Making Miliband chancellor would be a ‘mistake’, Trump officials warn
Senior officials in president Trump’s administration have privately warned that appointing Ed Miliband as chancellor would be a “mistake”, as speculation over who will take over from Rachel Reeves grows.
US officials told their counterparts in Britain, as well as senior Labour figures, that they were concerned about Miliband’s opposition to new oil and gas drilling licences in the North Sea, according to reports in the Times.
During his time as energy secretary in Starmer’s cabinet, Miliband has triggered backlash from some industry and City figures over his efforts to push the UK towards net zero.
He has also stalled on giving the green light to new exploration projects from Shell and Equinor, refused to ease North Sea drilling licences, with US officials believing this is “ideologically driven”.
They went on to argue that tax revenues raised from lifting it could help to fund defence spending.
Trump has previously described the UK’s net zero policies as “stupid”, a sharp contrast to Miliband’s stance on renewable energy.
The North Sea divide
Andy Burnham, who is expected to enter No 10 later this month, said on Thursday that he had not yet made a decision on who he would appoint as chancellor, although Miliband is the frontrunner.
While Miliband has been a long-term ally of Burnham, there is a clear divide between the two on the North Sea.
Miliband has argued North Sea drilling creates little economic benefit and causes significant damage to the environment, but Burnham has said he is “open” to new drilling.
This is a stance heavily favoured by large numbers of Labour MPs and some unions, including GMB.
A government source told The Times: “The Trump administration has made clear that they have concerns about him becoming chancellor, particularly over North Sea oil and his environmental agenda.”
An official in the US confirmed that concerns had been raised.
“Bring back the oil”
In his opposition to Miliband’s stance, Trump has urged the UK to “bring back the oil” and “get rid of the windmills”.
He also described the North Sea as a “treasure chest” during a visit to Scotland last year and claimed high taxes “make no sense”.
Trump has also previously criticised Burnham, referring to him as the “mayor of a town”.
He said: “I think I see that he was, I guess, the mayor of a town. I hear he’s extremely liberal, extremely, so that means he probably won’t open up the North Sea.”
Burnham is expected to choose between Miliband and home secretary Shabana Mahmood for the role, but Burnham’s allies are divided on who should be leading the Treasury, with some believing Miliband would pose a “threat to the country”.
Miliband’s allies have argued he is the only candidate able to turn around the economy.
City figures have also weighed into the debate over who should be chancellor, arguing that markets would take a Miliband appointment “worse”.
Banks have also raised concerns over Miliband, arguing he would “be a disaster”.