Ahead of the EU referendum Remain claimed the economy would hit all sorts of troubles if we voted to leave. I was particularly interested therefore to see this week that the official figures for consumer spending in the April to June quarter rose by 0.9%. The Office for National Statistics estimates the economy grew at 0.6% overall in the second quarter. The figures for retail sales in July showed a growth of 5.9% compared to July 2015. Only one month and it would be unrealistic to expect that level of growth to continue but it provides a boost for retailers and is some evidence of the confidence consumers have. We need Companies to demonstrate similar confidence in the future when it comes to investment decisions.
Of course, I expect there will be downturns in the future. Leaving the EU will not prevent the UK from being affected by slowdowns elsewhere in the World. What matters is that the UK does all it can to take maximum advantage of the freedom it will have to negotiate new trade deals with Countries around the World to make it easier for our exporters.
Latest figures from the British Retail Consortium show that sales on the High Street were up 1.9% in July compared to the same period last year. This will no doubt confound the prophets of doom who predicted the opposite in the run up to the referendum. The difference between these figures and some other far gloomier numbers is that these are based more on reality rather than individuals predictions of what they believe will happen. I still think that one of the biggest dangers the UK economy faces is lack of confidence caused by people talking down our prospects. Of course there will be setbacks and downturns there always are in any economy but we must not talk ourselves into a downturn.
As the long campaign ahead of the general election on 7th May gets underway there will be countless articles written about the pros and cons of each parties policies but the truth is that without a strong economy everything else falls by the wayside.
Since the coalition Government came to power nearly 5 years ago much has been done to improve the economic state of the country. For the first two or three years the opposition constantly complained that the Government were going too quickly. the claim that the Government was going ‘too far and too fast’ was repeated at every opportunity. Now strangely the opposition claim the Government have not gone far enough! If the Government had followed their advice we would not have made the progress we have.
We can debate which measure should be used to measure the progress made and whether the annual budget deficit has been cut by a third or by a half but what really matters is that the Conservative led Coalition Government have put the country back on the road to recovery. The choice before the Country on My 7th is whether to stay on the road to recovery with the safety and security that brings or turn back and risk chaos and confusion with the Labour Party who left the Country with such a huge budget deficit in the first place.
This week’s Autumn Statement has confirmed that our economy is growing. In fact the independent Office for Budget Responsibility has upgraded its forecast for growth in the current year from 2.7% to 3%.The UK now has the fastest growing economy of any of the major advanced economies in the World. Unemployment is falling and inflation is low and expected to remain low.
Of course crystal ball gazing when it comes to the economy is always a tricky task. There are so many variables. The deficit is still too large that is to say the Government is still spending more each year than it collects . Each year the shortfall gets added to the nations debts. In essence we are spending money today that we are expecting our children and grandchildren to repay. that is why it is essential we finish the task we have begun.
The Autumn Statement covered many areas of great importance not least was the revolution in stamp duty the tax we pay when we buy a house. from midnight last night 98% of all homebuyers will pay less tax and in Bury it will be virtually every home buyer.
The very latest figures released today have confirmed that the British economy is continuing to grow providing further evidence that the Conservatives plan for rebuilding our economy is working.
Over the last quarter the economy grew by 0.8% and that means it has grown by 3.1% over the last year. It is only by having a growing economy that we can provide security for families and improve the living standards of hardworking families across Bury, Ramsbottom and Tottington.
Encouragingly, for the first time in a decade all the three main sectors of our economy have grown by at least three per cent over the last year That mean growth in manufacturing, growth in services and growth in construction so this is a broadly based recovery and not one based on just one segment of the economy.
‘Is it working?’ this is the crucial question which will determine the fate of the Conservatives and to an extent the Liberal Democrats in the months ahead. People will want to see that the deficit is being reduced and that there is light at the end of the tunnel. Progress may not be as fast as we would all like to seen but there is no doubt that the Government’s economic policies are bearing fruit.
This week it has been confirmed the economy grew by 0.3% in the first quarter. There have been one and a quarter million more jobs created in the private sector. There will always be changes in job numbers and changes in businesses plans such as that recently announced by Antler are never welcome. businesses are not set in stone, job losses in one area nad new jobs in another are how the economy develops.
But the fact remains that slowly but surely the policies are working. The deficit is being cut. We are moving in the right direction. Of course political opponents will claim it is all going wrong and they could do a lot better but as there is not much evidence people think Labour would do any better after all it was Labour who left the economy in this mess in 2010.
At a time when all our thoughts and prayers are with the many families affected by the tragedy in Norway the domestic news agenda will again be dominated by the economy. At a time when the Eurozone is in crisis, the banks are still struggling to overcome their problems, Japan is suffering the after effects of the Tsunami, the USA is facing huge debt problems it is perhaps not surprising that growth in the UK economy is not racing ahead.
A couple of weeks ago I was studying the results of an opinion poll on the publics understanding of our Countries economic position and in particular the size of the national debt. Incredibly 7 out of 10 people thought that we were going to repay £350 billion of the national debt during this Parliament rather than increase it by this amount which apparently is what is forecast to happen. Only 1 in 10 correctly said the debt would increase. The reason for this is that every day our national debt continues to increase because we are still not living within our means. All the various savings the Government are making are only having the effect of slowing the rate of planned increases in public spending which were theoretically due to take place. I say theoretically because there is little doubt that even had Labour stayed in Government the international pressure to control the budget deficit would have forced them to cut back on the planned rate of increases in pulbic spending.