Solar panels

IFS response to Labour's announcement on plans for green investment

Published on 8 February 2024

An initial response to Labour's announcement that it will no longer seek to spend £28 billion per year on green investment

Ben Zaranko Senior Research Economist at the IFS said "Labour's proposed green investment programme has been effectively cut in half. Whereas previous promises implied something like £50 billion of additional investment over the next parliament, today's announcement brings that figure down to more like £24 billion, part-funded by an extension of the windfall tax on oil and gas producers.

The sums involved are now not terribly large in the context of the broader public finances. While we will have to wait for updated OBR forecasts and possible tax changes in the Budget on 6 March to be sure, this change should be enough to make Labour's spending plans consistent with their promise to have debt on track to fall as a share of national income. It should be remembered, though, that this rests on the assumption that a Labour government would implement the squeeze on public service budgets pencilled in by the current government."

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