Rachel Reeves, the shadow chancellor will announce that a Labour government will make fighting global heating a priority for the Bank of England as it seeks to put environmental sustainability at the heart of its plans to grow the economy.
Reeves is expected to say in a speech in London on Tuesday evening that if Labour wins the general election she will reverse Jeremy Hunt’s decision last year to downgrade the emphasis on the climate crisis in Threadneedle Street’s main objectives.
Reeves’s announcement comes weeks after she was criticised by environmentalists for drastically scaling back Labour’s plans to invest £28bn a year in a Green Prosperity Fund – an important plank in its plan to cut greenhouse gas emissions and to achieve carbon net zero.
In her Mais lecture, the shadow chancellor will say Labour remains committed to greening the economy and will be able to achieve the twin goals of stability and higher growth only if it makes tackling the climate crisis a priority.
“There can be no durable plan for economic stability and no sustainable plan for economic growth, that is not also a serious plan for net zero,” she will say.
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The chancellor writes letters once a year to the Bank of England governor to set the remit for the financial policy committee (FPC) and the monetary policy committee.
In November, Jeremy Hunt downgraded the emphasis put on climate change in both remit letters and removed climate change from a list of four objectives for the FPC – the body that identifies systemic potential risks to the financial system.
Writing to the Bank’s governor, Andrew Bailey, the chancellor said the FPC’s four priorities for supporting the government’s financial policy objectives were growth and competitiveness, competition and innovation, home ownership and boosting productive finance.
Story was adapted from the Guardian.
