Published : 3 days ago, on 05/12/2024

LONDON (Reuters) – British Prime Minister Keir Starmer said on Thursday that he had not watered down the his ambition for Britain to become the fastest growing economy in the Group of Seven, as he set out ways to measure the government’s progress.

The government will now “aim” for the fastest economic growth per capita in the Group of Seven advanced economies, according to a document setting out Starmer’s plans. It had previously been described as a “goal”.

Britain’s government had previously pledged to deliver the fastest growth in per-capita GDP in the G7 for two years running by the end of the parliament – something that has never happened according to OECD records that date back to the 1970s.

Starmer told reporters that he had not watered down the government’s growth target and said the priority was to make people better off.

“Growth is fundamentally important, it remains the mission, we’ve doubled down on it, but growth in the abstract doesn’t feel the same, doesn’t mean the same thing, as people feeling they’re better off,” he said.

Starmer also promised to deliver higher living standards across every region of the United Kingdom by the end of the parliament.

Household disposable income, adjusted for inflation, rose on average by just 0.3% per year between 2019 and 2024, marking the worst parliamentary term for living standards since records began in the 1950s, according to the Institute for Fiscal Studies, a think tank.

The Office for Budget Responsibility, whose forecasts underpin the government’s budgets, predicts only a small improvement during the current parliamentary term, which looks on track to be the second-worst in terms for growth in disposable income.

Labour won a sweeping majority in July, taking power for the first time in 14 years, but has fallen behind the opposition Conservative Party in some opinion polls.

(Reporting by Alistair Smout, Muvija M and Andy Bruce; Writing by Catarina Demony and Andy Bruce; Editing by William Schomberg and Alison Williams)