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Reynolds column: Economy can't afford anything less

Stalybridge and Hyde MP Jonathan Reynolds believes the performance of the economy is the major issue facing the country, as he writes in his latest column.

The UK has some world-leading businesses. In some sectors, such as aerospace, financial services and the creative industries, we can genuinely say we have firms that are the envy of the world. That’s why, when I look at how the UK’s economy has done over the last decade, I am so frustrated.

Economic growth might sound abstract to some people but it is the entire basis upon which living standards, public services, and our national security depends.

For nearly 200 years the British economy has tended to grow at around 2-2.5 per cent a year. This might sound modest, but because of compound- ing two per cent growth means our economy has doubled in size every 35 years. From the expansion of education to the creation of the NHS, these things have been possible because of the growth of the British economy.

Unfortunately, over the last decade we’ve done far worse than this. And the forecast for the future is even worse – showing the UK is set to grow the slowest of any major nation, except for Russia. This is simply not good enough.

The UK is a society which is getting older. We should celebrate this. That people are living longer is testament to institutions like the NHS and higher living standards and we should all be proud of that. But as public pensions are paid directly from current tax revenues, an economy that isn’t performing well makes it harder to provide these at the level people deserve.

The performance of the economy is, in my view, the major issue facing us. This week I was in Liverpool with Keir Starmer setting out some ideas to do exactly that. It will take action on my fronts.

Firstly, increased public investment in reaching net zero to leverage in the huge sums of private capital we need to meet our climate change objectives.

Secondly, reform in areas that actively disincentivise investment and innovation, starting with business rates.

Thirdly, better employment rights so that growth doesn’t come at the cost of greater workplace insecurity and exploitation.

Fourthly, the establishment of a proper industrial strategy, so that businesses can invest in confidence for the long-term. Currently the UK has the lowest rate of business investment in the G7.

Fifthly, greater devolution. What we need here in Tameside and Greater Manchester might be different to other parts of the UK, and some national budgets. Getting this right will require a decisive break from the policies of the last decade. But frankly we can’t afford anything else.

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