Productivity & industrial strategy· Economic growth Yanked away Accounting for the post-pandemic productivity divergence between Britain and America 8 April 2025 by Simon Pittaway Britain’s record of productivity growth in the 2010s was dismal. But halfway through the 2020s things appear to have got worse not better, with official data likely understating the scale of Britain’s ongoing productivity crisis. America has been on a different track so far this decade. It is the only G7 economy where productivity growth … Continued READ MORE
Living standards· Budgets & fiscal events· Welfare Unsung Britain bears the brunt Putting the 2025 Spring Statement in context 27 March 2025 by Camron Aref-Adib and Mike Brewer and Molly Broome and Alex Clegg and Nye Cominetti and Adam Corlett and Ruth Curtice and Emily Fry and Zachary Leather and Jonathan Marshall and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Imogen Stone and Greg Thwaites and Lalitha Try This briefing note analyses the choices the Government has made in the context of an awkward backdrop to the 2025 Spring Statement. READ MORE
Budgets & fiscal events· Economy and public finances The headroom bind Spring Statement 2025 preview 17 March 2025 by James Smith and Adam Corlett and Emily Fry and Louise Murphy and Cara Pacitti and Simon Pittaway and Greg Thwaites and Lalitha Try In this slide pack we preview the upcoming Spring Statement, assessing the economic and fiscal outlook ahead of this key economic-policy event. We focus on the news since the Autumn Budget and the implications of different policy choices, putting the Chancellor’s upcoming decisions in a broader context. READ MORE
Macroeconomic policy The Macroeconomic Policy Outlook Q1 2025 30 January 2025 by Simon Pittaway and James Smith It has been a bleak winter for the Government’s hopes that the economy might turn a corner. Markets have been volatile, with the cost of government borrowing rising to its highest level since July 2008 with the pound falling sharply. And there are signs that growth has hit a brick wall, with GDP flat in … Continued READ MORE
Wealth & assets What’s up? Five key takeaways from new data on household wealth on the eve of the cost of living crisis 24 January 2025 by Molly Broome and Simon Pittaway Today’s release of long-awaited data from the Wealth and Assets Survey (WAS) allows us to finally shed more light on family finances during the Covid-19 pandemic. It shows that total household wealth continued to grow faster than the size of the economy – a trend dating back to the mid-1980s. Total household wealth reached a … Continued READ MORE
Living standards· Prices & consumption Whose price is it anyway? Comparing the spending power of low-to-middle income families in Britain and abroad 13 January 2025 by Zaynah Janan and Simon Pittaway A long-standing finding is that British households on low-to-middle incomes are poorer than their counterparts in many advanced economies.[1] This result comes from comparing the incomes of this group to price levels in their respective countries. But these price measures typically reflect the spending of all families, not just those on low-to-middle incomes. In this … Continued READ MORE
Living standards Public pivot How a growing state will shape the living standards outlook for 2025 7 January 2025 by Alex Clegg and Adam Corlett and Louise Murphy and Simon Pittaway and Imogen Stone and Greg Thwaites 2025 will be a year with a bigger role for the state. Jeremy Hunt cut taxes in his last two Budgets and planned to pay for them with real-terms cuts to public spending in many areas. Rachel Reeves’s October Budget reversed these plans, pivoting to increasing spending on public services as a share of the … Continued READ MORE
Aiming high? Assessing the Government’s new targets for its growth mission 5 December 2024 by Adam Corlett and Simon Pittaway and James Smith In government, priorities matter. And today the Government underscored its key priorities, announcing six ‘milestones’ for its six missions. When it comes to its mission for growth, there has been a welcome shift in focus towards living standards. Alongside growing GDP per capita, the Government has also committed to raising real household disposable income (RHDI) per person over the course of this Parliament. The inclusion of this measure of income should focus minds in Whitehall on ensuring growth that delivers higher income and, ultimately, better living standards for families. READ MORE
Wealth & assets Inequality control Why wealth inequality has not increased while asset prices have soared and what that means for the future 28 November 2024 by Simon Pittaway The turbulent 2020s have had profound implications for household wealth in Britain: lockdowns pushed saving to unprecedented highs, asset prices surged and then tanked, and high inflation eroded the real value of wealth. This recent turbulence came on the back of decades of rising wealth. But, unlike elsewhere, relative wealth inequality in Britain did not soar during the era of rapidly rising wealth. This report discusses what lies behind this puzzling stability, which is key to understanding the reality of wealth inequality in Britain today and how it might evolve in future. READ MORE
Budgets & fiscal events· Public spending· Economy and public finances· Tax More, more, more Putting the Autumn Budget 2024 decisions on tax, spending and borrowing into context 31 October 2024 by Camron Aref-Adib and Mike Brewer and Molly Broome and Tom Clark and Alex Clegg and Nye Cominetti and Adam Corlett and Emily Fry and Sophie Hale and Lindsay Judge and Zachary Leather and Jonathan Marshall and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Greg Thwaites and Lalitha Try This has been the most anticipated Budget of modern times. It had to wrestle with profound – and sometimes conflicting – challenges: fixing the strained public services; repairing failing public services; and breaking with the UK’s dire record on public investment. And all of this had to be squared with pre-election pledges not to raise … Continued READ MORE
Wealth & assets Wealth check What the new Government needs to know about household wealth as it navigates the challenges ahead 28 July 2024 by Simon Pittaway British household wealth has been on a rollercoaster ride in recent years. In Q1 2024, it was estimated to be worth more than six times GDP (630 per cent), more than 50 per cent higher than the last time Labour came into power (410 per cent in 1997). The key driver of this huge rise … Continued READ MORE
General Election 2024· Tax· Welfare· Political parties and elections Growing for gold? Analysing the tax and spend package of the 2024 Labour Manifesto 14 June 2024 by Molly Broome and Nye Cominetti and Emily Fry and Tara Goatley and Charlie McCurdy and Simon Pittaway and Hannah Slaughter and James Smith and Lalitha Try In launching its manifesto, the Labour Party put the emphasis on efforts to boost growth. But more eye-catching were promises of some of the biggest changes to the labour market in a generation, with the aim of improving the quality of work. Proposals here included new employment rights, tougher labour-market enforcement, and an innovative approach … Continued READ MORE
General Election 2024· Tax· Welfare· Political parties and elections The narrow path to NICs cuts Analysing the tax and spend package of the 2024 Conservative Manifesto 12 June 2024 by Camron Aref-Adib and Emma Beale and Molly Broome and Lindsay Judge and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Simon Pittaway and James Smith and Lalitha Try The launch of the Conservative manifesto is a big moment in this election campaign. The strategy here was clear: treble down on National Insurance (NI) rate cuts. The continued focus on NI is welcome, at least compared to the alternatives, and delivers significant cuts in tax for some, with the proposed 2p reduction delivering a … Continued READ MORE
General Election 2024· Brexit & trade· Economic growth Life in the slow lane Assessing the UK’s economic and trade performance since 2010 9 June 2024 by Emily Fry and Simon Pittaway and Greg Thwaites This briefing note is the third output in a programme of outputs designed to put the upcoming UK general election in context, supported by the Nuffield Foundation. It looks at the performance of the UK economy and trade since 2010. The UK grew faster than other G7 economies in the first quarter of 2024 but, … Continued READ MORE
Prices & consumption Paying the price How the inflation surge has reshaped the British economy 17 May 2024 by Nye Cominetti and Ian Mulheirn and Cara Pacitti and Simon Pittaway and James Smith The UK has experienced its highest inflation for more than 40 years, following Russia’s invasion of Ukraine. But next week will bring the welcome news that inflation has returned close to the 2 per cent target for the first time since July 2021. In this briefing note we take a step back and look at … Continued READ MORE
Budgets & fiscal events· Public spending· Economy and public finances· Tax Back for more? Putting the 2024 Spring Budget in context 7 March 2024 by Camron Aref-Adib and Torsten Bell and Mike Brewer and Molly Broome and Alex Clegg and Nye Cominetti and Adam Corlett and Emily Fry and Jonathan Marshall and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Greg Thwaites and Lalitha Try In this briefing note, we put the decisions in the Spring Budget 2024 in context, discussing how the economic outlook has changed, what that means for the public finances, and how the policy decisions taken at the Budget will affect living standards in both the short and the medium term. READ MORE
Household debt· Wealth & assets In too deep? The impact of the cost of living crisis on household debt 29 February 2024 by Felicia Odamtten and Simon Pittaway Hard economic times and rising interest rates have brought a renewed focus on household debt in recent years, with concerns that more and more families could find themselves overwhelmed by the burden of debt. So this briefing note takes a closer look at the use of consumer debt (such as credit cards, personal loans and … Continued READ MORE
Pensions & savings· Wealth & assets Precautionary tales Tackling the problem of low saving among UK households 12 February 2024 by Molly Broome and Ian Mulheirn and Simon Pittaway Families in Britain are confronted with what can be termed a ‘triple savings challenge’. This encompasses a lack of accessible ‘rainy day’ savings to cushion small cashflow shocks, inadequate precautionary saving to see people through large and unexpected income shocks, and insufficient saving to provide an adequate income in retirement. These three savings challenges are … Continued READ MORE
Macroeconomic policy The Macroeconomic Policy Outlook Q1 2024 5 January 2024 by Simon Pittaway 2023 was yet another year of economic stagnation for the UK. By the third quarter of the year, economic activity was only 0.2 per cent higher than at the end of 2022. But forecasts this time last year were far gloomier than the year of stagnation that came to pass. One reason why the UK … Continued READ MORE
Budgets & fiscal events· Economy and public finances A pre-election Statement Putting the Autumn Statement 2023 in context 23 November 2023 by Camron Aref-Adib and Torsten Bell and Mike Brewer and Molly Broome and Alex Clegg and Nye Cominetti and Adam Corlett and Sophie Hale and Lindsay Judge and Jonathan Marshall and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Greg Thwaites and Lalitha Try In this briefing note, we put the decisions in the 2023 Autumn Statement in context, discussing how the economic outlook has changed, what that means for the public finances, and how the policy decisions taken will affect living standards in both the short and the medium term. READ MORE
Budgets & fiscal events· Economy and public finances Preparing the pitch Autumn Statement 2023 preview 6 November 2023 by Adam Corlett and Jonathan Marshall and Charlie McCurdy and Louise Murphy and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Greg Thwaites In our Autumn Statement preview slidepack, we assess the economic outlook ahead of Jeremy Hunt’s Autumn Statement on November 22nd, and explore the policy choices facing the Chancellor as inflation drives up tax revenues, and interest rates drive up the cost of government debt. We find that the Chancellor is in difficult terrain: although the … Continued READ MORE
A wealth of variety The variation in household wealth across Britain and what it means for policy 30 October 2023 by Molly Broome and Ian Mulheirn and Simon Pittaway In this briefing note we explore how wealth was distributed across the nations and regions of Britain on the eve of the pandemic, what determined those differences, and how wealth has evolved in different places since the recent rise in interest rates began. We also explore the policy implications, in particular how Council Tax as … Continued READ MORE
Economy 2030 Built to last Towards a sustainable macroeconomic policy framework for the UK 19 October 2023 by Simon Pittaway and James Smith This paper, part of the Economy 2030 Inquiry, tackles the key question of how to futureproof the UK’s macroeconomic policy framework. Looking beyond the immediate policy challenge of high inflation, it focuses on whether the current framework – largely set during the calmer economic times of the 1990s – is still fit for purpose. Since … Continued READ MORE
Macroeconomic policy Macroeconomic Policy Outlook: Q3 2023 5 October 2023 by Simon Pittaway and James Smith and Greg Thwaites In this edition of the MPO we focus on the scale and nature of the UK’s inflation challenge, looking at what we can learn from comparisons with other countries, and what that means for monetary policy. A key reason to worry about UK inflation is that it looks exceptional: it is the highest headline inflation … Continued READ MORE
Wealth & assets Peaked Interest? What higher interest rates mean for the size and distribution of Britain's household wealth 17 July 2023 by Molly Broome and Ian Mulheirn and Simon Pittaway Over the past four decades, the total value of wealth owned by UK households has been on a seemingly-relentless upward path: rising from around three-times GDP in the mid 1980s to almost eight-times. The key driver of this rise in wealth has been falling interest rates and the associated increase in asset prices. But the … Continued READ MORE
