green investment pledge.
And yet, some say, look at what has happened since. Miliband, contrary to occasional pre-election speculation, became Energy Secretary. Labour’s commitment to clean power by 2030 – through a dramatic expansion of renewables – has endured. The publicly owned GB Energy, which is popular with voters, has been launched. Miliband’s department secured a 22 per cent real-terms funding increase in Reeves’ Autumn Budget (to £10.3bn in 2025-26). Starmer has been to Cop and announced a toughened climate target: reducing UK emissions by 81 per cent by 2035. A fortnight ago – despite opposition from Unite and the GMB – ministers reaffirmed the ban on new North Sea oil and gas licences.
Tomorrow, I understand, the government will announce the installation of solar panels on hundreds of schools and hospitals (which sources say will include “patriotic” GB Energy logos and branding) with a promise to save them hundreds of millions on their energy bills. The last Labour administration was sometimes criticised for its reliance on fiscal transfers over more permanent institutions – look at how easily Gordon Brown’s tax credits were hacked away by Osborne. By creating social-democratic facts on the ground, Miliband is seeking to make his legacy harder to unpick.
It is a distinctive project – one that plenty speculate No 10 would like to end. Labour strategists are allergic to anything that resembles telling people how to live their lives or that directly impinges on their living standards (think Ulez or a “meat tax”). But their commitment to green power is stronger than most assume. “Clean energy is a key part of our agenda. We’ll need a lot more energy and more independence than before,” a Starmer adviser told me. “Getting bills down is important.”
Here is the challenge. Labour likes to talk about net zero as an uncomplicated positive: the UK will get off what Miliband calls “the roller coaster” of global fossil fuel markets and bills will fall as a consequence. Households won’t just be greener; they’ll be richer too.
But it isn’t only Badenoch who is sceptical whether the journey to net zero will be this smooth. During the general election, Labour vowed to reduce bills by £300 – a pledge recently reaffirmed by Starmer. Yet without radical government intervention, the energy sector warns, the high upfront cost of renewables will thwart this aim. Based on Labour’s current plans, lower bills are plausible within the “next decade” but not by the next election, warns Energy UK.
For a glimpse of the dangers that await Starmer, look to Australia. There, the Labor prime minister, Anthony Albanese, made an eerily similar pledge to reduce bills by $275. Now, as he struggles to avert election defeat, this is labelled a “con job” by his opponents. Far from falling, Australian energy costs are an average of $609 higher than Albanese promised (here, they are already £281 higher than when Labour entered office).
There is, of course, a precedent for state intervention in the energy sector. It was that supposed free-marketeer Liz Truss who introduced a £150bn scheme – freezing prices at an average of £2,500 – during her brief spell in No 10. Miliband’s allies insist that they have a plan to reduce bills – a task awarded to Miatta Fahnbulleh, the minister for energy consumers and the former chief executive of the New Economics Foundation. But should global and domestic factors inflate bills, will Reeves’ austere Treasury have the resources to intervene?
This is what gives net zero supporters cause for concern. Labour – to borrow the framing of the welfare debate – prefers to make an economic case for net zero than a moral one. Some liken it to the Blair and Brown governments’ approach to the EU – talking up the benefits of membership without ever making the fundamental argument for the project.
The British public, it bears noting, are more supportive of net zero than they almost ever were of EU membership. But in a volatile age, opinion can easily shift (since July 2023, support for the 2050 target has fallen by 18 points and opposition has risen by eight points). Should living standards decline under Labour, there will now be two parties – Reform and the Tories – blaming a common foe: net zero. Progressives, bearing the scars of the last decade, fear the climate consensus is more vulnerable than it appears.
Challenged by Reform’s Lee Anderson at this week’s Prime Minister’s Questions, Starmer conceded that “net zero is of course not easy”. Winning the argument may not be either.
This piece first appeared in the Morning Call newsletter; receive it every morning by subscribing on Substack here
[See also: What went wrong for Kemi Badenoch?]
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