Today’s news that the UK went into recession at the end of last year is even worse than the headline figures suggest.

Although the UK economy officially shrank by just 0.3% in the last quarter, that figure fails to take into account the big increase in the country’s population over that period, due to high levels of immigration.

Once you take that into account the UK’s performance is far worse. According to today’s figures, GDP per person - which shows the real impact of the economy on individuals - actually fell by 0.6% over the last three months of 2023.

It gets even worse when you look beyond the last quarter. According to today’s data, the British economy has not grown at all, per person, for almost two years. This is the longest period without per capita growth in the UK since 1955.

The longer term picture is even worse than this, with the UK’s economic growth a huge 24% lower than it would have been had we remained on the same growth trend we were on before the financial crisis.

There are good reasons for this extended period of stagnation. A decade of austerity, Brexit and the coronavirus pandemic have all contributed to what has been the biggest real-terms fall in living standards in the UK since records began. 

So given this grim outlook, you might expect that the Chancellor would be talking about bold plans to finally kickstart the British economy after 14 years in Government.

This is not what’s happening. Instead the Financial Times today reports that Jeremy Hunt is considering plans to make even bigger cuts to public spending after the next general election than those he has already set out.

According to the paper, "economists have warned that current plans for a 1 percentage point increase in public spending until 2029 are a “fiction”, as they would imply serious real-term cuts to some stretched public services.

"But people close to Hunt said Treasury officials were considering going further and reducing projected spending rises to about 0.75 percentage points a year, releasing £5bn-£6bn for Budget tax cuts."

This plan, which is predicated on the political desire to offer voters a series of pre-election tax cuts, would leave many of Britain’s already crumbling public services under the threat of complete collapse.

Now you might expect that such plans would trigger big public debate about the future of the economy and public services.

Yet despite Hunt’s slash and burn agenda already being signalled months ago in his Autumn Statement, these plans for a big new wave of austerity have so far received next to no coverage in the British press, outside of the FT, with most papers instead focusing on an endless debate about taxes and borrowing.

This focus, which has culminated in the Labour Party last week rowing back on its own plans to kickstart growth in the UK, is wildly out of step with what the economy needs and what the public actually wants. According to recent polling for Byline, voters in all parties now prioritise investment in public services over tax cuts. 

Yet instead of having a big debate about actually investing in the UK’s stagnant economy, while restoring Britain’s failing public services, both major parties in Westminster remain focused on the same sterile debate about ‘balancing the books’ and ‘fiscal rules’ which helped lodge the British economy into its current slump in the first place.

The truth is that unless this changes, Britain's lost decade of stagnant growth and low productivity will only continue well into the future.