Category Archives: Economic policy

Starmer’s growth plan ‘doomed’ without access to EU markets, warn economists

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Labour leader told if elected he will have to rejoin the customs union to meet party’s manifesto pledges, while 56% of voters say Brexit was bad for economy

A Labour government under Keir Starmer will fail to maximise the UK’s economic growth unless it takes the country back into the European Union’s single market and customs union, leading economists and diplomats have said.

The warnings come as an Opinium poll for the Observer finds that 56% of voters now believe Brexit has been bad for the UK economy as a whole, compared with just 12% who believe it has been economically beneficial.

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Expert economists back Labour’s plan to end economic stagnation in UK

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Nobel prize winners and former Bank of England officials believe Rachel Reeves and Keir Starmer can bring about ‘desperately needed’ change

Labour’s plans for ending Britain’s long-term economic stagnation have been backed by a group of leading economists, including three Nobel prize winners and a former Bank of England deputy governor.

In a boost to the shadow chancellor, Rachel Reeves, the 16 UK and internationally based economists said change was “desperately needed” after the policy mistakes and failures of the past 14 years since the Conservatives took power.

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Jeremy Hunt: Liz Truss economic plans were ‘good thing to aim for’

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Exclusive: Leaked recordings reveal chancellor ‘trying to achieve some of the same things’ as former prime minister

Jeremy Hunt said Liz Truss’s economic ambitions were a “good thing to aim for” and her disastrous mini-budget hadn’t left an impact on the economy, according to two leaked recordings obtained by the Guardian.

The chancellor was recorded at a meeting of students when he said he was “trying to basically achieve some of the same things” as the former prime minister, but that he was doing it “more gradually”.

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Investment in UK has trailed other G7 countries since mid-1990s, IPPR says

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Institute for Public Policy Research urges Labour and Conservatives to reverse planned cuts

Investment in the UK has trailed other G7 countries including the US and Germany since the mid-1990s, according to a report that urges Labour and the Conservatives to reverse planned cuts to investment or risk long-term damage to economic growth.

The Institute for Public Policy Research (IPPR) thinktank found the UK was bottom of the G7 league for investment in 24 out of the last 30 years, using figures from the Organisation for Economic Co-operation and Development (OECD).

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Labour’s green plans will create 650,000 jobs, says Rachel Reeves

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Party begins week of campaigning on economy under pressure to say if it will raise taxes to pay for £7.3bn plans

Labour will create more than 650,000 jobs with its green investment plans, Rachel Reeves has said, as the party kickstarts a week of campaigning on the economy.

The UK shadow chancellor has revealed new details about the £7.3bn green investment vehicle that Labour intends to create after the election, saying it will help create hundreds of thousands of new industrial jobs.

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Starmer promises ‘long-term strategy’ in business-friendly Labour manifesto

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Labour puts economic policy and wealth creation at heart of pitch to win over former Conservative voters

Keir Starmer will put economic growth and wealth creation at the heart of Labour’s offer to voters as he launches a business-friendly manifesto targeted at former Conservative voters.

The Labour leader will launch his election manifesto in Greater Manchester on Thursday, promising to emphasise economic stability in a deliberate contrast to the Conservatives’ more policy-heavy offering earlier this week.

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Green party launches election manifesto with ‘honest’ tax proposal

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Leaders outline ideas including wealth levy, rent controls, house-building, and water and energy firm nationalisation

The Greens have launched their election manifesto with an appeal to voters to help them into parliament as a challenge to what they termed the unambitious, “more of the same” policies of Labour.

Setting out their plans in Brighton and Hove, the location of one of the party’s key target seats, the co-leaders, Carla Denyer and Adrian Ramsay, said their proposals for higher taxes – mainly on wealthier people – were the only realistic way to improve public services and undertake vital environmental policies.

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Watchdog ends investigation into description of UK economy ‘going gangbusters’

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Exclusive: ONS official’s remarks, not intended as comment on overall state of the economy, were later used by Sunak

The UK’s statistics watchdog has closed an investigation into remarks made by an official about the economy “going gangbusters” that were cited by Rishi Sunak.

It was looking into the comments made by chief economist of the Office for National Statistics (ONS) last month amid concerns that politicians could misuse economic data in the run-up to the election.

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UK clothing sales to EU plummet as Brexit red tape deters exporters

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Small and medium-sized firms badly hit as huge drop in apparel sales helps fuel 18% slide in all-non food exports

UK exports of clothing and footwear to the EU have dived since Brexit, according to a new study that shows the extent to which complex regulations and red tape at the border have deterred firms from sending goods across the Channel.

Exports of clothing and footwear sold to EU countries have fallen from £7.4bn in 2019 to £2.7bn in 2023, helping fuel an 18% slump in sales of all non-food goods exports to countries covered by the EU single market, according to the consultancy Retail Economics and online marketplace Tradebyte.

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World’s largest food awards move judging panel from UK to Ireland to avoid Brexit red tape

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Due to new import controls, a judging session for the Great Taste awards is being held outside the UK for the first time in 30 years

The Great Taste awards are a British success story – the world’s largest food awards, celebrating the best products on the planet. But new post-Brexit import controls have forced the organisers to hold a judging panel outside the UK for the first time in the awards’ 30-year history.

On Sunday, judges from the Guild of Fine Foods panel will travel to County Tipperary in Ireland to spend three days tasting products that have become much harder to bring to the UK.

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UK inflation falls by less than expected to 2.3%, reducing chance of June rate cut

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Drop in April is smaller than forecast but level is still lowest in almost three years

UK inflation fell to 2.3% in April – its lowest level for almost three years – but the decline was smaller than expected, denting hopes of an early interest rate cut.

City analysts had forecast the annual increase in the cost of goods and services would fall to 2.1%, close to the Bank of England’s 2% target.

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Buenos Aires metro fare jumps 360% amid Argentina’s harsh austerity measures

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Libertarian president Javier Milei has slashed public spending as he wrestles to tame hyperinflation, now at 289% annually

Commuters in Buenos Aires have been hit by an overnight 360% increase in subway fares, in one of the most dramatic price hikes in a harsh budget austerity campaign launched by Argentina’s libertarian president, Javier Milei.

After weeks of hearings, a judge on Thursday lifted an order that had temporarily blocked the scheduled increase in subway fares. That cleared the way for the change to take effect on Friday morning as office workers across Buenos Aires streamed through the turnstiles of South America’s oldest underground metro.

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NHS spending rise lags behind Tory funding pledges, IFS finds

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Thinktank says extra funding eaten up by higher inflation despite greater demand with service in poor state of repair

Spending on the NHS in England has risen less quickly than the Conservatives promised at the last election despite the extra demand created by the pandemic and record waiting lists, a leading thinktank has said.

The Institute for Fiscal Studies (IFS) said increases in funding from the government had been eaten up by higher than expected inflation and, as a result, NHS day-to-day spending had grown by 2.7% a year during the current parliament – below the 3.3% pledged by Boris Johnson in 2019.

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‘Unfair banking’ and ‘damaging’ financial rules harming UK’s small firms, MPs warn

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Treasury committee says ‘debanking’ and use of personal guarantees for loans is putting small businesses at risk

Unfair banking practices and “damaging” financial regulators are harming small businesses and putting innovation and growth at risk, parliament’s Treasury committee has warned.

A report from the committee’s inquiry into access to finance for small and medium-sized enterprises (SMEs) said a lack of supportive policies were compounding problems for firms that had survived a “torrid” five years, which included the global pandemic and energy crisis.

“Confidence amongst SMEs in accessing finance has fallen and acceptance rates for business credit has lowered significantly,” the report said.

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Rachel Reeves accuses Tories of ‘gaslighting’ public over economy

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Shadow chancellor will highlight Labour’s plans to boost economy and say Conservatives are ‘out of touch’

Rachel Reeves will draw the economic battle lines for the next general election on Tuesday, challenging the government’s claims that the economy is turning a corner when millions are still struggling with the cost of living.

The shadow chancellor will accuse Rishi Sunak and Jeremy Hunt of “gaslighting” the public with over-optimistic statements about the UK economy that are “out of touch” with most people’s lives.

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Labour membership falls by 23,000 over Gaza and green policies

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Party claims financial position still strong as it continues to hold a commanding lead in opinion polls

Labour has suffered a sharp fall in membership over the past two months following controversies over its policy on Gaza and its U-turn on green investment, according to figures released to its National Executive Committee (NEC). The drop of more than 23,000 members comes despite the party holding a commanding lead in the opinion polls, which suggests it is now seen by the wider electorate as ready and able to form the next government, after 14 years of Tory rule.

Labour sources said the party’s overall financial position remained strong despite membership subscriptions falling off, because donations large and small were healthy, and the expectation was that the unions would still give very substantial backing to the election effort.

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UK government borrowing higher than expected in February

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Borrowing of £8.4bn last month could threaten OBR forecast for £114.1bn deficit for 2023-24 as a whole

Jeremy Hunt has been handed disappointing news from the public finances after government borrowing was higher than expected in February, leaving the national debt at the highest levels since the 1960s.

The Office for National Statistics said public sector net borrowing was £8.4bn in February, £3.4bn less than in the same month a year ago. However, it was higher than any economist expected in a Reuters poll that predicted a deficit of £6bn.

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Tory party fined £10,750 by Electoral Commission for not accurately reporting non-cash donations – UK politics live

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Donations were related to an employee seconded to the party by a donor

The Conservative party has been fined £10,750 by the Electoral Commission for failing to accurately report non-cash donations worth more than £200,000.

The donations related to an employee who had been seconded to the party by a donor. The commission said:

The party under-reported non-cash donations, in the form of an employee seconded to the party by a donor between April 2020 to December 2023. The non-cash donations were under reported by more than £200,000, when the seconded employee went from part-time to full-time work at the party.

The party also reported late a single non-cash donation relating to the same seconded employee, in December 2023.

Our investigation into the Conservative and Unionist Party found a number of donations inaccurately reported or reported late. The political finance laws we enforce are there to ensure transparency in how parties are funded and to increase public confidence in our system, so it’s important donations are fully and clearly reported.

Where we find offences, we carefully consider the circumstances before deciding whether to impose a sanction. We take into account a range of factors before making our final decision, including proportionality.

Penny Mordaunt is not going to become the leader of the Conservative party with a coronation. That idea is inconceivable.

In defence of Rishi Sunak, it is quite hard for a leader to be, at this stage in his leadership, significantly more popular than the party, because the two get quite closely identified and the Conservative party’s popularity fell before Rishi Sunak did, so I wouldn’t hold him personally responsible.

I think we’ve been in office for a long time, and I agree with you that the changes of leadership didn’t help. I was not in favour of removing Boris Johnson, as you may remember, but that has happened and parties need to deal with the current situation, not what might have been.

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Kristalina Georgieva wins backing to run for second term as IMF chief

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Bulgaria’s ‘eternal optimist’ in favour with European finance ministers after first five-year stint encompassing Covid and Ukraine

The head of the International Monetary Fund, Kristalina Georgieva, will run for a second five-year term after being nominated by a string of European countries to lead the global lender.

The Bulgarian economist and champion of policies to tackle the climate crisis will be given the support of her home country, which said she had accepted the nomination for another term starting in September.

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UK mothers earned £4.44 less an hour than fathers in 2023, finds analysis

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‘Motherhood penalty’ appears to be worsening, with pay gap for median hourly pay growing by 93p an hour since 2020

The “motherhood penalty” is wreaking havoc on women and the economy, according to campaigners, as fresh analysis reveals that the pay gap between mothers and fathers in the UK has grown by nearly £1 an hour since 2020.

A study of the hourly earnings of mothers and fathers, released on International Women’s Day, found that on average mothers earned 24% less an hour than fathers in 2023 – a “motherhood pay penalty” of £4.44 an hour.

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