Nearly half of UK businesses are planning to increase investment, according to a survey – a glimmer of optimism for an economy that has been battered by political turbulence. But official figures from the Office for National Statistics tell a more cautious story: business investment rose 0.9 per cent in the first quarter, yet remains 1.3 per cent below the level recorded a year earlier. Transport was the largest contributor to the quarterly increase.
The mixed picture comes against a backdrop of extraordinary political instability. Andy Burnham has become the fifth prime minister in four years, inheriting an economy where uncertainty has repeatedly delayed spending decisions. He has promised to be “a pro-business leader of the Labour Party, as I was a pro-business mayor of Greater Manchester” – a pledge designed to reassure firms that have grown wary of frequent changes in government direction.
“47% of firms plan to increase investment, but ONS data shows it remains 1.3% below last year.”
For now, the recovery in business investment is real but shallow. The 47 per cent of firms planning to spend more suggests confidence may be returning, but the year-on-year decline warns that the ground lost under previous administrations has not yet been reclaimed. Whether Burnham’s pro-business message can turn cautious intentions into concrete spending will determine how quickly the UK closes that gap.