Starmer under pressure as economy stagnates despite vow to revive it

The UK economy flatlined between July and September and is on track to have stagnated over the entire second half of 2024, adding to pressure on Keir Starmer over his promise to reboot growth.

- Richard Partington Pippa Crerar

In an unexpected downgrade, figures from the Office for National Statistics showed growth in the third quarter was revised down to zero, below an initial estimate of 0.1% made last month.

The figures underline Labour's challenging start in power, with Rachel Reeves coming under intense scrutiny over her downbeat assessment of the economy, arguing that the Conservatives' dire legacy left her no choice but to impose £40bn of tax increases in her autumn budget.

After the growth revision, the chancellor defended her approach, arguing the government was focused on driving up "sustainable long-term growth" by reforming the economy.

"The challenge we face to fix our economy and properly fund our public finances after 15 years of neglect is huge," she said.

Speaking to the Guardian, Reeves said she would not "gaslight" the public about how long the turnaround would take.

"Has it been difficult? Yes," she said. "Is there more to do? Absolutely. Next year is really going to be about delivering for working people. This year a lot of it has been about fixing the foundations, bringing the stability back."