This briefing note sets out how the Government can reset Britain’s economic policy following disastrous local election results, arguing that an honest assessment of where the country stands is the indispensable starting point for repairing its relationship with voters. The economic backdrop remains highly challenging with the conflict in the Middle East providing another unwanted headwind for growth. The growth outlook has deteriorated since the 2024 general election and lags well behind the US. Since the pandemic, median incomes have crawled up, while for many poorer families real income fell. Some household groups have fared better with pensioner incomes outperforming working-age families since the pandemic. Looking over a longer sweep of history, wealthier families have also fared better.