An unsure government leads to a stifling of capital injected into businesses. Strong leadership allows for entrepreneurs and investors to plan, and it's what the UK desperately needs in order to grow.
This problem of uncertain is exacerbated by the longer term inability to control the public finances. We know that various forms of welfare, social care, the defence bill and the NHS will creep up, yet as of yet have been unwilling to either raise taxes or make the hard choice and decide what has to get frozen or cut. Where we do make cuts, it is often to the bone and muscle of the state (justice and prisons being a recent standout example), whilst the largest items of spending continue growing.
The effect of this is that whilst business may get a tiny sugar rush from short term handouts in the budget, they know that long term financial adjustment is inevitable. Until you deliver a budget that makes long term sense, business will lack any confidence to invest.
Look at GDP per hour worked since 2005 and the UK, which was rather behind most of its peers, largely caught up. The US was an anomaly and pulled ahead. So the UK has not been a disaster, bar the well-researched and well-documented madness of Brexit.
Given Reeves isn’t going to reverse Brexit her nonsense about the Tories killing productivity with her about to change it is absurd. That has been shown in her budgets; nothing apart from bungling. Her inability to control spending when things are only going to get harder and harder together with her appalling claim to improve her fiscal headroom when a large part of it is through efficiency savings which are clearly impossible is reckless at best. She is creating a breeding ground for economic and political instability.
This problem of uncertain is exacerbated by the longer term inability to control the public finances. We know that various forms of welfare, social care, the defence bill and the NHS will creep up, yet as of yet have been unwilling to either raise taxes or make the hard choice and decide what has to get frozen or cut. Where we do make cuts, it is often to the bone and muscle of the state (justice and prisons being a recent standout example), whilst the largest items of spending continue growing.
The effect of this is that whilst business may get a tiny sugar rush from short term handouts in the budget, they know that long term financial adjustment is inevitable. Until you deliver a budget that makes long term sense, business will lack any confidence to invest.
The FT have deep dived the biggest lever for growth: reverse Brexit; major planning deregulation; build baby build; cheap nuclear energy;
Look at GDP per hour worked since 2005 and the UK, which was rather behind most of its peers, largely caught up. The US was an anomaly and pulled ahead. So the UK has not been a disaster, bar the well-researched and well-documented madness of Brexit.
Given Reeves isn’t going to reverse Brexit her nonsense about the Tories killing productivity with her about to change it is absurd. That has been shown in her budgets; nothing apart from bungling. Her inability to control spending when things are only going to get harder and harder together with her appalling claim to improve her fiscal headroom when a large part of it is through efficiency savings which are clearly impossible is reckless at best. She is creating a breeding ground for economic and political instability.