Finally, despite a string of embarrassing local election defeats, and today’s shock defection of Dover MP Natalie Elphicke to Labour, there is some good news for Rishi Sunak. Ministers believe that three economic statistics to be issued over the next two weeks will help to persuade voters the economy has improved by an October or November general election.
Tomorrow (Thursday) the Bank of England might give us a hint about when it will cut interest rates. On Friday, GDP figures will almost certainly show the UK emerged from recession in the first three months of this year. On 22 May, the Office for National Statistics will report that inflation (currently at 3.2 per cent) has dropped close to the Bank’s 2 per cent target.
Tory strategists claim Sunak’s message the economy is “turning a corner” does resonate with voters – a precious oasis of hope in a desert of gloom and pessimism. The forthcoming statistics will strengthen this claim. But the flaw in the strategy is that people will not feel better off by the autumn. Indeed, opinion polls suggest the public believes the economy is getting worse, and that inflation, interest rates and taxes are still going up (which overall taxation is, due to the freeze in allowances and thresholds). So much for Jeremy Hunt’s double cut in national insurance.
