Shadow chancellor Rachel Reeves on Friday watered down Labour’s flagship £28 billion green investment plan.
In a major shift of policy, she announced it would now be “ramped up” over a number of years.
A Labour government, if elected, would get to the £28 billion annual sum by the second half of its first five years in power, she added.
Defending the scaling back of the timescale for the policy, Ms Reeves stressed that Labour’s fiscal rules were “non-negotiable” as they were the “rock of stability” on which the economy had to be built.
“I will never play fast and loose with the public finances,” she insisted, criticising Kwasi Kwarteng’s disastrous “mini-Budget”.
But Cabinet ministers tore into the policy change.
Net Zero Secretary Grant Shapps tweeted: “This embarrassing and screeching u-turn by @RachelReevesMP
confirms what we all knew...
“Labour are too weak to lead - their #JustStopOil plan would mean extinction for our economy, would decimate industries, force thousands out of work and drive up bills.”
Chancellor Jeremy Hunt took a different tack, stressing: “This superficial change from Rachel Reeves still adds around £100billion to our national debt - meaning higher mortgages for families and higher debt interest bills for taxpayers.”
Ms Reeves was also forced to deny there was a shadow Cabinet split over the policy shift with shadow net zero secretary Ed Miliband.
“Keir, Ed and me are all on the same page on this,” she maintained on BBC Radio 4’s Today programme.
However, Mr Miliband tweeted stressing that the £28 billion was a “commitment,” which is likely to be seen by some MPs as seeking to avoid any further erosion of Labour’s much-trumpeted green masterplan.
He messaged: “Some people don’t want Britain to borrow to invest in the green economy. They want us to back down.
“But Keir, Rachel and I will never let that happen. Britain needs this £28bn a year plan and that is what we are committed to.”
While Ms Reeves stressed that “economic stability, financial stability, always has to come first, ” the new plan left Sir Keir Starmer facing accusations of another U-turn, following changes of directions on university tuition fees and on nationalising key industries.
But she insisted: “We will get to the £28 billion, it will be in the second half of the first Parliament.”
Labour’s Green Prosperity Plan would have been funded from borrowing, to spend on projects like offshore wind farms and developing batteries for electric cars, but there were claims it had been spooked by the possible response from the markets.
A traditional accusation against Labour is that it is not fiscally responsible and Conservative Party chairman Greg Hands continues to try to make play of the note left in 2010 by outgoing Chief Secretary to the Treasury Liam Byrne that “I’m afraid there is no money”.
However, the Tories reputation for economic competence is also under scrutiny after Liz Truss’ brief premiership and the turmoil sparked in the markets, borrowing rates, and for the Pound caused by Mr Kwarteng’s September “mini-Budget”.
The Government is also facing criticism that inflation in Britain is remaining higher than in many other wealthy nations and that the UK economy is forecast to lag behind rivals, though Germany and the wider eurozone have already gone into recession.
The spotlight, though, is increasingly on Labour as polls suggest Sir Keir will form the next government, even if his party fails to get an overall Commons majority.
