Latest news with #AnandMenon
Gulf Today
21 hours ago
- Politics
- Gulf Today
Who cares that Britain is on course to be ‘minority white'?
Anand Menon, The Independent Language is a funny thing. This week, a new report appeared to warn that the white British population could be a minority in the UK within 40 years. And it has brought out the worst in some of us. An analysis of migration, birth and death rates by the University of Buckingham suggests the white British population is set to fall from its current 73 per cent, to 57 per cent by 2050, before becoming a minority by 2063. One newspaper's report explained, rather curiously, that white British is 'defined as people who do not have an immigrant parent'. Bad luck, then, all you non-white kids of an Irish, French or German parent. Unlucky, too, King Charles, Winston Churchill and Boris Johnson. By this metric, it seems that you no longer qualify as white British. Beyond this rank stupidity, there is of course something else going on here. This is less dog whistle than plain old whistle. Dodgy extrapolations posing as predictions. Few people are spared. We're informed, presumably with some regret, that there is going to be a rise in the number of foreign-born people and of second-generation immigrants, all of whom could well be British. Further on, Matthew Goodwin, the author of the report, shifts the goalposts one more time, asserting that by 'the end of the current century, most of the people on these islands will not be able to trace their roots in this country back more than one or two generations'. And then, of course, we have the equating of 'foreign-born and Muslim populations', implying, presumably, that if you're Muslim, you just don't cut it wherever you happen to have been born. If the problem that this country simply isn't white enough, someone may as well just come out and say it. Because it's clear the issue here isn't Britishness. There is a serious debate to be had not only about immigration, but also about integration. Happily, the country that most of us inhabit is a place where both ethnic and religious integration is a daily reality for millions of families, including my own. While I think we in the UK do rather better at this than many of our Western peers, there is still more that can and should be done. There is also a conversation worth having about what a manageable level of immigration might be, and whether immigration policy is fit for purpose. This, however, is not the way to have those conversations. Indeed, potentially inciting distrust and dislike between different communities is not how anyone sensible would go about, in the words of the report itself, 'informing, rather than polarising'. That is the only conclusion that I can draw from their sloppiness. If, after all, their aim really was to 'inform, rather than polarise', they might spend more time explaining that forecasts are not predictions. They might explain that there is good evidence that the total fertility rate among immigrants tends to fall over time. That the population projections Goodwin has used — calculations based on assumptions about fertility, mortality and migration — are already massively outdated, and become even less reliable the further forward one projects. But no, there is no such nuance to be found. Merely certainty that the findings are certain to spark a 'considerable degree of anxiety, concern and political opposition' from those who oppose immigration. And let's think about this in a global context for a moment. The world is changing, its balance of power is shifting steadily eastwards. Demographically — and I'm sorry about this — it is becoming less, not more, white. Relatively small countries like the UK will have to work ever harder to compete and to attract talent in this new world order. Do we really think that bemoaning the insidious impact of non-white foreigners who cannot trace their ancestry back several generations is going to help us in this task? But what I do know is that I'm not only not white, but apparently not British, either.
The Guardian
19-05-2025
- Business
- The Guardian
Spirit of willing and quiet resolve land UK-EU deal, but not without late wrangles
For weeks, Keir Starmer had stayed tight-lipped about what he was putting on the table in his negotiations as part of the UK-EU deal, saying in line with Brussels: 'Nothing is agreed until everything is agreed.' But then just days before Monday's summit, the prime minister appeared to make a concession and pave the way for a youth mobility scheme, telling the Times in an interview: 'Youth mobility is not freedom of movement.' People close to the talks say French officials seized this as their moment to push much harder on fishing rights, arguing for indefinite quotas rather than the four-year ones which British officials thought had been accepted. The talks lasted until about 2am on Monday morning, when the prime minister finally signed off on a deal which included 12-year-long quotas instead. 'There was a last-minute wrangle over fish which went right up to the wire on Sunday night,' said one British government source. A European official added: 'The UK's final offer had been four years, but even by Sunday night we were yet to square the circle.' Anand Menon, the director of the UK in a Changing Europe thinktank, said: 'The EU has used the fact that we were the demandeur to leverage what they have long wanted. The French will be absolutely chuffed, there is no doubt that we had to concede on that.' It was a big last-minute concession by Starmer, but one which allowed him to stand up about 12 hours later and declare: 'Britain is back on the world stage.' Despite his best efforts to restore order to Britain's international relations, the final 48 hours of the prime minister's first big negotiation with Brussels ended in much the same way those of his predecessors did – with frantic phone calls and late-night concessions. Both sides however say the trouble was worth it, bringing certainty to businesses on both sides of the Channel and reinforcing the UK's position as a trusted external partner to the EU. Starmer's aim from the beginning had been to show that EU negotiations could be done differently – quietly and without what he calls 'megaphone diplomacy'. It was an approach that infuriated some. Kemi Badenoch, the Conservative leader, accused the prime minister on Monday of conducting 'secret negotiations away from parliament, the media and the public'. But British officials say that this veil of secrecy was essential to agreeing such a complex deal which could have tripped on any one detail, and nearly did so at the 11th hour. But if Starmer's public position was emollient, behind the scenes, negotiators say the UK was demanding a lot from its European partners. 'Britain came to these talks with 50 different demands,' said one European source. 'This deal benefits everybody, but it would be wrong to suggest the UK did not get a lot of what it wanted.' For months the detailed negotiations have been led by Nick Thomas-Symonds, the Cabinet Office minister who is close to Starmer and whose office is linked to Downing Street by a corridor at the back of Whitehall. Others in the cabinet have taken the lead on different aspects of the deal, however, such as the foreign secretary, David Lammy, and the defence secretary, John Healey, on the defence and security pact. Healey said: 'Back in July, you didn't have the UK leading the coalition of the willing [in support of Ukraine]. You didn't have the Trinity House agreement [between Britain and Germany]. You didn't have the prospect of an EU-UK defence agreement. All things are part of strengthening British security.' The harder elements to agree however were on a future youth mobility scheme as well as how long both the agricultural trade pact and the fishing deal should last. The UK ideally wanted a one-year fishing agreement and an indefinite agricultural one. Officials thought they could secure such a deal by offering up a youth mobility scheme, which is badly wanted in many European capitals. But when Starmer appeared to give way on the mobility scheme, it allowed the French to make a new demand: if the agricultural trade deal was to be indefinite, then the fishing quotas should be too. If one was to be time-limited, both should be. With the two sides at a standoff, EU ambassadors met three time within five days in an effort to avert diplomatic disaster. When they met at 2.30pm on Sunday, the text was still not agreed. Over a long and exhausting day of negotiations, officials worked until the early hours trying to untangle the last-minute disagreement. In the Cabinet Office, Thomas-Symonds and his team ordered a Nando's takeaway while they made repeated calls to European capitals and back to Downing Street. The cross-continental phone calls irritated some in Brussels, who felt that Britain was trying to play 'divide and conquer' with European capitals much as they felt Boris Johnson had done in the past. Also causing irritation was a press release which Downing Street issued on Saturday stating baldly: 'This week, the prime minister will strike yet another deal that will deliver in the national interest of this country.' Even as the negotiations continued, European leaders began landing in London on Sunday evening. Ursula von der Leyen, the president of the European Commission, arrived at about 7.30 – her flight having been tracked minute-by-minute by some junior British officials. Kaja Kallas, the high representative for foreign affairs, landed two hours later. At 10.30pm, the British sent their final substantive proposals, including, crucially, the concession on fishing quotas. Even then, talks went on for another four hours as officials argued, in the words of one, 'over commas'. None of the last-minute tensions were apparent on Monday lunchtime, however, as Starmer and several of his cabinet presented the deal at a chummy press conference in central London. The delegations had originally sat separately but at the suggestion of Maroš Šefčovič, the EU trade commissioner, they all swapped places so they could sit among each other. 'That's what this deal is all about,' Starmer told the press conference. 'Building the relationships we choose, with the partners we choose and closing deals in the national interest.' Speaking on the BBC Radio 4 on Monday morning, Kallas had a slightly different take: 'Any deal means making compromises on both sides. If both parties are not entirely happy, that means it's a good deal.'
Yahoo
18-05-2025
- Politics
- Yahoo
Defence deals and palace invites: UK and EU haggle before first summit since Brexit
"Don't expect miracles. But do know - everyone wants this to work." On Monday in London the EU and UK hold their first bilateral summit since Brexit. Symbolically, this is a big moment. Officials and analysts I speak to, on and off the record, like the individual I just quoted, are quick to point out difficulties that exist between the two sides. But all acknowledge the bilateral bitterness provoked by Brexit is no more. It's been eviscerated by the gravity of global events. Concerns about Russia and China, the war in Ukraine, the shock of the US under Donald Trump no longer prioritising European defence, plus a growing sense of voter insecurity is propelling the two powers to work closer together. European leaders pressure Russia over 30-day Ukraine ceasefire Trump has blown up the world order - and left Europe's leaders scrabbling "Failure to do so, in the current international context, would not be a good look," says Anand Menon, director of the think tank UK in a Changing Europe. Most European countries realise that, he adds: "Even the French." More than most EU countries, France has been playing hardball in pre-summit negotiations. Is it a coincidence that as talks went to the wire before Monday's summit, the UK announced that France's president has been invited for his first state visit? King Charles and Queen Camilla will host Emmanuel Macron and his wife at Windsor Palace in July. A UK attempt to butter up the French leader, perhaps? "It'll be interesting to see if they can agree common language [for a summit agreement]," says Georgina Wright, European policy expert at the Institut Montaigne. "Everyone in the EU wants closer relations with the UK right now and France doesn't want to be seen as the one country blocking closer UK-EU cooperation. But that does not mean that Paris is willing to give up on core interests." Interests like fishing rights in UK waters and bidding for EU defence contracts. Negotiating - or to be more accurate - haggling over the "meat" of the summit will, I'm told, continue till the last moment. On the day itself, we can expect three separate announcements: A joint declaration that addresses the worrying geopolitical situation and emphasises UK-EU shared foreign policy priorities - such as supporting Ukraine, keeping up pressure on Russia, and ending civilian suffering in Gaza An EU-UK security and defence pact A package of measures targeted at removing some trade barriers between the EU and UK that have come about because of Brexit These trade measures are the "reset" of relations with the EU that UK Prime Minister Sir Keir Starmer has promised since his party won a general election last summer. They are far from an economic gamechanger for the UK, though. Hardly what you'd call ambitious. Destroying all trade barriers with the EU is impossible if the Labour government keeps to its own "red lines" of not rejoining the bloc's customs union or single market. Despite promising to prioritise UK economic growth, and polls suggesting the majority of Britons want to do more trade with the EU, Labour will feel hemmed in by the increasingly popular, Eurosceptic Reform Party. It performed well in recent local elections in the UK. While some in Labour (quietly) admit they are tempted by a customs union with the EU to boost growth, any economic benefits would likely not be apparent to voters before the next UK election. Party members fear they would risk being punished at the polls, amidst accusations by the opposition Conservatives and Reform that the government would have betrayed Brexit. These concerns make the Starmer government "more cautious, less bold", says Mr Menon. The UK is taking a sector-by-sector approach to try reduce costly trade barriers with the EU. Many EU-UK negotiating hours have gone into agreeing a plant and animal health deal, known as an SPS agreement. This will facilitate the export and import of meat and plant products between the EU and UK and help reduce post-Brexit trade complications between Northern Ireland and Britain. In exchange, the EU insists the UK must agree to following any new SPS rules introduced in the future and accept a role for the European Court of Justice in policing the agreement. Those conditions will likely be unpopular with ardent Brexit supporters. They might also put backs up in Washington and complicate the UK doing a wider future deal on agriculture with the US, as the UK would be tied to stringent EU standards. But the Labour government knows public opinion polls suggest most people in the UK prioritise trade with the EU over the US. Currently the EU counts for 41% of UK exports; the US for 21%. The UK government will probably insist the SPS agreement is good for the British economy. Though animal and plant exports and imports are, in fact, a small part of overall GDP. In reality "growth is a bit of a red herring here", says Mr Menon. On the EU side, the French, backed by other fishing nations like the Netherlands and Denmark, have taken a tough stance in these talks - refusing to sign up unless the UK agrees to long-term EU fishing rights in UK waters. The current post-Brexit fishing agreement expires next year. The reset we'll hear about at Monday's summit will also include a "mobility" section. Starmer will get his ask, for the EU to recognise UK professional qualifications, to encourage cross-border business. There will also be a reduction in visa restrictions for UK musicians travelling and performing in the EU. In exchange, the EU - and Germany, most passionately - wants a youth mobility scheme, allowing young EU citizens to travel, study, and even work in the UK. The UK has similar schemes with Canada, Australia, South Korea and Japan, amongst others. But this has been tricky to agree. Reducing migration figures is a number one priority for the Labour government. It's a hot-button issue and the UK Home Office will seek to toughen conditions and limit EU numbers. UK edges towards youth visa deal with EU PM promises migration drop as he unveils plans for 'tightened' visa rules Negotiations are ongoing but, according to EU sources, the scheme already has a name: YES, or Youth Experience Scheme. Some areas of negotiation are more advanced than others. This will be reflected in Monday's announcement. There will also be talk at the summit of plans to tackle illegal migration, cooperate on carbon border taxes, and simplify energy trading between the EU and UK. Reducing EU-UK trade barriers on chemicals and pharmaceutical goods is also a UK ambition, as is getting access to EU databases, like the Schengen Information System, to better track down criminals. But for now, at least, the EU is saying no to that. If it makes an exception for the UK, other non-EU countries will demand the same, it insists. Of course, it's in the interest of both sides to fight cross-border crime. The UK argues the current state of the world calls for more flexible thinking from Brussels. The case for more flexible thinking is also something the UK is calling for when it comes to Monday's defence and security pact with the EU. The EU and UK already work closely together on Russian sanctions and defending Ukraine. And the pact isn't a legally binding document, so how complicated can these talks be, you may ask? The answer is pretty complicated. The UK wants its defence companies to be allowed to bid for contracts under the EU's new re-armament scheme, SAFE (Security Action for Europe). "The UK has earned the right to access such a deal because of the leadership it's shown over Ukraine," says international defence expert Sophia Gaston, a visiting fellow at King's College London. "Britain is a serious player both in traditional defence capabilities, like producing munitions, and in cutting edge defence innovation, where new growth and energy is. "If the UK has access to the emerging EU defence programmes, it can contribute to mass and pace. [The war in Ukraine] has shown that both are needed." But Ms Gaston admits, UK companies getting the go-ahead from Brussels is a "messy" process. "Re-Arm EU", as Brussels dubs its new drive, is still a work in progress, spurred by rapidly changing geopolitics, including fears the US will withdraw at least some of the crucial security support Europe has relied on since World War Two. This is not yet a fully formed EU strategy that the UK can "pay to play" a part in, as it has done post-Brexit with the EU's research and innovation scheme Horizon, for example. An agreement with the UK in this defence industrial context will be brand new and bespoke. And it's getting political. UK helped Ukraine and US reach ceasefire deal - government sources Germany's Merz promises to do 'whatever it takes' on defence Signing the security pact on Monday is just a step in the process. France wants to severely restrict non-EU companies bidding for the bloc's defence contracts, including the UK but Canadian and American firms too. If the EU is spending its taxpayers' money on defence, it argues it should be spent with EU companies to help boost EU economies. Paris also says, in this rapidly changing world of shifting alliances and allegiances, the EU should be self-reliant, not dependent on suppliers outside the bloc. Sceptics suspect France, which has a sophisticated defence industry, of wanting to hoover up lucrative EU contracts for itself. But it looks like it is losing the internal EU argument, with the Nordics, the Baltics, Poland, Italy and the Netherlands favouring more openness on defence contracts, and particularly with the EU's biggest economic power, Germany, championing the UK. "Germany and France have very different attitudes towards the UK," says German economist Armin Steinbach from think tank Bruegel. Germany will always put relations with EU heavyweights France and Poland first, says Mr Steinbach. But he believes the UK will be helped in defence and economic negotiations with the EU by new German Chancellor Friedrich Merz, who argues "a unified Europe is the absolute priority in the current geopolitical setting". A priority maybe, but it's still a hugely tall order because it's all about compromise. Political leaders will seek to justify increases in defence spending by insisting to voters that it's for their personal security and in the interest of their national economy, with boosts in revenue for domestic defence industries. But achieving a pan-European industrial base - built to be efficient, avoid duplication, and to replace much of the US capacity relied on by the continent today - would mean some European countries winning more defence contracts than others. It would also mean some national businesses shutting down, in favour of better-suited ones elsewhere on the continent. That's a hard sell for political leaders facing their voters. As is another big trade-off: Big increases in defence spending will mean governments have less money to spend on public services. The challenge for Europe is breathtaking. By comparison, Monday's symbolic EU-UK summit, may seem like a walk in the park. Is Britain really inching back towards the EU? UK business group calls for 'reset' with EU UK must 'do everything' to rebuild trade with EU, says Bank boss
BBC News
18-05-2025
- Business
- BBC News
UK and EU haggle over key points before first summit since Brexit
"Don't expect miracles. But do know - everyone wants this to work."On Monday in London the EU and UK hold their first bilateral summit since Brexit. Symbolically, this is a big and analysts I speak to, on and off the record, like the individual I just quoted, are quick to point out difficulties that exist between the two sides. But all acknowledge the bilateral bitterness provoked by Brexit is no more. It's been eviscerated by the gravity of global about Russia and China, the war in Ukraine, the shock of the US under Donald Trump no longer prioritising European defence, plus a growing sense of voter insecurity is propelling the two powers to work closer together. "Failure to do so, in the current international context, would not be a good look," says Anand Menon, director of the think tank UK in a Changing Europe. Most European countries realise that, he adds: "Even the French."More than most EU countries, France has been playing hardball in pre-summit it a coincidence that as talks went to the wire before Monday's summit, the UK announced that France's president has been invited for his first state visit? King Charles and Queen Camilla will host Emmanuel Macron and his wife at Windsor Palace in July. A UK attempt to butter up the French leader, perhaps?"It'll be interesting to see if they can agree common language [for a summit agreement]," says Georgina Wright, European policy expert at the Institut Montaigne. "Everyone in the EU wants closer relations with the UK right now and France doesn't want to be seen as the one country blocking closer UK-EU cooperation. But that does not mean that Paris is willing to give up on core interests."Interests like fishing rights in UK waters and bidding for EU defence contracts. Negotiating - or to be more accurate - haggling over the "meat" of the summit will, I'm told, continue till the last moment. On the day itself, we can expect three separate announcements:A joint declaration that addresses the worrying geopolitical situation and emphasises UK-EU shared foreign policy priorities - such as supporting Ukraine, keeping up pressure on Russia, and ending civilian suffering in GazaAn EU-UK security and defence pactA package of measures targeted at removing some trade barriers between the EU and UK that have come about because of Brexit Closer economic ties to Europe These trade measures are the "reset" of relations with the EU that UK Prime Minister Sir Keir Starmer has promised since his party won a general election last are far from an economic gamechanger for the UK, though. Hardly what you'd call all trade barriers with the EU is impossible if the Labour government keeps to its own "red lines" of not rejoining the bloc's customs union or single promising to prioritise UK economic growth, and polls suggesting the majority of Britons want to do more trade with the EU, Labour will feel hemmed in by the increasingly popular, Eurosceptic Reform Party. It performed well in recent local elections in the some in Labour (quietly) admit they are tempted by a customs union with the EU to boost growth, any economic benefits would likely not be apparent to voters before the next UK members fear they would risk being punished at the polls, amidst accusations by the opposition Conservatives and Reform that the government would have betrayed concerns make the Starmer government "more cautious, less bold", says Mr Menon. So what will be agreed at the summit? The UK is taking a sector-by-sector approach to try reduce costly trade barriers with the EU-UK negotiating hours have gone into agreeing a plant and animal health deal, known as an SPS agreement. This will facilitate the export and import of meat and plant products between the EU and UK and help reduce post-Brexit trade complications between Northern Ireland and exchange, the EU insists the UK must agree to following any new SPS rules introduced in the future and accept a role for the European Court of Justice in policing the conditions will likely be unpopular with ardent Brexit supporters. They might also put backs up in Washington and complicate the UK doing a wider future deal on agriculture with the US, as the UK would be tied to stringent EU standards. But the Labour government knows public opinion polls suggest most people in the UK prioritise trade with the EU over the US. Currently the EU counts for 41% of UK exports; the US for 21%.The UK government will probably insist the SPS agreement is good for the British economy. Though animal and plant exports and imports are, in fact, a small part of overall reality "growth is a bit of a red herring here", says Mr the EU side, the French, backed by other fishing nations like the Netherlands and Denmark, have taken a tough stance in these talks - refusing to sign up unless the UK agrees to long-term EU fishing rights in UK waters. The current post-Brexit fishing agreement expires next year. Free-er movement for some The reset we'll hear about at Monday's summit will also include a "mobility" will get his ask, for the EU to recognise UK professional qualifications, to encourage cross-border business. There will also be a reduction in visa restrictions for UK musicians travelling and performing in the exchange, the EU - and Germany, most passionately - wants a youth mobility scheme, allowing young EU citizens to travel, study, and even work in the UK has similar schemes with Canada, Australia, South Korea and Japan, amongst others. But this has been tricky to migration figures is a number one priority for the Labour government. It's a hot-button issue and the UK Home Office will seek to toughen conditions and limit EU numbers. Negotiations are ongoing but, according to EU sources, the scheme already has a name: YES, or Youth Experience areas of negotiation are more advanced than others. This will be reflected in Monday's will also be talk at the summit of plans to tackle illegal migration, cooperate on carbon border taxes, and simplify energy trading between the EU and EU-UK trade barriers on chemicals and pharmaceutical goods is also a UK ambition, as is getting access to EU databases, like the Schengen Information System, to better track down for now, at least, the EU is saying no to that. If it makes an exception for the UK, other non-EU countries will demand the same, it course, it's in the interest of both sides to fight cross-border crime. The UK argues the current state of the world calls for more flexible thinking from Brussels. Defence and security complications The case for more flexible thinking is also something the UK is calling for when it comes to Monday's defence and security pact with the EU and UK already work closely together on Russian sanctions and defending Ukraine. And the pact isn't a legally binding document, so how complicated can these talks be, you may ask?The answer is pretty UK wants its defence companies to be allowed to bid for contracts under the EU's new re-armament scheme, SAFE (Security Action for Europe)."The UK has earned the right to access such a deal because of the leadership it's shown over Ukraine," says international defence expert Sophia Gaston, a visiting fellow at King's College London. "Britain is a serious player both in traditional defence capabilities, like producing munitions, and in cutting edge defence innovation, where new growth and energy is. "If the UK has access to the emerging EU defence programmes, it can contribute to mass and pace. [The war in Ukraine] has shown that both are needed."But Ms Gaston admits, UK companies getting the go-ahead from Brussels is a "messy" process."Re-Arm EU", as Brussels dubs its new drive, is still a work in progress, spurred by rapidly changing geopolitics, including fears the US will withdraw at least some of the crucial security support Europe has relied on since World War is not yet a fully formed EU strategy that the UK can "pay to play" a part in, as it has done post-Brexit with the EU's research and innovation scheme Horizon, for agreement with the UK in this defence industrial context will be brand new and bespoke. And it's getting political. Signing the security pact on Monday is just a step in the wants to severely restrict non-EU companies bidding for the bloc's defence contracts, including the UK but Canadian and American firms the EU is spending its taxpayers' money on defence, it argues it should be spent with EU companies to help boost EU also says, in this rapidly changing world of shifting alliances and allegiances, the EU should be self-reliant, not dependent on suppliers outside the suspect France, which has a sophisticated defence industry, of wanting to hoover up lucrative EU contracts for it looks like it is losing the internal EU argument, with the Nordics, the Baltics, Poland, Italy and the Netherlands favouring more openness on defence contracts, and particularly with the EU's biggest economic power, Germany, championing the UK."Germany and France have very different attitudes towards the UK," says German economist Armin Steinbach from think tank will always put relations with EU heavyweights France and Poland first, says Mr Steinbach. But he believes the UK will be helped in defence and economic negotiations with the EU by new German Chancellor Friedrich Merz, who argues "a unified Europe is the absolute priority in the current geopolitical setting". Huge challenge of defence cooperation A priority maybe, but it's still a hugely tall order because it's all about leaders will seek to justify increases in defence spending by insisting to voters that it's for their personal security and in the interest of their national economy, with boosts in revenue for domestic defence achieving a pan-European industrial base - built to be efficient, avoid duplication, and to replace much of the US capacity relied on by the continent today - would mean some European countries winning more defence contracts than others. It would also mean some national businesses shutting down, in favour of better-suited ones elsewhere on the a hard sell for political leaders facing their is another big trade-off: Big increases in defence spending will mean governments have less money to spend on public challenge for Europe is breathtaking. By comparison, Monday's symbolic EU-UK summit, may seem like a walk in the park.
The Guardian
13-02-2025
- Business
- The Guardian
The Guardian view on Britain's broken economy: ‘That's your bloody GDP, not ours'
The picture painted by official data for the UK economy in 2024 reveals a country broken by 14 years of Conservative party rule. True, the economy grew – somewhat unexpectedly – but GDP per head fell, showing prosperity didn't reach most people. There are a few reasons for this decline but none suggests a healthy society. One is runaway wealth inequality, with gains hoarded at the top. Another is stark regional disparities, with some areas falling further behind despite national GDP rising. A third is rising immigration without enough job creation – more workers, but not enough well-paying positions. A growing economy means little if it doesn't improve living standards. In 2024, it didn't. This political reality has shaped recent years, and not in a good way. It's worth recalling a Newcastle woman's tart response to the political scientist Anand Menon in 2016 when he warned that Brexit would hit GDP: 'That's your bloody GDP, not ours.' That continuing frustration explains the current backlash against mainstream politicians. No wonder Sir Keir Starmer wants his party to be one of disruption. Thursday's growth figures offer the prime minister a chance to break the mould of British politics. Unfortunately, he seems reluctant to act. What's clear from the statistics is that, in 2024, government spending drove growth – boosted by rising wages, especially in the public sector – rather than business investment or net trade. Labour could challenge the status quo with a new economic vision centred on the state. Instead, unfortunately, the government promotes the idea that growth depends on government inaction in the face of unfettered capitalism. Statistics often disguise the state's role, framing public services as just another economic input rather than the engine of demand they are. This distortion makes the economy look more market-driven than reality, reinforcing neoliberal myths. The chancellor, Rachel Reeves, unfortunately, seems more eager to conform to these narratives than challenge them. She plans to cut public sector net borrowing from March 2025 to meet fiscal rules – austerity by another name. The last time this happened, post-2010, it led to a decade of weak growth and stagnant wages. The justice secretary, Shabana Mahmood, gets it. This week, she called out austerity's role in wrecking probation services. If she was trying to change the chancellor's mind, she deserves thanks. Britain can't afford years of cuts. One of John Maynard Keynes' sharpest insights was what's good for society isn't always good for profits. That's why the Green Alliance, a thinktank, is right – injecting £3bn into discounting rail fares to boost passenger miles by 22% is smart economics. It's a win for regional growth, for the climate and for cleaner air. The state has the power to make capitalism work for the public – if it chooses to use it. But Labour's delay on releasing its industrial strategy is a worrying sign. The UK must move away from a debt-driven, low-wage, financialised economic model. Public investment in infrastructure – especially in underserved regions – and in skills and industry is needed to stimulate demand and create high-quality jobs. Raising wages and reducing inequality will ensure broad-based prosperity, not just asset bubbles. The belief that 'markets know best' has prevented bold action on Britain's yawning economic divides and the climate emergency. After 40 years of weakening the state and rewarding rentier capitalism, reform is urgent. Labour must build a system that delivers it.
