Gloomy pre-Budget warnings led to stalled growth in Labour’s first three months in power, figures show

GLOOMY pre-Budget warnings led to stalled growth in Labour’s first three months in power, figures show.

The economy grew just 0.1 per cent between July and September amid low business confidence.

Reuters

Chancellor Rachel Reeves tried to play down the poor economic growth figures, only saying she was ‘not satisfied’[/caption]

It is an even bigger slowdown than expected from the 0.5 per cent in April to June.

The UK now has the second worst growth among the G7 of largest developed economies — despite PM Sir Keir Starmer pledging to make the nation the G7’s fastest-growing.

Chancellor Rachel Reeves yesterday tried to play down the figures, only saying she was “not satisfied”.

Her Tory counterpart Mel Stride blamed Labour for talking down the economy after its July election win, and said it was “reaping, to a degree, what they’ve done”.

CBI lead economist Ben Jones said: “Uncertainty ahead of October’s Budget probably played a big part, with firms widely reporting a slowdown in decision-making. Hopefully this will prove a blip.”

Simon Pittaway, at think- tank the Resolution Foundation, added: “After bouncing back from recession earlier this year, the recovery is already running out of steam.”

Growth was subdued across most industries.

The service industry, one of the hardest-hit by the Chancellor’s tax raid, saw 0.1 per cent growth.

Kate Nicholls, of UK Hospitality, said: “These lacklustre figures make it clear the economy is in a fragile place.”

She said the potential for growth remained “if the Government rethinks changes to National Insurance Contributions and takes a High Street-first approach to growth”.

Downing Street said the Government was focused on supporting long-term growth to ensure everyone benefits from prosperity.