Private investment is key to protecting jobs during the transition to a greener economy, a Cabinet Minister has said.

Decarbonising the economy must be undertaken, said Secretary of State for Wales Jo Stevens, but it should be seen as an opportunity to help rather than damage the economy.

If handled correctly, she said, it will boost the economy, create jobs in parts of the country where they are most needed, and provide the country with energy security, while helping tackle climate change.

“We absolutely have to do it and one of the primary reasons we will need to do it is because we need cleaner manufacturing. We want to be able to build renewable energy. It will create new jobs, good, high skilled, well paid jobs,” she said.

“And it will also give the United Kingdom energy independence and security so that we don’t end up in that situation where we did previously, when Putin invaded Ukraine.”

Ms Stevens spoke to i in Port Talbot as she visited South Wales to announce the release of £13.5m to support businesses and workers affected by Tata Steel’s decision to close its furnaces and transition to electric steelmaking.

For this specific case, the Government has set aside a total of £500m to support the transition including money to help people losing jobs to find new employment.

This level of financial support is not expected to be provided to other industries aiming to decarbonise, but Ms Stevens said ministers hope to mobilise private sector investment to offer job protections elsewhere.

The minister’s emphasis on private-public investment in the transition to green jobs is reflective of a wider pattern of the new Labour government.

Prime Minister Sir Keir Starmer – and his Cabinet ministers – spent months wooing businesses in the lead-up to the election in the knowledge that his plans for green energy, housebuilding and a boost to infrastructure would not be possible without considerable private investment.

Under the Government’s plans for a new “national wealth fund” and the recently-launched Great British Energy, private investment will be courted to fund the introduction of new green industries.

This will combine the promise to decarbonise industry with the introduction of new jobs.

“We have got the National Wealth Fund and we are looking to crowd in private investment. For every one pound of government money that is invested, we will draw in three pounds from the private sector, and that will create jobs right across the United Kingdom,” Ms Stevens said.

She said the Government would ensure new jobs under the green transition will be located in the areas where old industry is dying, to prevent parts of the country being hollowed out and facing mass unemployment in the race to net zero.

“Offshore wind will be targeted in particular areas and communities that are in coastal areas, for example,” she said.

“But there are other areas where things like advanced manufacturing or nuclear or compound semiconductors – lots of different sectors of the economy where we know that we have real potential and ambition and skills and people – where we want to make a really successful future.

“And that is right across the UK. We are very clear that we want to see that economic growth and the jobs that that will bring in every part of the United Kingdom.”

The package of support for Port Talbot is a specific case, she said, but sits as part of a bigger industrial strategy planned by the new government.

In South Wales, Tata jobs will be replaced by electric steel production and the introduction of floating offshore wind.

“We are very clear that we want to invest in infrastructure. We will need more steel, not less, in order to deliver on the infrastructure that we need,” she said.

The money announced yesterday is the first tranche of funding and will made available to supply chain businesses and workers affected by the transition, helping them to find new jobs, access training and gain qualifications.

While pushing the idea of private-public investment, the reality is that if the Labour government wants to keep to its fiscal rules, without significantly increasing taxes, it does not have the spending power alone to enact the policies it has promised.

The emphasis on collaboration with the private sector has, however, been met with hesitation in some industries, not least in healthcare where Secretary of State for Health and Social Care Wes Streeting has faced criticism for promising to use private companies to improve NHS services.

In the NHS, as with green energy, ministers seem to be opting for a two-pronged approach of leaning on the private sector whilst also prioritising improving working conditions.

But critics have argued that an overreliance of private the private sector in crucial infrastructure – such as healthcare or energy – runs the risk of leaving the government relying on the whims of big business.

Additional reporting by Press Association.