Cost of living crisis is more important to voters than 'war on woke': Greg Wright

As the new year dawns, battle lines will be drawn in preparation for a General Election campaign which can only be months away.
Greg Wright
By Greg Wright
Published 27th Dec 2023, 07:53 GMT

If they want to understand what makes voters’ tick, all the major parties should heed the sage words of James Carville, the master strategist who oversaw Bill Clinton's successful 1992 US Presidential campaign: “It’s the economy, stupid." It may surprise some outside the Westminster bubble, but the vast majority of Britons couldn’t care less about the “war on woke” or the number of diversity and inclusion officers within the civil service. They are very worried about feeding and clothing their families and whether their business might go bust due to high interest rates and weak consumer confidence. Homeowners in particular have been put through the wringer as they have faced higher mortgage costs following 14 interest rate rises in a row, on top of higher energy and food costs.

Insolvency professionals have been steeling themselves for a potentially frenetic January. Eleanor Temple, regional chair of R3,the trade association for insolvency and restructuring professionals, warned earlier this month that data is showing the UK as a ‘stagnation nation’.

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She added: “It is concerning to see this being borne out with our latest analysis..revealing falling numbers of new businesses and growing insolvency-related activity here and across much of the country.

It may surprise some outside the Westminster bubble, but the vast majority of Britons couldn’t care less about the ‘war on woke’ or the number of diversity and inclusion officers within the civil service. They are very worried about feeding and clothing their families, says Greg Wright. (Photo by Joe Giddens/PA Wire)It may surprise some outside the Westminster bubble, but the vast majority of Britons couldn’t care less about the ‘war on woke’ or the number of diversity and inclusion officers within the civil service. They are very worried about feeding and clothing their families, says Greg Wright. (Photo by Joe Giddens/PA Wire)
It may surprise some outside the Westminster bubble, but the vast majority of Britons couldn’t care less about the ‘war on woke’ or the number of diversity and inclusion officers within the civil service. They are very worried about feeding and clothing their families, says Greg Wright. (Photo by Joe Giddens/PA Wire)

She added: “The economy appears to be flatlining with little sign of sustained growth, and the impact of inflation is continuing to hamper consumer spending and business activity in what should be one of the busiest periods of the years. There’s no doubt that the rapid rise in interest rates since late 2021 is taking its toll and it now looks like there is a real risk of the UK falling into recession next year.”

Begbies Traynor has predicted that its insolvency division will continue to secure more business over the coming months, which is a worrying sign for thousands of small firms across the country. Begbies said the number of businesses going insolvent in the UK increased by a little over 17 per cent to 24,326 in the year to the end of September. Most of these companies were small firms that went into liquidation, but the number of administrations, which tend to involve larger companies, also increased to close to pre-pandemic levels. Begbies said it now anticipates “continued increase in insolvency activity” and has expanded its team to deal with the new business. “We anticipate that activity levels in our largest service line of insolvency will continue to increase in tandem with the indicators of corporate financial stress in the UK,” it told shareholders.

There may be light at the end of the tunnel. Inflation dropped to its lowest level for more than two years last month, prompting speculation that the Bank of England could start cutting interest rates in early 2024. The chancellor Jeremy Hunt claimed the UK was back on the path to healthy, sustainable growth. If he’s right, the Tories’ chances of winning the election will receive a massive boost. The surest way to gain support at the ballot box is to display a steady hand on the economic tiller.

Greg Wright is the deputy business editor of The Yorkshire Post

Related topics:Greg WrightHomeownersJeremy HuntInflation

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