With the UK poised to boost public spending by £70 billion annually over the next five years, many observers anticipate that the nation’s economy will gather pace in 2025.
Prime Minister Keir Starmer must fulfil his election promise of delivering a stronger economy, say many economists, who argue that this will be key to winning over an electorate still adjusting to his government’s agenda.
Recent polling data indicates the ruling Labour party’s once-comfortable lead over the Conservative-led opposition has narrowed dramatically—down to just two percentage points, from the nine-point margin recorded at July’s general election.
Meanwhile, the government’s Office of Budget Responsibility forecasts that the UK economy will expand by 2 per cent in 2025, before moderating to 1.8 per cent in 2026 and 1.5 per cent in 2027.
This 2025 outlook is “slightly more optimistic” than most analysts believe.
Earlier this month, the Paris-based Organisation for Economic Co-operation and Development raised its own 2025 growth projection to 1.7 per cent, up from its previous estimate of 1.2 per cent, while also cutting its 2023 expectation to 0.9 per cent, down from 1.1 per cent.
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