Ed Miliband found himself at odds with Rachel Reeves over her approach to cutting green taxes on household energy bills, it has emerged.
The Energy Secretary got into several fiery exchanges with Treasury ministers before the Budget was announced, sources have told The Telegraph.
The disagreements centred on how the Chancellor planned to bring down energy costs by roughly £150 per household.
Mr Miliband wasn’t against lowering bills for families – he was on board with that goal – but what he really didn’t like was the Treasury’s proposed levy control framework, which would essentially put a cap on how much revenue his Net Zero department could generate from green taxes.
The crux of Miliband’s opposition was a Treasury plan to impose new controls on levies to keep consumer costs down.
Whitehall insiders say he worried about losing his grip on taxes that fund home upgrades and support green energy projects.
A source familiar with the negotiations described his approach in blunt terms: “His style is not particularly chill.”
Another Government source painted a fuller picture of the Energy Secretary’s stance.
Ed Miliband found himself at odds with Rachel Reeves over her approach to cutting green taxes on household energy bills, it has emerged
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“It’s not like he was saying he didn’t want to cut energy bills,” they said. “Ed’s a good politician, he understood the reasons why the Government had to do it.
“But he has a tough negotiating style and he doesn’t like to lose.”
The Treasury’s new framework takes its cues from a similar policy George Osborne introduced back in 2011, and officials are working to roll it out in the “medium term”.
Reeves also unveiled plans to scrap the Energy Company Obligation levy entirely – a scheme that made energy firms fund home improvements for lower-income households through charges on bills.
Ed Miliband’s negotiating style is ‘not particularly chill’, according to one source
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Treasury officials felt the scheme was “failing” because it was paying for fewer and fewer upgrades as costs climbed.
Mr Miliband had reservations about axing the levy completely, which will slash £1.7billion a year from upgrade scheme funding.
The Government is now preparing to launch the Warm Homes Plan instead, which will rely more heavily on general taxation rather than charges taken directly from bills.
The clashes reveal a notable rift between two of Sir Keir Starmer’s most trusted Cabinet allies over the best way to ease energy costs for households.
It comes amid reports that the Net Zero Minister’s new energy efficiency standards for private landlords could cost the Chancellor a bill of £7,500 in order to upgrade her four-bedroom London home.
It currently sits at a D rating on its Energy Performance Certificate (EPC), one band short of the C minimum that will be compulsory for all rented homes by 2030.
It also wasn’t the former Labour leader’s first run-in with the Treasury.
Earlier this year, reports surfaced that he “stormed out” of a meeting with Darren Jones, then chief secretary to the Treasury, when asked to identify spending cuts.
After weeks of back-and-forth, he was among the last ministers to strike a deal, eventually securing a 16 per cent funding boost for his department.
A source close to Miliband pushed back: “We don’t recognise this. Ed has been fully supportive of the Budget measures.”
