Growth compete with other missions of labor

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FT editor Roula Khalaf, chooses his favorite stories in this weekly newsletter.

The writer is the Director of the Institute of Finance Research

The cloud of numbers in Rachel was hidden “Expenditure Spend” large trading-offs. Chancellor, a number of departments sounded with an investment friction, the name of the circles that will benefit from special projects and all of the work to be supported.

We knew the government would increase in investment. It was always the main part of how to work to fulfill the number one mission of labor economic growth. What we do not know was that there was such a great share – more than 60 percent of additional costs, the protection of additional costs and the net will go to the net zero.

Pay attention to these areas can increase growth. However, it is wrong to think that an effective growth rate is simply a bigger economy, but it is an incredible result – an inevitable result. Simply buying and selling weapons. Something that supports households to switch to heat pumps and is more cleaner (hot houses), probably more expensive and more expensive.

It is also wrong to think that the growth is friends for creating investments in business. More work in an area outside a recession means fewer jobs in another place. Instead of paying attention to how much work to buy something produced, we need to pay attention to how much everyone can result. There is a business problem, but the productivity problem.

Last week, the industrial strategy, which aims to deploy as a leader in the sectors identified as a high growth potential, including the UK defense and clean energy, came out of investments. Purpose investments – especially innovative, those who promote innovation – have the potential to improve growth and improve employees to more productive areas. But if the government does not want more defense, will those who have weapons and nuclear submarines, even innovative, the best way to grow economic growth? Seems impossible.

It may be more confident that the government infrastructure investment and increase in R & D growth. The UK has been a long time in transport infrastructure relative to long-developed economies. A better update is a better update to make people and places and encouragement is a way for higher productivity.

The Department of Science, Innovation and Technology, the annual budget by the end of the parliament must see the increase of £ 3.8 billion in the budget, which will see extraordinary inflation. However, the transport department receives a total of £ 1.8 billion. Falling costs in HS2 will discharge resources for other projects, but the overall transport budget is reduced by real terms. Both settlements are added to an additional 14 billion pounds and continues to 9 billion pounds of power safety department and net to zero.

We should be careful of a narrative that sounds like you are not in the trade. More investments are less than other places for defense and clean energy. It is not the only goal of growth because the industrial strategy itself accepts. There are other priorities from Sir Keir Starmer and do not come cheap.

After choosing the way you want to choose the top, the government should pay attention to all growth-friendly projects to ensure the delivery of projects on time and budget. This is really a priority.

The government is compared to the aggregate of additional investments in this parliament, when compared to the conservative plans (in the early 2024). In the same period, the forecasted an additional 140 billion pounds lend. The growing government increases in higher growth. The growth of higher debt and interest payments makes it more necessary.