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 have comparative growth data broadly covering Labour’s first two quarters in government—July to September 2024 (Q3 2024), and October to December 2024 (Q4 2024).

The UK’s GDP grew by 0.4% in April to June 2024, just before Labour entered government.

In Q3 2024, the UK’s economy grew by 0.03%, or 0.0% when rounded to one decimal place—thus, the ONS says the UK saw “no growth” in Q3 2024. 

That represented the second lowest level of GDP growth in the G7, according to OECD data. The United States’ GDP grew by 0.8% compared to the previous quarter, France’s by 0.4%, and the GDP of both Canada and Japan grew by 0.3%. Germany’s GDP grew by 0.1%. Italy’s GDP broadly saw no growth, as was the case for the UK, though the unrounded figures show Italy was actually slightly behind the UK, with its GDP shrinking by 0.008%. 

Initial figures estimate that in Q4 2024, Labour’s second quarter in government, the UK’s economy grew by 0.1%. International comparisons published by the ONS initially show the UK had the third highest growth of the six G7 nations for which data is available at the time of writing (Japan’s figures have not yet been released). The US had growth of 0.6%, while Canada had growth of 0.4%. Italy’s GDP again saw no growth, and both France and Germany saw negative growth (-0.1% and -0.2% respectively). 

GDP data is subject to revision, so these figures may be revised at a later date.

As a result of these figures, we’ve marked this pledge as “Appears off track”. 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 not the case so far.

While monthly comparisons among G7 nations are not currently available, it’s worth noting the latest monthly data initially estimates the UK economy grew by 0.4% in December 2024. It grew by 0.1% in November after it experienced negative growth in both September and October.