Chancellor Jeremy Hunt to declare ‘the future’s bright’ with the Tories as he sets out UK growth plan

The Chancellor is set to deliver an upbeat message in a keynote speech today

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Chancellor Jeremy Hunt will dismiss “gloom” about the prospects for the UK economy as he sets out his plan to boost growth on Friday.

Hunt will say the country stands ready to take advantage of its Brexit “freedoms” to become a new world leader and will deliver an upbeat message in a keynote speech today (27 January).

In his address he will say “declinism about Britain was wrong in the past and it is wrong today”, amid mounting criticism over the government’s strategy for the economy.

He is expected to continue to resist calls from some Tory MPs for tax cuts to kick-start flagging economic growth, and will instead say the UK should exploit the opportunities provided by the withdrawal from the EU to raise productivity, while using the proceeds of growth to support public services.

Hunt’s address comes after a Cabinet away day at Chequers on Thursday (26 January), where the Chancellor said ministers must maintain their “disciplined approach” if they are to get inflation under control.

Hunt will dismiss “gloom” about the prospects for the UK economy (Photo: Getty Images)Hunt will dismiss “gloom” about the prospects for the UK economy (Photo: Getty Images)
Hunt will dismiss “gloom” about the prospects for the UK economy (Photo: Getty Images)

Speaking at Bloomberg’s European headquarters in London on Friday, Hunt will say that some of the “gloom” about the current economic outlook is based on statistics which “do not reflect the whole picture”.

According to advance extracts from his speech released by the Treasury, he will say: “Like every G7 country, our growth was slower in the years after the financial crisis than the years before it. But since 2010, the UK has grown faster than France, Japan and Italy. Since the Brexit referendum, we have grown at about the same rate as Germany.

“If we look further ahead, the case for declinism becomes weaker still. The UK is poised to play a leading role in Europe and across the world in the growth sectors which will define this century.”

The Chancellor will add that what the government offers is a plan for “long term prosperity based on British genius and British hard work”.

“It is a plan necessitated, energised and made possible by Brexit which will succeed if it becomes a catalyst for the bold choices we need to take,” he will say. Our plan for growth is a plan built on the freedoms which Brexit provides. It is a plan to raise productivity.

“It is a plan to use the proceeds of growth to support our public services at home, to support businesses in the new low-carbon economy and to support democracy abroad. It is the right course for our country and the role in the world to which we aspire.”

Hunt will also use his speech to announce that the government is to proceed with reforms to so-called “Solvency II” – an EU directive that governs the amount of funds British insurers are required to hold in reserve.

The Treasury pointed to an estimate by the Association of British Insurers which suggested the changes could unlock up to £100 billion of private investment into UK infrastructure and clean energy – such as nuclear power – over the coming decade.

It comes as the Chancellor faces calls to cut taxes in his budget in a bid to inject growth into the economy, but at Chequers on Thursday, both he and Prime Minister Rishi Sunak emphasised that inflation remains the top priority.

They say inflation was only predicted to fall because of the “tough decisions” taken to stabilise the economy following former PM Liz Truss’s catastrophic mini-budget tax giveaway.

Hunt has warned that the government must maintain its “disciplined approach” to the public finances if it is to get inflation under control.

“The Chancellor said it would be necessary to retain this disciplined approach in order to reduce inflation, because it is the greatest driver of the cost of living,” according to a No 10 readout of the meeting.