THE UK economy is “going gangbusters” after coming out of recession with the fastest growth in two years, experts said last night.
Rishi Sunak claimed vindication after GDP grew 0.6 per cent in the first three months of 2024, in defiance of gloomier predictions.
It meant the UK outperformed France, Germany and the US to swing out of a brief and shallow recession.
Grant Fitzner, of the Office for National Statistics, said: “You could say the economy is going gangbusters.”
It marked the strongest quarterly growth since late 2021, in the post-pandemic recovery.
It has been largely driven by robust services output and a manufacturing bounceback.
The PM hailed the stats as proof his plan to grow the economy while taming inflation was working.
Chancellor Jeremy Hunt also pointed out how the Bank of England credited his £900 average National Insurancetax cut for spurring growth.
But Labour accused the Tories of doing a “victory lap” despite millions still struggling.
Shadow Chancellor Rachel Reeves said: “The economy is still £300 smaller per person than when Rishi Sunak became Prime Minister.”
And the Institute for Economic Affairs said 0.6 per cent growth was “little to get excited about”.
In a further boost, London’s FTSE 100 index hit a record high yesterday, at 8,433.76 points.
Future is bright
By Rishi Sunak, Prime Minister
I KNOW that the last few years have been really tough.
The economic shocks of Covid and Ukraine have had a chilling effect on everyone.
But now, at last, the economic clouds have started to part, and the sun is breaking through.
The numbers don’t lie. It was confirmed yesterday that the economy is returning to full strength.
We’re seeing the fastest growth for two years – the joint highest in the G7.
We’ve got inflation down from over 11% to just over 3%. Mortgage rates are down from their peak.
Food prices are coming down. And we’ve seen wages growing in real terms for nine months in a row.
The numbers on business investment don’t lie either.
In the last week alone we’ve seen investments worth over £2 billion into our brilliant life sciences and tech sectors – including the largest AI funding deal ever seen across the whole of Europe.
This follows major investments from the likes of Google, Microsoft, Nissan and Tata Group.
It’s a huge vote of confidence in the UK.
None of this has happened by accident.
It’s due to the difficult decisions we’ve been taking week in, week out – being disciplined on spending and borrowing, and creating an environment where businesses can thrive.
Now I want to see all of this making a real difference in people’s lives.
I’m determined to make sure that the British people feel the full benefits of a stronger economy.
That’s why we’ve already taken big steps to cut your taxes.
We’ve cut the National Insurance tax by a third and Sun readers should already be seeing this in their pay packet.
It’s worth £900 a year for someone on the average salary.
The Bank of England expect this to boost growth further still.
Our long-term plan is to keep cutting the National Insurance tax until it’s gone completely.
After a tough spell, we have turned a corner. We can look ahead with optimism.