This week we witnessed the uncertainty of a changing world. Financial markets and nation states responding to the dawn of a new economic era and the reality of new barriers to trade. I am in no doubt that the imposition of tariffs will have a profound impact on the global economy and the economy at home.
This change can be unsettling for families who are worried about the cost of living and businesses concerned about what it means for them. But our task as a government is not to be knocked off course or to take rash action which risks undermining people’s security. Instead, we must rise to meet the moment and do what is right in Britain’s national interest.
That’s why we’re taking action. On Monday we announced plans to ease pressure on British car manufacturers by easing the EV mandate. On Wednesday we announced a brand-new theme park to be built in Bedfordshire – raking in £50bn for the economy. On Thursday the prime minister confirmed £30m to reopen Doncaster airport. And on Friday we saw growth tick up by 0.5% – the biggest rise since last June.
This is the plan for change in action – driving infrastructure projects that will lead to the growth we need to improve living standards for everyone.
For too long the global economy has not worked for working people. Industries have been allowed to decline or to disappear. The cost of living crisis has exposed our vulnerability to the actions of Vladimir Putin, who has used energy prices as a weapon of war. And economic mismanagement has left countries more exposed to global shocks.
Insecurity has become a virus plaguing our economies, with an endemic of low pay, poor working conditions and inactivity. And Britain has not been alone in this. That’s why our response must be guided by our national interest and security for working people.
Let’s start with stability. Economic stability is the precondition of growth. At a time of global uncertainty, businesses will rightly be looking to countries that can provide them with the confidence to invest and to grow. It’s why we took the decision at the autumn budget last year to fix the foundations of our economy and to put our public finances back on a firm footing after years of vandalism under the Conservatives.
Because with that stability comes security. It is not enough for the state to simply get out of the way and to leave markets to their own devices. Our economy is too exposed to global disruption and supply shocks, as recent events have shown. Instead, we need a strong, smart and agile state to support key industries and back those sectors of the economy particularly affected by tariffs. This isn’t about picking winners or losers. It is about using the power of government to back those sectors of the economy that can provide security for working people, whether that is in jobs or investment, and can compete in a global marketplace.
That is why the prime minister and I stepped in last week to back British car manufacturers to decarbonise in a way that is sustainable, helping the transition to electric vehicles and giving them greater flexibility to hit the 2030 target. It is why this Labour government acted in parliament to save British steel production for the future. And it’s why I am announcing a new package of support for thousands of British exporters that are set to be affected by tariffs by extending loans, guarantees and insurance to those companies facing significant short-term strain. The promise of security backed up by the actions necessary to deliver that security.
But we must double down on our plan for growth. People are impatient for change. I am impatient. We cannot afford to sit still. We must go further and faster, with every part of the state – from Whitehall to Cardiff, Edinburgh to Belfast, Manchester to Sheffield – working together in our collective endeavour. So, in the coming weeks, working with cabinet colleagues across government, we will bring forward action from our industrial strategy to support our economy and take down the barriers to growth.
I will be holding further talks with business leaders about how we will accelerate our plans. How we can demonstrate Britain’s place as a safe haven to live, invest and to do business. And how we can seize the opportunities that are ahead of us. Economic growth will be hardwired into the spending review too, with a laser focus on ensuring the investments we make now – whether that is in energy, transport or digital – deliver prosperity tomorrow.
And finally, there is Britain’s place in the world. The Labour party is an internationalist party. We understand the benefits of free and fair trade and collaboration. Now is not the time to turn our backs on the world but to face forward. The prime minister has shown that leadership when it comes to our country’s response to the war on Ukraine and the increase in defence spending. He has shown the calm and considered leadership that is needed at moments like this.
We continue to pursue the best possible deal with the US. At the same time, we will continue to pursue future trade agreements with other economies, including India, and secure an ambitious new relationship with the EU that deepens ties with our largest trading partners and delivers for Britain.
And later this month, I will travel to Washington for the IMF spring meetings, where I will make clear the UK’s support for institutions that underpin global economic stability. But I will also make the argument for a more balanced global economic and trading system that supports national economies to become more resilient. One that recognises the benefits of free and fair trade but also seeks to address the challenges of this new era.
I am under no illusion about the difficulties that lie ahead. Change can be unsettling. But, this is a government that is on your side and will continue to act in our national interest. We have a plan for change that is delivering on the promise of a better future. Security for working people and renewal for Britain. More pounds in people’s pockets. That is our promise and, together, that is what we will deliver.
