Britain’s economic recovery has left Labour and the Tories tongue-tied

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Indeed, the most recent predictions from the big forecasters look excessively pessimistic. Earlier this month, the OECD downgraded Britain’s growth forecasts from 0.7pc this year to 0.4pc; while last month the IMF downgraded Britain’s 2024 prospects to 0.5pc. Even the OBR’s forecasts around the Budget – forecasting 0.8pc growth this year – are thought by some to be too gloomy.

Of course there is no guarantee that the UK will continue on its upward swing. But even bad economic news puts Labour on shaky territory. Do the policies they have announced thus far really instil confidence that Keir Starmer will deliver the growth he has promised?

More regulation, greater government spending, more restrictions on businesses around employment and potentially higher taxes. At the very best, Labour might hope for a Joe Biden-style sugar rush – something Americans have seen right through. But unlike the US, Britain does not have the scope to borrow for even a temporary boost.

It’s not just Labour – both parties struggle to align their political agendas with economic growth. Both are promising a crackdown on legal migration, insisting that current net figures are too high. Yet were either party to deliver on reducing this figure (and that’s a big if), GDP would almost certainly dip too.

Rishi Sunak and Keir Starmer’s hands are tied: they are able to speak about elements of the economic story playing out in the UK, but not the entirety. This disconnect becomes even more obvious when the ONS’s chief economist is quoting a former Australian prime minister about the economy “going gangbusters”, while the Government overseeing that economy won’t dare to make such a bold claim.

And arguably they shouldn’t. Growth of 0.6pc might have exceeded all expectations, but that bar has been set woefully low. The most recent figures might show the UK is out of recession, but they don’t indicate we are on the cusp of an economic boom. Indeed none of the forecasts, even the optimistic ones, expect to see the 2.5pc or 3pc growth needed to transform living standards and boost prosperity.

Perhaps that’s another reason no politician wants to discuss the full economic picture: it’s not just about what’s included, but what’s missing.

This article was originally published by a

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