What does the pledge mean?

The UK is one of seven advanced economies considered part of the ‘G7’ group. The others are Canada, France, Germany, Italy, Japan and the United States. 

The main measure of economic growth globally is Gross Domestic Product (GDP). In the UK, this is generally expressed as ‘economic output’—the value of goods and services produced during a given period. UK data is released by the Office for National Statistics (ONS), which also publishes international comparisons of the UK’s real GDP growth alongside other G7 countries. 

Labour’s manifesto didn’t specify what timeframe it expects to deliver this pledge within, or what it means by “sustained” growth. We asked the Treasury about this in October 2024, and again in November 2024, but haven’t had a response. 

The ONS releases GDP data monthly, quarterly and annually, and publishes international comparisons quarterly and annually. We don’t know which measure the government intends to use to track progress on this pledge, however.

How much control a government has over its country’s GDP is debatable. While government policies can certainly influence economic growth, GDP growth can depend on a wide range of other factors, such as geopolitical developments or even the weather. 

As we’ve written previously, ahead of the election the Prime Minister Sir Keir Starmer expressed an ambition for the UK’s annual GDP growth to reach 2.5%.

A very similar pledge also appeared in the government’s “Plan for Change”, which was launched on 5 December 2024. In it, the government said it would “aim to deliver the highest sustained growth in the G7”, rather than “secure”, as was the wording in the manifesto. This has been interpreted by some to represent a weakening of the original pledge, which the government denies. 

What progress has been made?

So far, we only have comparative growth data from Labour’s first quarter in government—July to September 2024. This data was released by the ONS on 15 November, and shows that in this period the UK’s GDP grew by 0.1% compared to the previous quarter, following growth of 0.5% in April to June 2024.

The UK had the third lowest level of GDP growth in the G7 in Labour’s first quarter in government, according to OECD data. France’s GDP grew by 0.4% compared to the previous quarter, the United States’ by 0.7%, and the GDP of both Canada and Japan grew by 0.3%. The UK’s growth figure slightly outstripped Germany’s, with the OECD’s detailed analysis putting them at 0.142% and 0.105% respectively, while Italy’s GDP had no growth. 

As a result, we’ve marked this pledge as ‘Appears off track’, even though it’s early days. It’s possible that, over the coming months or years, the UK’s growth will end up consistently higher than other G7 nations, either in quarterly or annual data, but this is the only international comparison we have for now.  

While monthly comparisons among G7 nations are not currently available, it’s worth noting the latest monthly data shows the UK experienced negative growth in both September and October 2024. This comes after three months of consecutive growth in the previous quarter, and suggests we may see a fall in the UK’s GDP when growth figures for the current quarter, October to December 2024, are released in 2025. However, this doesn’t necessarily mean that we can definitively say the UK’s growth will not be the highest in the G7 over this period, as other countries may see greater negative growth.