The Bank of England's Monetary Policy Committee recently issued its latest quarterly report on its forecast for future inflation and economic data.  It was a grim read on inflation, on economic growth, and on unemployment. 

The Bank of England predicts that inflation, currently running at 2.5%, will rise to 3.7% in the first half of this year, with it being 2028 before it falls back to below its 2% target.  Higher energy and water bills were quoted as being a big factor. Let’s not forget that a key campaign pledge from Labour in last year’s general election was to reduce energy bills by £300 a year. 

So far we’ve seen a 10% rise last October and then a further 1.2% rise in January in the price cap.  The forecasts for April when the next price cap is applied, range from between a 3% and 5% further increase.  It feels like Ed Miliband’s Net Zero is more about our bank account balances than carbon emissions!   

While they have quietly dropped their £300 reduction in our energy bills and having already taken people for mugs, the Labour Government have consistently said that ‘growth is their main mission’.  Indeed, the day before the Bank of England’s report, Labour MPs across the country were posting graphics on their social media claiming the UK would have the highest economic growth in Europe.  Unfortunately for their credibility, the report the next day delivered the crushing blow, that the Bank were halving their forecast for 2025’s economic growth from 1.5% to just 0.75%.  

The Bank stated that business and consumer confidence have declined, and that productivity growth has become weaker.  The forecasts for unemployment showed a continued increase through to 2028.  The good news (for some) was that there was a 0.25% interest rate reduction, which helps people on tracker mortgages.  However, it’s not good news for savers, especially pensioners, many of whom use modest savings interest to supplement their pension.

It's bad news for everyone that Labour are failing on the economy.  Ultimately, their NI rises and overtaxing of businesses are having consequences for us all. 


 

Councillor Duncan Crow, Leader of Crawley Borough Council Conservative Group

12th February 2025