Reeves insists there will likely be no change in technique regardless of sluggish financial progress

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Your assist makes all of the distinction. Learn extra Rachel Reeves has doubled down on the federal government’s financial plan and insisted there will likely be no change in technique regardless of progress sitting at simply 0.1 per cent within the closing quarter of final yr.

The chancellor rejected calls to vary course, arguing that Labour’s plan is “starting to ship” for individuals.

Requested whether or not the federal government plans to vary its technique in gentle of the newest sluggish progress figures, the chancellor informed broadcasters: “We have now a plan. We have now a plan to develop our economic system, and that plan is starting to ship.

“We're placing more cash in individuals’s pockets. Is there extra to do? Completely, which is why we’ve reformed the planning system to make it simpler to construct in Britain. It’s why we're lowering the regulatory burden to make it simpler for companies to spend money on Britain.

“It's why we’re placing cash in individuals’s pockets of working households by bettering the childcare accessible to folks of younger kids. All of these items are good for productiveness, are good for progress,” Ms Reeves stated.

She added: “We’ve acquired the correct financial plan. It's starting to ship for individuals in our nation and we’ll be sticking to that plan.”

Her reluctance to vary tack comes regardless of revelations this week that well being secretary Wes Streeting had beforehand voiced considerations that the federal government had “no progress technique” in messages between himself and Lord Peter Mandelson, printed as a part of an try and show he had nothing to cover on the subject of his relationship with the disgraced peer.

In new figures printed on Thursday, the Workplace for Nationwide Statistics (ONS) stated UK GDP grew by 0.1 per cent within the closing quarter between October and December final yr, following progress of 0.1 per cent within the third quarter.

The fourth quarter figures imply the economic system grew by 1.3 per cent general in 2025, up from 1.1 per cent in 2024 and the best progress since 2022, however decrease than the 1.4 per cent anticipated by the Financial institution of England and most economists.

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It follows a risky finish to 2025 for the British economic system, with output declining by 0.1 per cent in October after which rebounding by a downwardly revised 0.2 per cent in November because the manufacturing sector was boosted by recovering manufacturing at Jaguar Land Rover after its main cyber assault.

<img src="https://static.independent.co.uk/2026/01/27/17/73cf9f588b463cda75853225874ca266Y29udGVudHNlYXJjaGFwaSwxNzY5NjIxMzk4-2.83229772.jpg" srcset="https://static.independent.co.uk/2026/01/27/17/73cf9f588b463cda75853225874ca266Y29udGVudHNlYXJjaGFwaSwxNzY5NjIxMzk4-2.83229772.jpg?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2026/01/27/17/73cf9f588b463cda75853225874ca266Y29udGVudHNlYXJjaGFwaSwxNzY5NjIxMzk4-2.83229772.jpg?quality=75&width=640&auto=webp 640w" loading="lazy" alt="The modest growth occurred after chancellor Rachel Reeves’ autumn Budget" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

The modest progress occurred after chancellor Rachel Reeves’ autumn Funds (PA) Funds uncertainty added to stress within the quarter, with the lengthy lead-up broadly seen to have held again progress forward of the 26 November fiscal occasion.

It's nonetheless anticipated that the primary quarter of 2026 will present a stronger degree of progress, however significant and sustained financial enlargement stays depending on inflation coming down and companies adapting to new, increased ranges of prices – whereas unemployment additionally stays above 5 per cent.

Ms Reeves gave little justification for the muted finish to the yr, however insisted the federal government “has the correct financial plan to construct a stronger and safer economic system, chopping the price of residing, chopping the nationwide debt and creating the circumstances for progress and funding in each a part of the nation”.

In the meantime, the prime minister stated the figures confirmed the economic system was rising. Writing on X/Twitter, he added: “I do know there’s extra to do, however we're on target.”

The figures confirmed the UK’s dominant companies sector flatlined within the fourth quarter with zero progress, whereas manufacturing expanded by 1.2 per cent and development fell by 2.1 per cent, marking the sector’s worst progress for over 4 years.

The Financial institution of England on Thursday reduce its progress forecast for 2026, from 1.2 per cent to 0.9 per cent, and for 2027, from 1.6 per cent to 1.5 per cent.

Liz McKeown, ONS director of financial statistics, stated: “The economic system continued to develop slowly within the final three months of the yr, with the expansion price unchanged from the earlier quarter.

“The customarily-dominant companies sector confirmed no progress, with the principle driver as an alternative coming from manufacturing.

“Development, in the meantime, registered its worst efficiency in additional than 4 years.

“The speed of progress throughout 2025 as a complete was up barely on the earlier yr, with progress seen in all most important sectors.”

The British Chambers of Commerce (BCC) has referred to as for presidency motion to again up their phrases to help financial restoration, noting that small companies are holding again on spending as a consequence of lingering fears about rising taxation and different value pressures.

“Bettering the outlook now will depend on restoring enterprise dynamism. Authorities should transfer from technique to supply – backing infrastructure tasks, dashing up planning selections, addressing expertise gaps, and strengthening export assist – so companies can make investments, export and develop,” stated the BCC’s head of analysis, David Bharier.

<img src="https://static.independent.co.uk/2026/02/12/7/28/Figure-1_-Real-GDP-grew-by-0-1-in-the-three-months-to-December-2025-after-falling-by-0-1-in-the-thre.png" srcset="https://static.independent.co.uk/2026/02/12/7/28/Figure-1_-Real-GDP-grew-by-0-1-in-the-three-months-to-December-2025-after-falling-by-0-1-in-the-thre.png?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2026/02/12/7/28/Figure-1_-Real-GDP-grew-by-0-1-in-the-three-months-to-December-2025-after-falling-by-0-1-in-the-thre.png?quality=75&width=640&auto=webp 640w" loading="lazy" alt="Real GDP grew by 0.1 per cent in the three months to December 2025" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

Actual GDP grew by 0.1 per cent within the three months to December 2025 (ONS) The Trades Union Congress (TUC) in the meantime, identified that the year-long progress was a latest excessive, however normal secretary Paul Nowak nonetheless urged the Financial institution of England to chop rates of interest extra shortly to stimulate spending.

“It’s welcome that the economic system stored rising in December, and final yr’s progress of 1.3 per cent was the strongest for 3 years,” he stated.

“However many employees are usually not but feeling the profit of their pockets. Many working households don’t have any cash left over to spend on the issues that maintain our economic system transferring.

“This doom loop should finish. Ministers should keep laser-focused on chopping working individuals’s family prices and bettering residing requirements this yr.

“And the Financial institution of England should go additional and quicker with quickfire interest-rate cuts within the months forward.

“Britain must lastly transfer on from the price of residing disaster that’s stored us caught for too lengthy – the precedence have to be serving to households to spend and companies to take a position.”