We have to invest in people and places as old industries wane
As Britain awaits Andy Burnham's choice of chancellor, a chorus of senior economists — led by Nicholas Stern, architect of the landmark Stern Review — has coalesced around Ed Miliband, arguing that the moment demands not caution but purposeful boldness. Stern sees in Miliband a rare combination: institutional fluency in economic machinery, years of climate diplomacy, and the conviction that green investment is not a burden on growth but its very engine. The debate is, at its heart, a question older than any single appointment — whether a nation can summon the imagination to treat its future as an investment rather than a cost.
- With Andy Burnham's prime ministerial ascent imminent, the Treasury's £1.4 trillion budget hangs without a named steward, and the clock is pressing.
- Three candidates — Miliband, Wes Streeting, and Shabana Mahmood — are circling the role, but Stern's high-profile endorsement has sharpened the contest around Miliband.
- Critics quietly question whether a climate-focused energy secretary carries the orthodox economic credibility the Treasury demands in turbulent times.
- Stern and allied economists are reframing the argument entirely: the UK must raise infrastructure spending by two to three percentage points of GDP, and Miliband is the figure most likely to make that case and be believed.
- The trajectory points toward a chancellorship that would test whether Britain can position net-zero transition and economic recovery as a single, unified national project rather than rival ambitions.
Nicholas Stern — former Treasury second permanent secretary and ex-World Bank chief economist — has entered the chancellor debate with an unambiguous endorsement of Ed Miliband. With Andy Burnham yet to name who would oversee the Treasury if he becomes prime minister later this month, Stern argues that Miliband possesses both the strategic clarity and the institutional knowledge the moment requires.
Stern is careful about the word boldness. He distinguishes it sharply from recklessness, insisting the UK needs a chancellor willing to explain why increasing infrastructure investment by two or three percentage points of national income — directed at clean energy, modern cities, and transport — is not extravagance but necessity. Private capital and human capital, he contends, will only move when the conditions are right.
The two men share a history. When Stern joined the Treasury in 2003, Miliband was already chairing the council of economic advisers. Stern watched him navigate economic policy with purpose, and later observed him on the world stage at climate conferences where Britain's credibility carried weight far beyond its 0.8 percent share of global emissions. That credibility, Stern warns, erodes whenever the UK wavers.
Other voices have joined the call. UCL professor Josh Ryan-Collins argues the real failure has been the Treasury's reluctance to mobilise resources for workers and regions caught in the energy transition. With Miliband as chancellor, green investment could be recast not as a burden but as the foundation for well-paid jobs in places long left behind. The underlying argument is simple and ambitious: climate action and economic recovery are not competing priorities — they are, understood clearly, the same one.
Nicholas Stern, who spent years shaping economic policy at the Treasury under Gordon Brown and later served as chief economist at the World Bank, has stepped into the chancellor debate with a clear endorsement: Ed Miliband should get the job. The energy secretary, Stern argues, possesses both the strategic depth and the boldness required to steer the UK economy toward genuine growth—the kind that demands substantial new investment in infrastructure, clean energy, and the technologies that will define the coming decades.
Andy Burnham has not yet announced who would manage the Treasury's £1.4 trillion annual budget if he becomes prime minister later this month. Three names have circulated: Miliband, the former health secretary Wes Streeting, and the home secretary Shabana Mahmood, each positioned to succeed Rachel Reeves. Stern's intervention adds weight to Miliband's candidacy at a moment when the decision remains open.
What Stern values in Miliband is not recklessness dressed up as vision. He is careful to distinguish between the kind of boldness that means foolish—the sort that British television comedy once mocked—and the boldness that comes from having a clear direction and the willingness to explain why it matters. The UK needs to increase spending on infrastructure by two or three percentage points of national income, Stern contends. That money should flow toward clean energy systems, modern cities, and transport networks. The goal is not spending for its own sake but creating the conditions where private capital can move and human capital can develop.
Stern's support for Miliband's decision to halt new North Sea oil and gas drilling licenses reflects this philosophy. Propping up the oil industry, he argues, would be a distraction from the real work ahead. Aberdeen and other communities built on fossil fuels deserve massive investment in new technologies, but that transition cannot happen if the old industries keep drawing resources and political attention. The UK's credibility on climate matters extends beyond its 0.8 percent share of global emissions. When Britain wavers on climate commitments, it undermines arguments the country makes about the technologies and policies the world needs to adopt.
Stern and Miliband have history. When Stern arrived at the Treasury in 2003 as second permanent secretary and head of the government economic service, Miliband was a younger chair of the council of economic advisers. They worked together, shared interests, and Stern observed firsthand that Miliband understood the machinery of economic policy and moved with purpose. That institutional knowledge, combined with Miliband's years attending climate conferences where the UK positioned itself as a leader, would make him a figure of weight on the world stage.
Other economists have joined Stern's chorus. Lucy Powell, Labour's deputy leader, said last month that Miliband would make a good chancellor. Josh Ryan-Collins, a professor at University College London's Institute for Innovation and Public Purpose, pushes back against the notion that ambitious climate policy is economically foolish. The real problem, he argues, is that the Treasury has lacked the will to mobilize resources for workers and regions affected by the transition. With Miliband as chancellor, green investment could be framed not as a cost but as the foundation for long-term stability and the creation of well-paid jobs in parts of the country that have been left behind. The case for his appointment rests on the belief that economic recovery and climate action are not competing priorities but the same priority, understood clearly.
Citações Notáveis
I think of him as competent and strategic. I would also say bold...we have to have a clear direction showing where investments need to occur.— Nicholas Stern
Miliband as chancellor would make the case for green investment as the only way to stabilise the UK economy in the long term and create decent, well-paid jobs.— Josh Ryan-Collins, UCL economist
A Conversa do Hearth Outra perspectiva sobre a história
Why does Stern think Miliband specifically has what it takes to be chancellor?
Stern sees in him a combination of things that rarely come together—deep knowledge of how the Treasury actually works, a clear vision for where investment needs to flow, and the ability to explain why that vision matters. They worked together years ago, and Stern watched Miliband operate inside the system.
But couldn't any competent economist do that?
Not quite. Stern is saying Miliband has something else: he understands the climate transition and the industrial strategy required to manage it. He's spent years at international climate conferences. He knows the stakes aren't just domestic.
What's the actual disagreement here? Is someone arguing against him?
The disagreement is about whether ambitious climate policy costs too much. Some people see net-zero commitments as economic drag. Stern and others are saying that's backwards—the real cost is not investing, and the real opportunity is in green infrastructure.
So this is really about whether you can spend your way to growth?
It's about whether you can spend strategically to growth. Stern isn't arguing for spending on anything. He's arguing for spending on energy, cities, transport, and the technologies that will matter in fifty years. The question is whether the chancellor believes that and can convince others.
Why does it matter that Miliband has international credibility on climate?
Because the UK's influence on global climate policy depends partly on whether other countries believe Britain is serious. If the chancellor is someone who understands that and has relationships built on it, the UK's voice carries more weight in negotiations and in shaping what the world does next.