Brexit will have a negative impact on the UK’s economic growth “for the foreseeable future”, the UK’s most senior banker has warned.

Bank of England governor Andrew Bailey said a decline in the UK’s potential growth rate from 2.5% to 1.5% over the past 15 years was linked to lower productivity growth, an ageing population, trade restrictions – and post-Brexit economic policies.

But he did add that the economy is, however, likely to adjust and find balance again in the longer term.

“Over the longer term, there will be – because trade adjusts – some at least partial rebalancing,” he added.

Speaking at an international banking seminar on Saturday in Washington DC, Mr Bailey said: “For nearly a decade, I have been very careful to say that I take no position per se on Brexit, which was a decision by the people of the UK, and it is our job as public officials to implement it.

“But, I quite often get asked a second question: what’s the impact on economic growth?

“And as a public official, I have to answer that question.

“And the answer is that for the foreseeable future it is negative.”

However, Mr Bailey did say investment in innovation and new technologies, including AI, may help address the decline in productivity growth in the long run.

“If we take account of the impact of ageing and trade restrictions, we’re really putting our chips on investment,” he added.

“We’re putting our chips on general-purpose technology, and AI looks like the next general-purpose technology, so we need to work with it.

“We need to ensure that it develops appropriately and well.”

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Mr Bailey warned that, although AI is likely to usher in a breakthrough in productivity long-term, it may “in the current circumstances, be a risk to financial stability through stretched valuations in the markets”.

“It doesn’t undermine the fact that AI, in my view, is likely, in addressing this slower growth issue, that we have and the consequences of it – that it is actually the best hope we have, and we really do need to do all we can to foster it,” he said.

The Bank of England governor’s prediction comes as Chancellor Rachel Reeves is under pressure ahead of next month’s budget, with official figures showing muted growth in August following a surprise contraction in July.

Inflation surge

The Office for National Statistics (ONS) said gross domestic product (GDP) rose by 0.1% month-on-month in August and fell by 0.1% in July, in a revision to the previous estimate for no growth.

In the three months to August, GDP grew by 0.3% compared with 0.2% growth in the three months to July, the ONS said.

The latest figures come after the International Monetary Fund earlier this week forecast UK inflation was set to surge to the highest in the G7 in 2025 and 2026.

Ministers have unveiled their flagship plan to train and recruit workers for the booming clean energy sector, which it is hoping to supercharge in the next five years.

Up to £18m of new money has been pledged by the UK and Scottish governments specifically to move those working in the oil and gas sector into new roles.

Their jobs are about to fall off a cliff as the industry declines, with at least 40,000 of the current 115,000 jobs forecast to disappear by the early 2030s.

Almost all of those roles are thought to be fairly easily transferable into green industries – requiring little more than a few months of extra training.

But in the absence of government help, workers have been moving abroad, industry says, taking with them the expertise Britain badly needs to for its new greener energy system.

And it has left them feeling forgotten about after years of working to keep the lights on, and increasingly swayed by Reform UK, both GMB and Unite unions have warned Labour.

Pledge to double green jobs by 2030

Energy Secretary Ed Miliband told Sky News that creating jobs in sectors like carbon capture and storage and hydrogen would help “create a future for those in the North Sea communities”.

The new £18m will pay for careers advice, training, and “skills passports” to enable oil and gas workers to make the switch without having to repeat qualifications.

The cash was announced on Sunday in the new Clean Energy Jobs Plan, which details how the government hopes to make good on its promise to double green jobs by 2030.

Mr Miliband said in an interview: “This plan shows 400,000 extra jobs in the clean energy economy by 2030.

“This isn’t a target. This is actually what we believe is necessary to meet all the plans we have across the economy.”

The first strategy of its kind hopes to plug the UK’s massive skills gap that threatens to derail the government’s target to green the electricity system by 2030.

It identifies 31 priority occupations that are particularly in demand, such as plumbers, electricians and welders, and lists a target to convert five colleges into new “Technical Excellence Colleges” to train workers.

‘You can’t train people for jobs that aren’t there’

Unions welcomed the plan, but pointed out that skills and training do not equate to new jobs.

They say it will mean nothing without extra money and a revitalised domestic supply chain to build all the green technology needed, from fibreglass wind turbines to aluminium sub-sea cables.

Sharon Graham, the Unite general secretary who has threatened to cut ties with Labour over its policy to end North Sea oil and gas drilling and watering down of a ban on zero-hours contracts, welcomed the “initial steps” but called for “an equally ambitious programme of public investment”.

Professor Paul de Leeuw from the Energy Transition Institute in Aberdeen said the plan was “genuinely new and different”, and had for the first time joined up relevant information and strategies in one place.

But “you can’t train people for jobs that aren’t there”, he added, also calling for an investment plan.f

Reform heartlands could benefit from Labour’s jobs plan

The boom in clean energy jobs stands to benefit Reform heartlands along the east coast of Britain.

That fact is more by luck than design, given the east coast’s proximity to offshore wind farms and carbon capture and storage fields in the North Sea.

Reform promises a radically different vision for the country’s future, based on reopening coal mines and maxing out nuclear power and what’s left of North Sea oil and gas to boost jobs and the economy.

Its deputy leader, Richard Tice, objects to land being used for solar panels and pylons.

Government modelling forecasts an additional 35,000 direct jobs in Scotland, 55,000 in the East of England and 50,000 in the North West.

To keep the unions sweet, the government will also have to follow through on its pledge to boost the rights of those working offshore in green energy.

A current loophole gives protections like the minimum wage to oil and gas workers in UK territorial seas, but not to workers in the clean energy sector.

The former BT Group chief Philip Jansen is being lined up as the next chairman of Heathrow Airport as Britain’s biggest aviation hub prepares to deliver an expansion costing close to £50bn.

Sky News has learnt that Mr Jansen, who chairs the FTSE-100 marketing services group WPP, is in advanced talks with Heathrow’s board and shareholders about taking on the role.

If the discussions reach a successful conclusion, sources said an announcement could come within weeks.

Mr Jansen is said to have emerged as the frontrunner from a shortlist of candidates compiled by headhunters at Russell Reynolds Associates.

His experience as the boss of BT, a regulated utility, is said to have been key to his selection as the preferred candidate.

Mr Jansen has also run companies including MyTravel and Worldpay.

The appointment of a successor to Lord Deighton, who has held the post for nine years, comes at a critical time for Heathrow.

In August, the airport submitted a revised expansion plan consisting of a third runway costing £21bn, £12bn for a new terminal and stand capacity, and £15bn to modernise the current airport through the expansion of Terminal 2.

The existing Terminal 3 would ultimately be closed.

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Heathrow handled a record 83.9 million passengers in 2024 and is adamant that a third runway is essential to the growth of Britain’s economy, given the volume of exports which pass through the site.

“It has never been more important or urgent to expand Heathrow,” the airport’s chief executive, Thomas Woldbye, said in August.

“We are effectively operating at capacity to the detriment of trade and connectivity.

“With a green light from government and the correct policy support underpinned by a fit for purpose regulatory model, we are ready to mobilise and start investing this year in our supply chain across the country.

“We are uniquely placed to do this for the country; it is time to clear the way for take-off.”

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The expansion remains opposed by many airlines alarmed by the prospective increase in charges to use the airport, as well

It has, however, been backed by the government, with Rachel Reeves, the chancellor, saying that a third runway “would unlock further growth, boost investment, increase exports, and make the UK more open and more connected as part of our Plan for Change”.

Heathrow’s next chairman will lead a board dominated by representatives of the airport’s principal shareholders.

Mr Woldbye apologised in May for being asleep during the power outage in March which forced Heathrow’s temporary closure.

The airport said it would implement the recommendations of a review conducted by former transport secretary Ruth Kelly.

Heathrow’s search for a new chairman comes months after the most significant changes to its ownership structure in years.

Ardian, a French investment group, now owns 32.6% of the company following a series of transactions over the last 12 months.

Saudi Arabia’s Public Investment Fund has also become an investor.

Heathrow has never formally announced Lord Deighton’s intention to step down, other than a disclosure in its annual report in which he wrote:

“In light of the recent changes to the HAHL [Heathrow Airport Holdings Limited] board…the nominations committee…has asked me to extend my appointment for a limited period to help ensure a smooth transition whilst new non-executive shareholder directors become familiar with the business and a new chair is appointed.

“I have therefore agreed to extend my role as chair for a limited period to ensure continuity and stability on the HAHL Board during this period of transition.”

A Heathrow spokesperson declined to comment, while Mr Jansen could not be reached for comment.