Chancellor Jeremy Hunt will set out his plan to boost growth on Friday, as criticism mounts over the government’s plan for the economy. In his speech in central London, Mr. Hunt will outline the opportunities in what he called “the growth sectors which will define this century”. He will also pledge to build on “the freedoms which Brexit provides”. But it comes in a week the government has faced accusations that it has no long-term plan for growth. On Monday, the CBI business group warned the UK is lagging behind rivals on green growth.
The next day, insolvency firm Bigbie’s Traynor said the number of firms on the brink of going bust jumped by more than a third at the end of last year. And on Thursday, car firms warned the UK has not got a strategy to attract manufacturers. Speaking at Bloomberg’s Headquarters in London, Mr. Hunt will set out how the government plans to achieve growth in multiple sectors across the UK.
The speech will focus on key growth industries such as digital technology, green industries, life sciences, advanced manufacturing, and creative industries. He will also set out a long-term plan to tackle poor productivity. “It is a plan necessitated, energized, and made possible by Brexit which will succeed if it becomes a catalyst for the bold choices we need to take,” he will say. Looking at the wider picture, Mr. Hunt will say that “diclinism about Britain” was wrong before and is wrong today, adding that some downbeat forecasts “do not reflect the whole picture”.
He will praise what he calls “British genius and British hard work”, and promise to turn that into prosperity in the long term. It is the chancellor’s first big economic speech since he took office in October, outside of the Autumn Statement and his speech to reverse most of Liz Truss’s mini-budget. In his Autumn Statement last November, Mr Hunt revealed tax rises and spending cuts worth billions of pounds aimed at mending the nation’s finances. Many will see this latest speech as an attempt to respond to criticism that the government has no long-term plan for growth, in the face of the global economic shift. That idea has been increasingly openly articulated, including by car makers this week.
On Thursday, new figures from the Society of Motor Manufacturers and Traders (SMMT) showed the number of new cars made in the UK has sunk to its lowest level for 66 years. UK car production was further set back by the collapse into administration of British volt last week.
The firm had planned to build a giant factory to make electric car batteries in Cambois, near Blyth in Northumberland, but the project ran out of money. Car firms warn that the UK is lagging behind other countries, particularly on offering state aid to manufacturers. The boss of the SMMT, Mike Hawes, conceded that the UK could be in the unenviable position of offering less support to crucial industries than before it left the EU.
Economy Concerns
Data out on the UK economy in recent weeks has painted a mixed picture. Price rises in the UK slowed for a second month in a row in December, but the cost of food including milk, cheese and eggs kept inflation at a 40-year high. Meanwhile, wages have grown at the fastest rate in more than 20 years, but are still failing to keep up with rising prices. Figures on Tuesday showed Government borrowing hit a new high in December, driven by the cost of supporting households with their energy bills and rising debt interest costs. And on Wednesday, the independent Office for Budget Responsibility told the government that it had overestimated the prospects for medium-term growth and that it planned to downgrade its outlook, The Times reported. The downgrade would leave Mr Hunt with less room to manoeuvre ahead of his Budget this March.
