I’ve finally realised who Jeremy Hunt reminds me of – Arsène Wenger. During his later, less successful period at the club, the then-Arsenal manager would often comment after matches how his team dropped a little bit physically in the second half but showed top mental strength.
The chancellor has his own version of this motif. The economic data comes in, and no matter how disappointing, Hunt informs Geoff Shreeves (or perhaps Faisal Islam) that the outlook is better than expected and points out the UK is set to avoid recession. Both are technically true, but better than expected is different from good.
The British economy is stuck. Growth flatlined in February, the latest figures from the Office for National Statistics show, as a rise in construction was offset by falls in the dominant services sector. This would be bad enough if inflation weren’t still romping along at double digits.
It is dangerous to read too much into a single month’s data. February was hampered by widespread industrial action, with one day marking the biggest set of strikes in a decade as teachers, rail workers, civil servants and others walked out in multiple disputes over pay and conditions.
But today’s data chimes with the IMF, who earlier this week forecast that the UK economy would contract by 0.3 per cent this year, making it the worst-performing economy in the G20, which includes sanctions-hit Russia.
Thanks to revised figures from previous months, the UK economy has at least finally exceeded its pre-pandemic level by 0.3 per cent. But hold the ticker-tape parade. The US economy is more than 5 per cent larger than its 2019 level, while the Eurozone was 2.4 per cent bigger at the end of last year. Britain is lagging.
These figures translate into the catastrophe that is real-terms pay. Average real household disposable income fell by 3.3 per cent in 2022, equating to £800 per household, according to the Resolution Foundation. This represents the biggest annual fall in a century.
And it comes off a terrible decade and a half for wages. Real average weekly earnings would be roughly £11,000 a per year higher had the pre-global financial crisis trend rate continued. £11,000!
The government’s plan is clear. Hope inflation falls, keep something in reserve for election year tax cuts, delay said election until the last possible moment and cross its fingers. Unfortunately, hope is not a strategy, and ‘better than it might have been’ has historically received short shrift from voters.
Elsewhere in the paper, Transport for London has removed wraparound adverts on London buses, following claims that it was misleading. The graphic stated that all of London’s buses are either “low or zero-emission at the tailpipe”, with the words “zero-emission” used in a significantly larger font. According to TfL’s website, around 800 of the city’s 9,000 buses are zero-emission.
In the comment pages, Ben Judah warns how Britain could easily be pulled into war with China over Taiwan. Nancy Durrant calls the latest English National Opera agreement a face-saving fool’s game. While Sarfraz Manzoor despairs at the outrageously high ticket prices and rip-off resales killing live music.
And finally, for something completely different, check out our pick of the best images of the day from the Standard’s picture desk.
