It’s time for change to revive struggling economy

IT’S Budget week - likely to be the last major fiscal event before the General Election, the Budget offers the Government a final chance to turn things around before they face the polls.

After 14 years of Conservative rule during which wages and living standards have fallen, the economy has stagnated and public services have been cut to the bone, it is undoubtedly time for meaningful change.

New analysis by the TUC shows that UK households have cut spending by £700 a year, on average, since Covid struck. This is a fall of 1.4% and the equivalent of £20bn annually. This is bad for households and bad for our economy. Lower spending is depressing growth and starving our public services of muchneeded revenues. And this can’t be excused as a global trend. Of the 37 OECD nations, only two others experienced a bigger fall than the UK. We are the only G7 economy where disposable income hasn’t recovered to its pre-pandemic levels and the only country currently in recession.

Had spending risen in line with the OECD average, UK households would be spending nearly £3,000 a year more than before the pandemic, and the UK economy would now be at least £84bn a year bigger. Both America and Canda have seen decent growth in their economies since the pandemic, proving that it is possible right now.

Yet the UK is constantly falling and shrinking and declining when it could and should be growing. This isn’t just about figures, league tables and leaders, it’s about the lives of ordinary working people.

Family budgets have been shredded by the last 14 years of stagnating living standards, real wages in the UK are still worth less than in 2008 and personal debt is increasing. While families in other countries have seen their disposable incomes rise, many here in the North East are struggling to cover even the basics.

This is not a glowing reference for conservative fiscal policy. If anything, it’s damning. The Government’s failure to deliver growth since the pandemic and years of economic stagnation is crippling the country.

Families should be becoming better off, not worse.

It’s time for a serious long-term economic plan, not sticking-plaster policies. That means a proper industrial strategy and investment in public services and green infrastructure.

That’s the best way to revive our economy, improve the living standards of millions of working people and sustain growth into the future.