Jeremy Hunt has touted the UK as a destination for investment in artificial intelligence and praised the country's education system. Photo: Holly Adams/Reuters < p>Jeremy Hunt likened Britain's economic problems to a “sprained ankle” rather than a “broken leg”, saying those who criticized the country were constantly wrong.
The Chancellor acknowledged that since the 2008 financial crisis the UK had fallen into a “low growth paradigm” along with other major advanced economies, but insisted reforms announced in the Autumn Statement would help boost growth.
>< p>Speaking at a conference organized by the Resolution Foundation, Mr Hunt said the tax cuts announced in his Autumn Statement would help boost investment and rejected suggestions that the UK was “going to hell on a handcart”. >Responding to an audience member who said the Resolution Foundation had diagnosed the UK economy as having a “broken leg”, Mr Hunt said: “I think it's really important not to lose faith in yourself.”
“ If we're going to deal with a sprained ankle rather than a broken leg, let's do it from a positive perspective because we have so much going on.”
It comes as S&P Global warned the UK will perform worse than any other major economy next year as inflation remains higher than in Europe or the US.
S&P lowered its growth expectations for 2024 to 0.4%, which is 0.1 percentage points lower than the previous forecast. Even Germany is expected to outpace the UK next year as its manufacturing recession eases.
Mr Hunt said many forecasts from forecasters and commentators in the past had been too gloomy, including the government's own independent forecaster.< /p>
The Chancellor said: “We must not lose sight of the fact that despite many respected magazines saying we are going to hell on a handcart, we always fail to meet expectations in this country and we do far better than everyone says ” /p>
“A year ago, all these experts said that the economy would shrink. The Office for Budget Responsibility (OBR) said it would cut by 1.4%. In fact, growth [is projected] to be 0.6%. That's a 2% difference in just one year.”
Mr Hunt said entrepreneurs including Elon Musk praised Britain's status as a hub for investment in artificial intelligence, and the UK's education system was also the envy of the world.
The Chancellor made it clear he was committed to increase public investment if the economy improves further. He said: “I don't think you want disinvestment and I hope we get to the point where we don't have that.”
It comes after Labor leader Sir Keir Starmer said he would do so. rather than “open the spending taps” if he wins the next election.
Speaking at the same conference as Mr Hunt, Dame Sharon White, chief executive of John Lewis, called on politicians to treat Britain's stagnant economy as a “national emergency” and called for cross-party agreement on policies to revive the economy.
Andy Haldane, the former chief economist at the Bank of England, warned that the Treasury in its current form was not fit for purpose and called on politicians to dismantle the department. He said a new Department for the Economy, headquartered in Darlington, would need to be created, tasked with stimulating economic growth.
He said the Treasury's focus on balancing tax and spending “has damaged UK growth policy for many years decades” because “Treasury fiscal priorities” always take precedence over any agenda promoting economic growth.
Speaking on a separate panel, Mr Hunt spoke out against the idea. He said: “The problem is that in any political system, ultimately power is where the money is. And you don't want the department responsible for economic growth to have to negotiate its budget with the Treasury every year.”
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