Ed Miliband's £400m rainforest fund shelved over 'optics concerns' while UK embroiled in bitter row over defence

A £400million commitment by Ed Miliband to help support the rainforest has been shelved after Rachel Reeves voiced "optics concerns".

The Energy Secretary was told not to announce Britain’s contribution to the Tropical Forests Forever Fund as the row over defence spending rolls on.

The fund aims to create a $125billion (£94.7billion) forest conservation fund using a mix of public funding and private money.

However, a source close to the Treasury told The Times Ms Reeves strongly objected to the timing of the announcement because of concerns about how it would have looked to the public.

While the pledge to the rainforest fund would have come from overseas expenditure and could not have been spent on defence, the announcement timing would have caused "optics issues".

A source close to Mr Miliband insisted the former Labour leader had not been blocked from making the announcement but had decided "not to pursue it now".

The Prime Minister is to press ahead with publishing the long-delayed Defence Investment Plan (Dip) ahead of the Nato leaders summit on July 7, after a dispute over funding earlier this month triggered the resignation of two ministers.

John Healey quit as defence secretary earlier this month because the Dip was only due to provide £13.5billion extra investment in defence, far short of the £28billion over four years which officials had argued for.

Mr Miliband has been touted as a potential successor to Ms Reeves in the increasingly likely event Makerfield MP and former Greater Manchester Mayor Andy Burnham becomes Prime Minister.

Key Labour figures have come out in support of the Energy Secretary getting the keys to No11, including former deputy leader Harriet Harman, who told Sky News Mr Miliband is "radical" but also "experienced" and "knows the Treasury inside and out".

Current deputy Labour leader Lucy Powell said she thought Mr Miliband would be good at running the Treasury but cautioned against “tittle-tattle” over who may get which job.

However, General Secretary of Unite Sharon Graham criticised Mr Miliband, saying the ex-Labour leader had "no thought for jobs, skills and national security".

She added: "Good investment in British industry is a no-brainer. Anyone who does not get that it matters where things are made and produced should not be Chancellor."

There have also been claims that broader cuts in the Department for Energy Security and Net Zero would be imposed in order to pay for defence spending.

However, a source close to Mr Miliband was quick to play this down, adding: "Any suggestion he has blocked or frustrated the defence investment plan process is absurd."

Meanwhile, Sir Keir today met with Nato secretary general Mark Rutte in Downing Street.

The Prime Minister emphasised the importance of the UK’s involvement in the group, which he called “the single most successful military alliance the world has ever known”.

In the meeting, the two discussed the Dip, as well as the war in Ukraine, the Strait of Hormuz, and the UK’s military assets in the region to support a future mission.

On the Dip, a Downing Street spokeswoman said after the meeting: "The Prime Minister set out how his plan would focus on readiness and autonomous capability, ensuring British forces would have the equipment they need to keep the UK and its Nato allies safe."

Sir Keir will press ahead with publishing the Dip during the transition period before his successor takes office following his resignation.

Mr Rutte later told Sky News he was "not at all" concerned at Mr Burnham’s lack of foreign policy experience because any incoming prime minister would have ambassadors, security advisers and military advisers to get them up to speed.

He added: "[Most Prime Ministers] will come in with there’s a lot of political clout, a lot political experience, but when it comes to the international stage, you have the best advisers in this country."

In a speech earlier today, Mr Burnham said Whitehall would also be required to change its culture to back British industry when spending taxpayers’ money.

“For too long, UK public procurement policy has been based on chasing cut-price deals around the world rather than helping our own British-based suppliers become more stable and competitive,” he said.

“No more. From here on, every pound raised from taxpayers will work harder for them, and that approach will apply fully to the defence investment plan.

“We will make sure that all eligible public contracts are subject to proper social value weighting, and we will do that to make sure British-based companies are in a better position to win those contracts.”