UK economy growth revealed as Labour told ‘you don’t have a plan’ | Personal Finance | Finance

The UK economy grew by 0.3% in November, the Office for National Statistics said on Thursday. The improvement came on the same month as households and businesses were gearing up to Rachel Reeves’ Autumn Budget. In the run-up to the delivery of the Budget, reports suggested the UK had to prepare for tax hikes and difficult decisions. 

The ONS reported an improvement for industrial production in October, as Jaguar Land Rover (JLR) factories were restarting production following a cyber attack in August. Official figures also showed the UK economy grew in September, with a 0.1% rise, after previous estimates of a 0.1% fall were revised on the back of more data, particularly from the pharmaceutical sector. November’s economic growth was supported by a 25.5% jump in the motor manufacturing industry as it continued to bounce back following a sharp fall in activity in September after JLR’s factory shutdown.

ONS director of economic statistics Liz McKeown said: “The economy grew slightly in the latest three months, led by growth in the services sector, which performed better in November following a weak October. This was partially offset by a fall in manufacturing, where three-monthly growth was still affected by the cyber incident that impacted car production earlier in the autumn.

“However, data for the latest month show that this industry has now largely recovered. Construction contracted again, registering its largest three-monthly fall in nearly three years.”

In response to confirmation of economic growth in November, a Treasury spokesperson said: “To make the economy work for working people, we are reversing years of underinvestment by protecting record infrastructure investment, driving through major planning reform, backing expansion at Heathrow and Gatwick, delivering Northern Powerhouse Rail and getting Sizewell C built.

“At the same time, we are taking action to get bills and inflation down – with £150 off energy bills, rail fares, prescription charges and fuel duty all frozen, the two-child benefit cap lifted, alongside the national living wage to deliver an economy that works for working people.

“There’s more to do – driving growth, delivering the consolidation to provide stability, keeping inflation low and stable, tackling the cost of living and bringing our borrowing costs down.”

Construction has faced a difficult period for over a year, and the housebuilding sector has borne the brunt of the downturn.

Craig Fish, Director at Lodestone Mortgages, said the UK economy is struggling despite technically expanding. He added: “On paper, the UK economy has technically grown but for households and businesses, it doesn’t feel like it. These GDP figures are tweaked and revised almost every month, which does little to build public confidence, much like the constant policy U-turns we’ve seen from the government in recent weeks.

“A 0.1% rise over three months is hardly a sign of a strong or growing economy, especially when construction output is falling sharply and manufacturing remains under pressure. For many people, costs are still high, confidence is fragile and day-to-day finances remain stretched.

“From a mortgage and rates perspective, this kind of weak, uneven growth supports the case for interest rates to fall gradually rather than stay higher for longer.

“But it also underlines why borrowers shouldn’t expect dramatic cuts overnight. The economy is bumping along, not booming and mortgage rates are likely to reflect that cautious reality rather than the headline figures alone.”

The Conservative Party said the latest figures are “more evidence of Labour’s economic mismanagement”.

Shadow chancellor Sir Mel Stride said: “This morning’s news that growth is flat-lining is more evidence of Labour’s economic mismanagement.

“Growth was just 0.1% in the three months to November, having not grown at all in the previous three-month period.

“Because Labour made the wrong choices, their budget is unravelling day by day. Despite Labour’s U-turns on the family farms tax and business rates, their budget will still leave working people worse off and our economy weaker, with higher taxes stifling growth and fuelling inflation.

“With every U-turn, the Chancellor loses more credibility and Labour show they do not have a plan. Only the Conservatives have a leader with a backbone, a strong team and a clear plan to build a stronger economy, and get Britain working again.”