New data shows that Brits have suffered a decline in living standards, as GDP per capita has fallen due to migration outstripping growth.
Real GDP per head has fallen by 0.3 percent between April and June 2024 compared to last year, according to the Office for National Statistics (ONS).
Chancellor Rachel Reeves speaking at Labour Party conference. (Image: Getty)
Net migration hit a record of 685,000 last year, with most migrants arriving legally and a small proportion via the English Channel in rubber boats.
Experts said the figures show that migration is growing faster than the British economy – a gloomy backdrop for Rachel Reeves ahead of her first budget.
Net migration is still in the hundreds of thousands. Last year it was over 600,000. (Image: Getty)
According to The Telegraph, Paul Dales, chief UK economist at Capital Economics, said: “You have had the population growing at a faster rate than GDP. That increase in the population was almost entirely due to fairly rapid rates of inward migration.
“It suggests living standards are not really improving that much. The increase in GDP we have seen is by and large just because there are more people in the country. But on a per person or household basis, there is not any more income to go around. It is a bit worrying.”
Meanwhile, a key decision the Chancellor is considering threatens to cause interest rates to spike, according to the Institute for Fiscal Studies (IFS).
GDP per capita in the UK is falling according to official figures (Image: Getty)
Ms Reeves is mulling over rewriting fiscal rules to free up £50bn and doing so “would not be without risks”, claims the IFS.
The Chancellor would use the money to finance large infrastructure projects, but the think tank warns remodelling the rules could be a mistake.
The IFS said: “There is a risk that the Government is perceived to be making a change not for principled reasons, but for opportunistic ones – to allow for significantly more borrowing for investment without any need for tough choices elsewhere.”
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Keir Starmer plots to cosy up to EU in latest Brexit betrayal
Sir Keir Starmer faces a furious Brexit backlash as he travels to Brussels to cosy up to the EU.
Sir Keir Starmer is planning to cosy up to the EU (Image: Getty Images)
The Prime Minister has vowed to “put the Brexit years behind us” ahead of a meeting with European Commission president Ursula von der Leyen, European Council chief Charles Michel and the European Parliament’s Roberta Metsola.
Sir Keir wants to “establish a more pragmatic and mature relationship with the European Union”.
But furious Eurosceptics warned it is the latest sign the Labour leader will betray the British people over the historic decision to quit the bloc in 2016.
Reform UK’s Lee Anderson has slammed the latest EU plot (Image: AFP via Getty Images)
Reform UK’s Lee Anderson told the Daily Express: “Slippery Starmer will stop at nothing to see us back in the EU.
“It’s obvious that Starmer is about to commit his biggest act of treachery yet by turning his back on democracy and the 17.4 million people that voted to leave the EU.
“This will come back to haunt him at the next election, that’s if he lasts that long.”
Tory leadership candidate James Cleverly MP said: “Keir Starmer has flip-flopped on Brexit for years; he wanted a second referendum then he didn’t. He’s spent years trying to reverse it and his intentions are pretty clear. He will do anything to cosy up to Europe.
“I backed Brexit from day one. As leader of the Conservative Party, I will take the fight to Starmer and stand up for what the British people voted for.”
Reform UK Deputy Leader Richard Tice added: “The EU is in meltdown led by Germany.
“We are struggling but doing better than them.
“The last thing we need is open borders again to mass youth freedom of movement since that represents the vast majority of immigration into the UK.
“The OBR has admitted that low skilled immigration makes us poorer as they take out more than they put in by taxes. The ONS has just told us we are worse off per head since last year due to mass immigration.”
The Prime Minister will push for a better trading relationship and greater co-operation on defence and security measures.
But he is under pressure to agree to Brussels’ calls for a deal on youth mobility to allow young EU citizens greater freedom to come to the UK to study and work and vice versa, something Sir Keir has so far resisted.
Ahead of the trip, he said: “The UK is undeniably stronger when it works in lockstep with its closest international partners. This has never been more important – with war, conflict and insecurity all knocking on Europe’s door.
“We will only be able to tackle these challenges by putting our collective weight behind them, which is why I am so determined to put the Brexit years behind us and establish a more pragmatic and mature relationship with the European Union.
“Better co-operation with the EU will deliver the benefits the British people deserve – securing our borders, keeping us safe and boosting economic growth.”
No concrete announcements are expected from what is the first formal meeting between Sir Keir and the Brussels chiefs as part of his plan to “reset” UK-EU relations.
The European Commission said the meeting with Ms von der Leyen would be “the beginning of a conversation”.
The Prime Minister’s red lines for the reset rule are said to be a return to the single market, the customs union or freedom of movement.
But the EU’s ambassador in the UK, Pedro Serrano, has suggested a potential compromise on Brussels’ demand for an EU mobility scheme.
The proposed scheme could see young people move freely during a gap year – rather than for longer.
Mr Serrano has told Times Radio: “If we have a mechanism that allows young British citizens to go out for a gap year, for example, to any – they have a choice of 27 states within the European Union – to do a bit of learning and pay there for their learning while they’re there. Why not?
“If people want then to stay later for work, it’s a totally different process. This would be limited in time.”
The idea is much more restrictive than some have suggested a youth mobility scheme could look like.
The European Union would like to give its young people the opportunity to travel freely to the UK, in return for young people from the UK being able to do the same in the EU’s 27 member states.
Asked if a youth mobility scheme was on the cards, Prime Minister Keir Starmer said: “We’ve no plans for a youth mobility scheme but we are heading out [to Brussels] for an important meeting this week – I don’t want to get ahead of any important discussion we’ll have but it is an important meeting this week which will go ahead.”
He also said there was a new deal to be done with the EU on defence, security and trade – which will make it easier for businesses to work with European nations – but warned it would be challenging.
