The week’s Autumn Statement was quite pessimistic about the growth outlook of Britain. The accompanying OBR analysis forecast growth will be below 1.5 per cent on average over the next five years, and even by the end of the period the growth in potential output is only up to 1.75 per cent. And on this
The new Prime Minister has said this week that NHS funding will be ‘prioritised’ when it comes to spending decisions, while NHS bosses seek up to £7 billion in extra funding. That is wrong. In 2000, government health expenditure in the UK was equivalent to about 14 per cent of total public spending. By 2009, as the Labour government
Rishi Sunak has passed the 100 publicly-declared supporters which, it if is converted to nominations when Sunak officially declares, will meet the threshold required to make Monday’s MPs vote. Boris Johnson (like Sunak, not yet officially declared a candidate), is somewhat behind at around 70. Penny Mordaunt, who officially declared on Friday, is further back,
Markets are nervous and they are right to be. The government has announced a huge, open-ended package of energy subsidies expected to cost over £100 billion but that could cost over £200 billion if energy prices rise and stay high. At the same time, the Bank of England is making large losses on its QE
New Chancellor Kwasi Kwarteng’s first ‘fiscal event’ was always going to be quite provocative and exciting. But in the end it went quite a lot further than expected. Far from pulling back when faced with the practicalities of being in office, Truss’s new administration did everything it had signalled, controversial or not, then threw in
Liz Truss’s statement that she would never authorise another lockdown and The Spectator’s interview with Rishi Sunak have triggered a new debate about whether the lockdowns of 2020 and 2021 were justified. The most widely discussed positions are that lockdown occurred too late or that there should never have been any lockdowns at all, alongside
What policies should the government adopt in response to the energy crisis? When thinking about any policy, the correct place to start is to consider what kinds of solutions the market would produce absent any government intervention. Markets will always produce some kind of answer, and the market answer will often be very good in
Household energy bills are rising very rapidly, and are now expected to be over £4,000 per year by October and possibly over £5,000 per year by early 2023. Many commentators, including most notably Gordon Brown, are saying that we should now nationalise the energy companies and bring bills down. Would that help? It’s rather unclear
One of the key dividing lines of the current Tory leadership contest concerns economic policy. The gap between the candidates is not actually very large, but of course political arguments often magnify small differences. And in this case there quite an important philosophical difference that could have significant consequences over the longer-term. Broadly speaking, Rishi
The past six years have been a turbulent and controversial time in British politics. Through them all, one person consistently delivered progress, not deflected by the chaos around her. As others made headlines, Liz Truss made deals. Having been environment secretary under David Cameron, Truss was justice secretary and lord chancellor then chief secretary to
The Conservatives are selecting a new leader, who will become Prime Minister. What sort of a person should that be? It needs to be someone with the spark or edge of a leader, able to carry others with them – not just a clubbable ‘Yes Man’ type. It needs to be someone able to press
Boris Johnson has been given so many second chances. He hasn’t taken any of them. Let’s start with his voting for Theresa May’s terrible Brexit deal. Despite this, when Theresa May resigned he was backed by Leavers and became PM. Having become PM he didn’t, as he should have done, back a no deal, and
The Tories took a serious beating in Thursday’s by-elections. Whilst Boris Johnson and his government refuse to take responsibility for the big issue of the day – inflation – and fail to convey any meaningful central purpose to their government (‘levelling up’ being clearly nothing more than an empty soundbite) they will continue to face huge
Most people date the beginning of Boris Johnson’s current woes to the start of the partygate scandal, and especially to the revelations from 10 January 2022 onwards about the ‘bring your own booze’ event that Johnson himself had attended. But Johnson’s problems can also be seen as having started at an earlier date and from
Inflation has hit a 40-year high. The cost of household utilities rose by an average of £700 last month. We are now facing inflation of 9 per cent and the figure is still careering upwards. In response, politicians and ministers have attacked the Bank of England. Some commentators have even started to call for Governor Andrew Bailey to
Labour MPs and parts of the media are currently exploring, as part of the partygate scandal, whether if you repeat often enough that someone has lied, you can make that an accepted fact, even if you do not have a shred of evidence or reason to believe it. The latest example came in the Commons
Keir Starmer, aided and abetted by Boris Johnson’s many internal enemies within the Conservative party, has managed to get into the public consciousness the idea that if Boris Johnson attended a ‘party’ during lockdown, he should resign. There are a number of good reasons that the Tory party might feel it was time for a new
Today the government has said that for the next three weeks it will be mandatory to wear masks in shops and on public transport, pending a review. It was already mandatory to wear a mask on the tube, as a condition of travel. So to avoid mixing up ideas, let’s focus on the new mandate
The Treasury’s analysis of the short-term impact of Brexit offers us two scenarios for the two years following the referendum: a base ‘shock’ and a ‘severe shock’ scenario. The base case means 3.6pc less economic growth in the two years following Brexit, with inflation up 2.3 percentage points and house prices down 10pc. A first thing to grasp is the connection
Dear David, From Q2 1979 to Q1 1981, quarterly real GDP fell in the UK by 5.5%. Unemployment rose rapidly, from 1.4m in Q2 1979 to 2.4m by the end of the recession, then continued rising through to its peak of 3.3m in 1984 – 12% of the workforce. Unemployment stayed above 3m for 51 straight
