Higher spending has left government borrowing £3.2 billion higher than the OBR’s last forecast three months into the new financial year, highlighting the scale of the fiscal challenge facing the new Chancellor ahead of her first Budget this Autumn, the Resolution Foundation said today (Friday). The latest ONS data showed that borrowing was £14.5 billion … Continued

Real wages are growing at their fastest rate outside of the pandemic in over a decade. This is welcome news for workers, but less so for monetary policy makers looking for signs of inflationary pressures, the Resolution Foundation said today (Thursday). The latest ONS labour market statistics show that wage growth has been resilient amid … Continued

Commenting on the Climate Change Committee’s latest UK Progress Report, Jonny Marshall, Senior Economist at the Resolution Foundation, said: “As well as setting out why the new government needs to be massively ramp up progress on net zero, this report sets out clear priorities on how to do this. “Lowering the cost of electricity will … Continued

 Boosting economic growth rightly lies at the heart of the new Government’s legislative agenda, with at least a dozen of the 40 Bills announced in the King’s Speech centred around that welcome objective. But bold ambition must be matched with careful implementation if the Government is to deliver its economic reform agenda successfully, the Resolution … Continued

CPI inflation remained at 2 per cent in the 12 months to June 2024 – but there were some worrying indications that key measures of domestic inflation remained stubbornly high, denting hopes that the Bank of England might cut interest rates in the near term, the Resolution Foundation said today (Wednesday). This steady rate of … Continued

Around 38 per cent of all large families (with at least three children) were affected by the two-child limit on benefit support in April 2024, and the policy is set to push the majority of large families below the poverty line by the end of the parliament, the Resolution Foundation said today (Thursday) in response … Continued

Real per capita household disposable incomes were lower in early 2024 than they were back in late 2019, with growth so far in this parliament weaker than all but two parliaments since 1910, the Resolution Foundation said today (Friday) in response to the latest ONS National Accounts data. The Foundation notes that real per capita … Continued

Repeated economic shocks and sluggish growth in between has resulted in typical real non-pensioner household disposable incomes growing by 0.5 per cent a year on average – or just £140 a year – in the 14 years since 2010, with poorer households experiencing stronger income growth than richer families over this period, according to new … Continued

The labour market backdrop to the election is a prolonged pay squeeze that has left real average wages today just £16 a week higher than in 2010, a job market struggling to recreate the 2010s boom, and the main parties taking very different approach to the world of work, according to new Resolution Foundation research … Continued

Addressing rising incapacity and disability benefit spending will be a key task for whoever wins the next election. But with the increase driven by Britain ageing, becoming less healthy and experiencing more disability, politicians will need to focus on the underlying causes of a rising caseload, not just on restricting the eligibility and generosity of … Continued

CPI inflation has fallen back to the Bank of England’s target of 2 per cent for the first time since July 2021 – a welcome return to normality – but worries about the legacy of high prices and stubborn underlying inflation remain, the Resolution Foundation said today (Wednesday). The biggest downward contribution to the fall … Continued

A welcome new political consensus is emerging on housing, with the Conservative and Labour manifestos both combining support for first-time buyers with stretching housebuilding targets. But the lack of cash for affordable housing will make these targets hard to hit, according to new Resolution Foundation research published today (Wednesday). Home truths – the latest Resolution … Continued

The Labour Party is proposing the biggest shake-up of the workplace in a generation, with the laudable aim of boosting the quality of work, which will demand careful consultation and implementation given the scale of change proposed. This boldness contrasts with a politically cautious approach to the public finances, which means a future Labour Chancellor … Continued

Welfare spending is set to increase by over £20 billion a year by the end of the next parliament, driven almost entirely by rising spending on pensioners and those with a health condition. But reductions in support for renters will increase the risk of homelessness, while limits and caps on support is set to push … Continued

The latest GDP data serves a reminder to whoever wins the next election that their central goal must be to end Britain’s economic stagnation, the Resolution Foundation said today (Wednesday). The economy did not grow in April, halting the momentum of 0.6 per cent growth in Q1 2024. Growth in the services sector slowed to … Continued

Tax changes pledged in the Conservative Party manifesto today (Tuesday) would mean a typical employee seeing their personal tax bill fall by £170 in 2028-29. But these pledges rely on making £12 billion of welfare cuts that recent history suggests will not be achievable over the next Parliament. This, along with £21 billion of cuts … Continued

The UK labour market continues to cool, with the employment rate only just above its mid-pandemic low point, suggesting that kickstarting jobs growth will be a major task for the next government, the Resolution Foundation said today (Tuesday) in response to the latest ONS labour market statistics. The latest data showed widespread signs of cooling, … Continued

The UK’s middle-of-the-pack record on economic growth since 2010 has been flattered by the population growing by six million people. But Britain will need to turnaround its dire productivity record and leverage its services strengths if it wants raise growth and boost living standards in the 2020s, according to new research published today (Sunday) by … Continued

While the main parties trade blows over possible secret tax bombshells, far bigger tax rises are hiding in plain sight, with £23 billion a year of post-election tax rises – equivalent to around £800 per household – having already been announced, and neither party committed to reversing them, according to new research published today (Saturday) … Continued

The narrow focus of the election campaign on relatively small spending pledges by the main political parties risks missing bigger economic uncertainties that the next government may need to confront, including a possible £12 billion black hole in the public finances from a productivity downgrade, higher market interest rates and infected-blood compensation, according to new … Continued

Summer energy bills will fall to their lowest level since the beginning of 2022 as a result of the latest Ofgem price cap for July to September 2024 falling to £1,568. But the legacy of a 60 per cent rise in average energy bills in 2024 compared with three years ago still casts a long … Continued

CPI inflation has returned to ‘normal’ levels, falling to 2.3 per cent in April 2024 – down from 3.2 per cent in March, and the closest to the Bank of England’s target of 2 per cent since July 2021 – raising hopes this is the end of the UK’s inflation surge, but services inflation remains … Continued

Official data next Wednesday looks set to show inflation returning to close to the two per cent target, drawing a line under a three-year inflation spike that has left British households spending less and saving more, according to new Resolution Foundation research published today (Friday). With CPI inflation for April set to fall within touching … Continued

The UK’s economic slowdown last year has caused Britain’s jobs recovery to falter, with its post-pandemic workforce shrinking by the equivalent by the equivalent of one million workers. But this hasn’t yet fed through into pay packets, with real wages growing at their fastest in rate in over two years, the Resolution Foundation said today … Continued

Falling pension costs and import prices have temporarily severed the link between productivity and wage growth in the UK, allowing real wages to rise without putting further pressure on inflation. But this ‘unproductive wage growth’ won’t last, according to new research published today (Monday) by the Resolution Foundation. The Foundation’s latest Macroeconomic Policy Outlook examines … Continued