The UK leaves recession – but is it too late for the Tories?
Spectator (UK)May 04
The Facts
Overview: The UK is the world's sixth largest economy in terms of nominal GDP and fourteenth largest by purchasing power parity. The service sector accounts for 81% of economic output, with the financial sector playing a particularly important role. The government's economic policy is developed by His Majesty's Treasury, while the Bank of England (BoE) is responsible for setting interest rates, quantitative easing, etc.
Economic growth: According to the Organisation for Economic Co-operation and Development (OECD), the UK economy has recovered to pre-pandemic levels following the immediate effects of COVID and Brexit. It places fifth (at 1.7%) out of the six G7 members with available data for GDP growth between 2019 Q4 (pre-pandemic) and 2024 Q1. In 2024 Q1, UK real GDP grew by 0.6%, having entered a technical recession during the last two quarters of 2023. While the OECD predicts UK GDP will grow 0.4% and 1.0% in 2024 and 2025, respectively, ranking joint sixth and seventh out of G7 nations, the International Monetary Fund (IMF) predicts the UK will grow instead by 0.5% and 1.5%, placing sixth and third.
The Spin
Tory narrative
Following a tough couple of years, the UK economy is now beginning to reap the rewards of strong and stable governance. The fastest growth in two years and tumbling inflation is by no means an accident — the British public can remain optimistic about the future of their country under the lead of the Conservative Party.
Labour narrative
The Tories have destroyed the economy. Amidst doubling national debt and skyrocketing mortgages, Sunak has called an election earlier than expected because he knows his policies have failed. With no more room for tax cuts in the second half of the year, the prime minister has finally resigned his fate to the British public.
Reform narrative
Polling shows that the British people neither trust Labour nor the Conservatives with being responsible for lowering taxes and managing the UK economy. The public is resigned and pessimistic over the direction of the country — irrespective of whether Reeves or Hunt holds the keys to the Treasury.
Progressive narrative
UK capitalism has never recovered from 2008, leaving the average individual nearly £15K ($19K) worse off than they should be. Following historic decline, the Tories cannot be trusted with another five years in power, and it's clear that the change the country needs will not be found in Starmer. Now is more important than ever for people to come together and fight the pro-austerity, anti-worker norms that continue to hold the UK hostage.