The problem with this government is that it ‘tinkers’, it is not ‘bold’, according to King’s College London professor of European politics and foreign affairs, Anand Menon.
Menon made his comments when speaking at the Money Marketing Interactive conference in London today (9 October).
He added that the UK has numerous issues surrounding investment, productivity and wage growth and the problem with the way this “cautious” government is acting, is that it will not bring any change.
The UK has been “misfiring for some time now” as the country has never been able to solve the productivity puzzle, Anand said.
The UK’s productivity puzzle refers to the UK’s unusually slow and flat productivity growth since the 2008 global financial crisis.
Since then, the UK has been lagging behind many other developed economies, particularly in terms of real wage growth which has only increased by 1% in the last 20 years.
Additionally, the 2016 Brexit referendum has hurt investment as it was one of the first victims to come from the UK’s withdrawal from the European Union, Anand said.
With these large problems hovering over the UK’s economy and its growth prospects, many now think Kier Starmer is not up to the job of prime minister.
Anand added that Starmer has lost popularity quicker than any other PM before him.
The Professor also highlighted that the UK has slashed defence spending since the Korean War and put money into health.
However, this dwindling figure may now start to turn around as the NATO’s June summit in The Hague saw members commit to raise spending to 5% of GDP by 2035.
This has resulted in UK retail investors holding the belief that defence will outperform all other sectors including artificial intelligence over the next six months.
This is according to a biannual sentiment tracker from investing and trading platform IG in July. This was the first time defence had taken the top spot, with AI now in second place.
