World Economic Outlook: UK Growth and Inflation

Lord Hintze Excerpts

Wednesday 22nd April 2026 Lords Chamber

[Lord Livermore (Lab)]

No, I do not think she is, because the spring forecast showed precisely that: that Britain is well placed to weather this conflict. Inflation was at 3% and it was set to fall to target; borrowing was set to fall more over this Parliament than in any other G7 economy; GDP per capita was forecast to rise by 5.6% over this Parliament, compared with a fall of 0.2% in the previous Parliament; and we had increased headroom to over £23 billion. As I say, all these things mean we are well placed to weather this conflict. On the actual outturn data, last week’s figures show that the economy grew faster than expected in the three months to February, growth for the three months to January was upgraded, and yesterday’s labour market figures for February showed unemployment coming down and real wages continuing to rise.

[Lord Hintze (Con)]

My Lords, does the Minister agree that the only genuine way to look at the prosperity of our citizens in this country is GDP per capita? Does he also agree that one of the big detractors of growth in GDP per capita is the growing and significant welfare spend? If not, why not?

[Lord Livermore (Lab)]

I am very happy to agree with the noble Lord on the first part of his question: as I have said already, GDP per capita at the time of the spring forecast was forecast to rise by 5.6% over this Parliament. That compares with a fall of 0.2% in the previous Parliament—the worst Parliament on record for living standards. On welfare spending, as he knows, the previous Government increased welfare spending by £88 billion.