Growth slips, wages stall

THE UK economy grew by 0.3 per cent in the first quarter of the year, a mere 0.1 per cent less than forecast but the lowest in the past year — and grist to the mill of the Government’s critics. In London, the Institute for Fiscal Studies suggests that workers are especially affected by stagnant wages. This would be less of a problem were inflation not also rising, to 2.3 per cent — not a dramatic figure, but the combination of rising prices and sluggish wages inevitably affects consumer confidence.

In normal circumstances, this would be bad news for a government just entering an election campaign, but what matters is not just the Government’s credibility but that of the Opposition. And right now the credibility of Labour on the economy is dismal, with its expansive spending commitments on health, schools and housing unmatched by specifics about funding. These trends are troubling, especially in the context of the robust approach to Brexit outlined by the rest of the EU yesterday, but right now, the Tories are getting a rather easy ride on the economy