Chancellor Rachel Reeves was all smiles on camera this morning, and taking selfies with BT Openreach workers near Gatwick Airport in Sussex after BT announced £5billion investment in improving broadband.
Ms Reeves was trumpeting economic growth, telling me on GB News the “economy grew by 1.3 per cent last year, a higher growth than the year before, and GDP per capita increased by 1 per cent last year after falling in five years under the previous Government. So we are growing our economy.”
She rejected Health Secretary Wes Streeting’s assertion in texts to the now disgraced Peter Mandelson the Government has “no plan for growth”.
The Chancellor hit back: “Wes Streeting was clear yesterday that one of the mistakes in his messages to Peter Mandelson was that we had no economic plan.”
But look past the smiles and the headlines, and all is not well. Sure, 1.3 per cent growth is better than nothing and better than the 1 per cent in 2024…but it’s hardly the growth the country needs, or anything like the levels we enjoyed before the financial crisis of 2008.
However, it hides an even bleaker picture.
Most of the growth was in the first quarter; in the last three months of the year, the economy grew by a measly 0.1 per cent.
Our vital services sector was flat for the first time in over two years, and construction was the worst for four years.
Rachel Reeves trumpeted economic growth during a chat with journalists
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GB NEWS
And in terms of GDP per capita, it’s even worse, falling for the last six months of last year.
And that’s the measure that matters to people, who desperately want to feel things are getting better.
Ms Reeves tried to reassure GB News viewers: “We’re bringing down the cost of living: £150 off of people’s energy bills from April, freezing prescription charges and train fares, continuing with the bus fare cap.
“All of those are putting the money in the pockets of ordinary working people. So they’ve got more money to spend in their high streets, in their local area.”
GB News’ Chief Political Correspondent Katherine Forster questioned the Chancellor about economic growth
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GB NEWS
But of course, Britons have to contend with huge tax rises, frozen tax thresholds and hits to businesses which they say are stopping them from hiring staff and investing.
It’s a far cry from the world Labour promised before their landslide: growth was going to fund the spending needed to turn the country around, they told us, with tax rises limited to non-doms and private schools.
How times have changed.
They also promised to “restore calm, competent Government” and “end the chaos”.
Yet this week has seen a Prime Minister cling to office by his fingertips, and cabinet ministers openly find fault with Labour’s record so far.
The very fact the Health Secretary’s words are now being used against the Government shows just the level of chaos of the week.
And it is likely going to get worse. For all the missteps of Ms Reeves and Sir Keir, if they are deposed, what follows?
Likely a Government further to the left, led perhaps by Angela Rayner or Ed Miliband. Likely a Government less concerned with keeping the markets onside.
Remember how the markets took fright when Rachel Reeves cried in the chamber. Markets like stability. Not change, not chaos.
The PM is the most unpopular in modern history, and Reeves is widely thought to have made growth harder to come by through her tax rises and demands on business.
But perhaps the many who think MPs should roll the dice and try again should be careful what they wish for.
