How Keir Starmer’s aid cuts threaten Britain’s climate mission

LONDON — Keir Starmer’s decision to underwrite a major new defense commitment by slashing overseas aid spending was supposed to signal the British prime minister’s seriousness about global security.

But along the way it has provoked a ministerial resignation, an internal party row — and left those in charge of the country’s ambitious international climate policies wondering if they, too, have been hobbled.

The cut, expected to take more than £6 billion a year from the aid budget from 2027, was announced by Prime Minister Keir Starmer at the end of last month.

A full week on, the government is unable to say what impact the cut would have on international climate finance — a key plank of U.K. green diplomacy through which money is invested in poorer countries to help them build cleaner energy systems or protect against the effects of climate change. 

“It’s too early to be able to respond,” Energy Minister Philip Hunt admitted to the House of Lords when asked on Monday. Hunt could only point peers to the government’s spending review, due in June, when more detail may be released. 

Energy Secretary Ed Miliband last year promised the U.K. would step up and fill “a vacuum of leadership” on global climate policy. But government officials repeatedly refused to say, when asked by POLITICO, whether Downing Street had consulted Miliband or his department before announcing the cuts. 

Miliband represents the U.K. at international climate summits and is jointly responsible with Foreign Secretary David Lammy for Britain’s effort to bring the rest of the world along on the road to net zero. His department had the fifth biggest foreign aid spend in the U.K. government, £440 million in 2023.

“This cut was made in Number 10,” said Nick Mabey, chief executive of the E3G climate think tank and a former adviser to multiple U.K. governments. “It was a top-level, top-down political decision.”

Parliament's cross-party International Development Committee criticized the impact of the cuts Wednesday morning, citing the hit to “global efforts to address poverty, inequality and climate change.” 

The Foreign Office did not respond to queries about the future of international climate finance.

Hunt reiterated Starmer’s promise that the U.K. would continue to play a leading role on climate change, as well as delivering humanitarian aid in Sudan, Ukraine and Gaza. In her resignation letter on Friday, former Development Minister Anneliese Dodds said: “It will be impossible to maintain these priorities, given the depth of the cut.”

MPs will discuss the impact of the cuts in parliament on Wednesday afternoon, in a debate called by two Labour backbenchers, Sarah Champion and Emily Thornberry.

‘A very damaging move’

Climate finance fosters efforts to cut emissions in developing countries and buys the U.K. influence to press its agenda at climate negotiations. But Dodds said in her letter that aid cuts will now weaken the U.K.’s position at those negotiations, while experts warned the cuts will force ministers to retrofit an international climate strategy to suit the prime minister’s new spending priorities.

“Though defense spending needed to be increased, this was probably the most diplomatic- and influence-expensive way of doing it,” said Mabey. “It was a very damaging move.”

The government has recommitted to its current target to deliver £11.6 billion in climate aid between 2021 and 2026, Hunt told the House of Lords. But it is unclear what happens after Starmer’s overseas aid cut comes into effect in 2027.

Labour entered government pledging to return Britain to a global leadership position on climate change. In November, Miliband announced a new target for reducing planet-destroying carbon emissions in the period up to 2035, required this year under the terms of the Paris Agreement. The same month, the U.K. was a key player at the COP29 climate summit in Baku, which concluded with a deal to triple the flow of climate finance to developing countries over the coming decade.

“We can't believe — given the scale of the cut — that the increase in climate finance we were hoping to see following Baku … will be taken forward,” said Mabey.

Alok Sharma, a former Tory minister who presided over the COP26 climate conference and now sits in the House of Lords, has asked the government repeatedly in the past week whether existing commitments would remain intact.

That includes the £11.6 billion target, set by the previous Conservative government. 

Sharma also asked Hunt about several multi-billion pound clean energy partnerships brokered between G7 countries and emerging economies such as South Africa, Vietnam and Indonesia. Neither Hunt, nor a departmental spokesperson when asked by POLITICO, would clarify the future of those projects.

Joining the club

“It is hard to see the cuts as anything but a retreat from the U.K’.s international responsibilities and an unacceptable balancing of the books on the backs of the world’s most marginalized people,” said Catherine Pettengell, the executive director of Climate Action Network UK, a green NGO.

They come on the back of enormous and sudden reductions in the U.S. aid program, ordered by President Donald Trump, and follow similar announcements in France, Germany, the Netherlands, Belgium, Sweden and Finland, where spending priorities have also shifted toward defense.

This will force the U.K. to undertake a long-overdue “radical reform” of how aid money is spent, Mabey argued. Ministers would “get much more value for money out of each pound” by sharing technical and financial expertise, he said. 

“All the developing countries we speak to, would really value that,” Mabey added. “They want to talk to the people who run our grid, not someone employed by our development finance [agency] who is a consultant.”