Britain is on the brink of a recession. Revised figures show zero growth in the three months from July – when Labor was elected – to September.
If the economy has contracted this last quarter, it means we are close to two consecutive quarters of negative growth and we are in recession territory.
UK growth figures also indicate that living standards fell over the period, with GDP per capita falling rather than remaining flat as initially thought.
Moreover, living standards could be revised lower when officials update net migration figures next month.
If that’s not bleak enough, recruiters are warning that Britain is already in a ‘recruitment recession’, while the Confederation of British Industry says we are facing ‘the worst of all worlds’, with companies are reducing production, cutting back on hiring and preparing for higher prices. next year.
Making matters worse, government borrowing costs have risen to levels not seen in more than a year as investors lose confidence in Britain. Hopes for further interest rate cuts have been dashed as inflation is on the move again.
A budget for growth? Rachel Reeves postponed her statement until October, but continued to talk about the economy for months – this move has backfired
So what do you think Rachel Reeves had to say about this cheerful midwinter forecast? These numbers “only fuel the fire to deliver results for working people.”
What planet is Reeves on? And her continued use of “working people” is not only annoying, but deeply patronizing.
It takes a particularly close Chancellor to inherit a pretty bad economy – but one showing healthy signs of growth – and send it into a nosedive in just under six months.
Yet that is exactly what Reeves has accomplished since taking office.
First came her constant, and often vindictive, negative criticism of the economy, a move that undermined rather than strengthened confidence. Secondly came the disastrous budget with a record £40 billion tax increase and higher borrowing and spending.
You reap what you sow. The Chancellor has made mistake after mistake, with many policies simply wrong. Take the damaging rise in employer tax in NI, which won’t rise as much because companies will stop hiring.
The abolition of the small business property exemption and changes to inheritance taxes for farmers will be devastating for growth and food security.
VAT on school fees means higher costs for the state. These were all mistakes for beginning schoolboys. Some may say jokes.
In any other government they would have been dismissed as unworkable before the Budget by the idiots at the Treasury or by economists.
The strange thing is that Reeves seems to have made no effort to bring heavyweight economists on board to help, as Tony Blair and even Gordon Brown did.
Perhaps she believed too much in her own myth that she was a Bank of England economist? Until now, Keir Starmer has left the management of the economy to Number 11.
He has not interfered as so many Prime Ministers like to do, because he has no idea or because he is not interested.
But that could change now that Reeves’ reputation is in tatters. In just a few months, she has gone from a one-time corporate hit to a potential star who will go down in history as one of the worst chancellors.
She could still change course. Yet there is no sign of that. On the contrary.
The question now is whether Starmer is ruthless enough to be gunned down by the country’s first female chancellor, and perhaps one of its shortest-serving chancellors.
The books are now open for bets on how long she will last.