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Rishi Sunak has confirmed he will be easing a series of green policies under a “new approach” designed to protect “hard-pressed British families” from “unacceptable costs”.

Delivering a speech from Downing Street, he said he is still committed to reaching net zero by 2050, but the transition can be done in a “fairer and better way”.

Announcing a raft of U-turns, the prime minister confirmed he will delay a ban on the sale of new diesel and petrol cars by five years and a weakening of targets to phase out gas boilers.

He also said a “worrying set of proposals” that had emerged during debates on net zero would be scrapped, including:

  • For government to interfere in how many passengers you can have in your car
  • To force you to have seven different bins in your home
  • To make you change your diet and harm British farmers by taxing meat
  • To create new taxes to discourage flying or going on holiday

“Our destiny can be of our own choosing,” Mr Sunak said – while calling for politicians to be “honest” about the costs of green policies on families.

Politics live: Rishi Sunak gives speech from Downing Street

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‘No rights to impose costs on people’

The measures have faced criticism from across the political spectrum as well as from businesses, environmental groups and even former US vice president Al Gore.

More on Net Zero

Labour accused the prime minister of “dancing to the tune” of net zero-sceptic Tories and said the plans would actually add more costs to households while damaging investor confidence.

Explaining the government’s decision to delay the ban on the sale of new petrol and diesel cars – currently due in 2030 – by five years, Mr Sunak said this would give businesses “more time to prepare”.

He also said people would still be allowed to buy secondhand diesel and petrol cars after that date and this would align the UK’s approach with countries across Europe, Canada and many US states.

In weakening the plan to phase out gas boilers from 2035, Mr Sunak said households would “never” be forced to “rip-out their existing boiler and replace it with a heat pump”.

This will only be required when people are due to change their boiler anyway and there will be an exception for households for whom that will be the hardest.

Mr Sunak also announced an increase to the boiler upgrade scheme, saying rather than banning boilers “before people can afford the alternative” the government is going to “support them to make the switch” to heat pumps.

He said: “The boiler upgrade scheme which gives people cash grants to upgrade their boiler will be increased by 50% to seven and a half thousand pounds.

“There are no strings attached. The money will never need to be repaid.”

Landlord efficiency targets scrapped

Mr Sunak has also scrapped plans to force landlords to upgrade the energy efficiency of their properties, saying some property owners would have been forced to “make expensive upgrades” within two years and that would inevitably impact renters.

“You could be looking at a bill of £8,000, and even if you’re only renting, you’re more than likely to see some of that passed on in higher rents,” he said.

“That’s just wrong, so those plans will be scrapped.”

Despite the “new approach”, the prime minister insisted the UK would meet its international obligations on climate change – such as those made under the Paris Climate Accords.

He went on to defend the UK’s record, arguing the country is “so far ahead” of other countries in the world when it comes to cutting greenhouse gas emissions.

PM wants to portray himself as a leader prepared to take unpopular decisions his predecessors weren’t


Amanda Akass is a politics and business correspondent

Amanda Akass

Political correspondent

@amandaakass

For all the rhetoric about democracy and real political change – today’s speech was fundamentally about the Prime Minister giving into the concerns of many in his party about the costs of the green policies set out by Boris Johnson’s government.

Labour see these announcements as projecting fundamental political weakness: 20 points behind in the polls and struggling to meet the majority of his five pledges, Rishi Sunak urgently needs to find a way to connect with voters struggling during the cost of living crisis. He’s keen to win over the right wing Tory backbenchers concerned about the electoral danger of expensive environmental policies like the ULEZ expansion which was widely seen to have cost Labour the Uxbridge by election.

It’s an impression underlined by the hurried way the announcement was made – less than 24 hours after these controversial change in tack was leaked to the media, prompting a huge backlash from business and many in his own party. Making such a key speech in the Downing Street media briefing room – rather than to Parliament, also looks chaotic.

It’s sent the Speaker into a fury, earning a humiliating rebuke. “Ministers are answerable to MPs – we do not have a presidential system here,” Sir Lindsey Hoyle thundered. For a man like Mr Sunak, who prides himself on being a sensible pragmatist – the complete opposite to the cavalier Boris Johnson – it’s surely a criticism that will sting, though it’s hardly unexpected.

The irony is that Rishi Sunak opened his speech by pledging to put the long term interests of the country before the short term political needs of the moment. Climate campaigners, for whom nothing could be more urgent, will surely scoff at this.

But in the framing of his speech – as the first of a series of long term policy decisions in a ‘new kind of politics’ – the Prime Minister and his team are keen to burnish his reputation as a pragmatic reformer, prepared to take the kind of unpopular decisions his predecessors weren’t. Certainly many in his party have been calling for a change in approach, a new bolder strategy to set out a greater distance with Labour – and it seems he has been listening.

The PM’s key arguments – that government shouldn’t impose unnecessary or heavy handed costs on hard working people, and relying on the market to drive change – are a return to classic Conservatism.

But his core argument that the need for action is less urgent than we have previously been led to believe, because of the UK’s success in meeting existing climate targets – is not one which will sit easily with green minded MPs.

And while he spent a key part of the speech concentrating on the importance of green technological innovation, and celebrating the power of the market in delivering progress – that will surely stick in the throat of companies who’ve spent billions getting ready to meet targets which have now been delayed. Many in his own party are concerned about the reputational damage to the UK as a centre of business investment.

He’s well aware that today’s message will be deeply unpopular with some – but promised to ‘meet any resistance’. Many Tory MPs will welcome that more bullish approach; but his promise to deliver ‘pragmatism and not ideology’ is pure Sunak.

The question now is in the hands of voters – do they buy into this argument that the country can reach Net Zero by 2050 without many of the policies designed to get there? Or in the midst of the cost of living crisis – will they be delighted to avoid the cost of paying for them?

‘Act of weakness’

Among the critics, Ed Miliband, Labour’s Shadow Energy Security and Net Zero Secretary, said: “Today is an act of weakness from a desperate, directionless prime minister, dancing to the tune of a small minority of his party. Liz Truss crashed the economy and Rishi Sunak is trashing our economic future.

“Having delivered the worst cost of living crisis in generations, the prime minister today loads more costs onto the British people.”

Lib Dem leader Ed Davey said: “This is a prime minister who simply doesn’t understand and cannot grasp for Britain the opportunities for jobs and our economy of driving forward with action on clean energy.”

There was also criticism from the car industry and energy industry.

Chis Norbury, the chief executive of the E.ON energy firm, said it was a “false argument” that green policies can only come at a cost, arguing they deliver affordable energy while boosting jobs.

He said companies wanting to invest in the UK need “long-term certainty” while communities now risk being condemned to “many more years of living in cold and draughty homes that are expensive to heat”.

Ford cars UK chairwoman Lisa Brankin said: “Our business needs three things from the UK Government: ambition, commitment and consistency. A relaxation of 2030 would undermine all three.”

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Rishi Sunak is asked if his net zero policy climbdowns are a result of him panicking about the next election.

Tory MPs split

The announcement comes after last night’s leak of the plans sparked a major Tory backlash and even a threat of a no confidence letter.

Mr Sunak was due to give the speech later this week but brought it forward following a hastily arranged cabinet meeting this morning.

Commons Speaker Sir Lindsay Hoyle reacted furiously to the announcement not being made to MPs, who are on recess for conferences, expressing his views “in the strongest terms” in a letter to Mr Sunak.

Tory MPs are split, with some seeing the row back on costly green policies as a vote winner and others fearing the impact it will have on business and the climate.

Senior figures who have backed the prime minister include his predecessor Liz Truss, who said: “I welcome the delay on banning the sale of new petrol and diesel cars as well as the delay on the ban on oil and gas boilers. This is particularly important for rural areas.”

Read more:
Braverman: ‘Bankrupting Britons won’t save planet’
Sunak’s messaging suggests net zero is negotiable
What could be scrapped from net zero pledges?

However Boris Johnson, who Ms Truss briefly took over from, said the row back would cause uncertainty for businesses, adding: “We cannot afford to falter now or in any way lose our ambition for this country.”

Mr Johnson’s ally and prominent Tory environmentalist Lord Zac Goldsmith went as far as to demand a general election over the “economically and ecologically illiterate decision”.

The UK’s commitment to reach net zero by 2050 was written into law in 2019.

Climate scientists say urgent cuts are needed to the world’s greenhouse gas emissions if we are to stop temperatures rising to a potentially catastrophic extent.

In the summer, scientists warned extreme heat events were rapidly on the rise due to climate change.

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Rachel Reeves acknowledges damage of ‘too many’ budget leaks

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Rachel Reeves acknowledges damage of 'too many' budget leaks

The Chancellor Rachel Reeves has acknowledged there were “too many leaks” in the run-up to last month’s budget.

The flow of budget content to news organisations was “very damaging”, Ms Reeves told MPs on the Treasury select committee on Wednesday.

“Leaks are unacceptable. The budget had too much speculation. There were too many leaks, and much of those leaks and speculation were inaccurate, very damaging”, she said.

Money blog: Nine-year-old set up Christmas tree business to pay for university

The cost of UK government borrowing briefly spiked after news reports that income taxes would not rise as first expected and Labour would not break its manifesto pledge.

An inquiry into the leaks from the Treasury to members of the media is to take place. But James Bowler, the Treasury’s top official, who was also giving evidence to MPs, would not say the results of it would be published.

Committee chair Dame Meg Hillier asked if the group of MPs could see the full inquiry.

More on Budget 2025

“I’d have to engage with the people in the inquiry about the views on that”, replied Mr Bowler, permanent secretary to the Treasury.

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OBR leak ‘a mistake of such gravity’

The entire contents of the budget ended up being released 40 minutes early via independent forecasters, the Office for Budget Responsibility (OBR).

A report into this error found the OBR had uploaded documents containing their calculations of budget numbers to a link on the watchdog’s website it had mistakenly believed was inaccessible to the public.

Tax rises ruled out

The chancellor ruled out future revenue-raising measures, including applying capital gains tax to primary residences and changing the state pension triple.

Committee member and former chair Dame Harriet Baldwin had noted that the chancellor’s previous statement to the MPs when she said she would not overhaul council tax and look at road pricing, turned out to be inaccurate.

During the budget, an electric vehicle charge per mile was introduced, as was an additional council tax for those with properties worth £2m or more.

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Strategy responds to MSCI letter, makes case for index inclusion

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Strategy responds to MSCI letter, makes case for index inclusion

Strategy, the largest Bitcoin treasury company, submitted feedback to index company MSCI on Wednesday about the proposed policy change that would exclude digital asset treasury companies holding 50% or more in crypto on their balance sheets from stock market index inclusion.

Digital asset treasury companies are operating companies that can actively adjust their businesses, according to the letter, which cited Strategy’s Bitcoin-backed credit instruments as an example.

The proposed policy change would bias the MSCI against crypto as an asset class, instead of the index company acting as a neutral arbiter, the letter said.

Bitcoin Regulation, Stocks, MicroStrategy
The first page of Strategy’s letter to the MSCI pushes back against the proposed eligibility criteria change. Source: Strategy

The MSCI does not exclude other types of businesses that invest in a single asset class, including real estate investment trusts (REITs), oil companies and media portfolios, according to Strategy. The letter said:

“Many financial institutions primarily hold certain types of assets and then package and sell derivatives backed by those assets, like residential mortgage-backed securities.”

The letter also said implementing the change “undermines” US President Donald Trump’s goal of making the United States the global leader in crypto. However, critics argue that including crypto treasury companies in global indexes poses several risks.