LONDON — Liz Truss is still battling the economic “orthodoxy” that killed off her premiership.
The U.K.’s shortest-serving prime minister joined assorted economists, wonks and journalists Wednesday morning for the launch of a brand new group — the Growth Commission — that’s aiming to put rocket boosters under Britain’s sluggish economy.
In so doing, the avowed free-marketeer is setting up an alternative to august institutions like the Office for Budget Responsibility (OBR), the U.K.’s Treasury, and the International Monetary Fund (IMF) that cast major doubt on her program of debt-funded tax cuts. Such organizations have been disparagingly labelled the “blob” by some Conservatives.
Truss’ plan spooked markets and hastened the end of her short-lived government. She’s since blamed “orthodoxy” in the U.K.’s finance ministry. But the commission — convened by Truss but with no formal role for the ex-PM — wants to change the debate in Westminster and Whitehall at a time when quarterly GDP growth sits at a measly 0.1 percent.
Rather than dreaming up its own plans like a think tank, the commission wants to start a broader conversation about how advanced nations have lost their way on the need for growth. It will forecast how government policies affect GDP per capita in five, 10 and 20 years’ time, including the coming Autumn Statement — effectively challenging the OBR.
Co-chairman Douglas McWilliams said Wednesday that Britain’s economic woes are multifaceted. “You don’t do as badly as we’re doing without there being more than one cause,” McWilliams said.
McWilliams and fellow co-chair of the Growth Commission, former government adviser Shanker Singham, blamed this state of affairs partially on over-burdensome business regulation, a lack of competition, poor productivity, and the U.K. not having quite got its “mojo” back post-pandemic. The commission launched with a report warning that the average U.S. household has £24,000 a year more spending power than in the U.K.
The Growth Commission is aiming to take a zoomed-out view of the U.K.’s economic state.
It’s pushing for Britain to achieve annual per capita growth of 3 percent — a trend not seen since 1950 — and argues that if this happens over the next two decades, the economy will be 65 percent bigger by 2040 than it would otherwise have been.
And Britain can get there by (of course) listening to the Growth Commission.
The appetite for growth is there from both sides of the house. It’s one of Keir Starmer’s five big missions for the U.K. and it’s one of Rishi Sunak’s own five pledges. But a key question that looms over the Growth Commission is whether a Truss-collated group of experts will really get a hearing.
Truss did not join the panel of experts on stage, but sat second row from the front. That meant she couldn’t take questions from the press, and hurried off at the end. But if she had, one brave soul might have asked if her less-than-two-month premiership is at least one of the reasons the U.K. is struggling.
Pressed on this point after the event, McWilliams said Truss “only had a very early chance, and only bit off a very small amount of what she believed was necessary.”
Dan Bloom contributed reporting.
