Why is it that whenever some organisation comes up with some half-baked prediction of doom for the UK economy post-Brexit it is splashed all over the news, yet real data on the economy gets ignored? Yesterday, the ONS quietly released the latest figures for Gross Fixed Capital Formation (GFCF) which covers investment across the whole economy, public and private sectors, manufacturing, construction, services and extractive industries.
They showed that contrary to the received wisdom that investors have fled the UK following the Brexit vote, investment grew by 1.1 per cent in the fourth quarter of 2017, to a total of £84.1 billion. Over the course of 2017 it grew by 4 per cent compared with 2016. This was higher than for any other G7 country – with Italy following on 3.7 per cent, France 3.5 per cent, the US 3.2 per cent and the US on 3.1 per cent?
Is this not news? The BBC doesn’t seem to think so. It didn’t make the business news on the Today programme, nor does the story appear on the business section of the BBC website. The Guardian didn’t bother with it, though it did big up statistics showing the UK had the slowest rate of growth in consumer spending in the G7. The Times carried a story about another piece of good economic news – the decline in the UK’s current account deficit – but did not mention the investment figures.
The only paper that did give the investment figures space was the FT – although in a somewhat loaded way, suggesting that it was only really down to a construction boom and that lots of investment decisions in new office space must have been made before the referendum. Somehow, I suspect the FT wouldn’t have taken this line had investment fallen – that would very much have been connected with the Brexit vote. For the record, business investment – which excludes the public sector and the construction of dwellings – accounted for £46.2 billion of the £84.1 billion invested in the fourth quarter of 2017. Over the course of 2017, business investment in the UK grew by 2.6 per cent. The ONS does not compare this particular figure internationally, however, because of differences in how it is compiled.
Brexit is not guaranteed to bring a bonus to the UK economy – far from it, it could still prove a disaster if the wrong decisions are made by a future UK government, shutting us off from the world and bailing out failing industries rather opening up and economy and encouraging growing industries. But it would be extremely helpful to all of us if we could be fed rather less propagandist speculation about the future direction of the economy, made by organisations which have already been embarrassed by the grim forecasts they made ahead of the referendum, and we got to hear rather more genuine economic news.