Politics

The key economic graphs that define 2023

Published

2 years ago

December 29, 2023

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How to sum up a year like 2023?

Perhaps the best thing to say is that it was considerably less exciting – as far as the economics went – than 2022.

And that’s probably no bad thing, because in 2022 much of what passed for excitement was extremely painful: the onset of a cost of living crisis which caused the biggest fall in British standards of living in modern record, a financial meltdown in the wake of Liz Truss‘s mini-budget.

The plan, when Rishi Sunak and Jeremy Hunt came into office, was always to make the economy boring again, and to some extent they succeeded.

Most obviously, while the government’s cost of borrowing did later rise to above the Truss era levels, it was largely down to higher inflation expectations and not to fears over the credibility of UK government policy.

This time last year, most people assumed – present company included – that 2023 would be a year of recession for the UK.

And for much of the year that’s precisely what it looked like.

France and Germany both tipped into technical recession (the definition of which is that you suffer two successive quarters of economic contraction). The UK was expected to do likewise.

Economic growth

But somehow, it never happened.

At least, not quite.

Instead, the economy more or less flatlined for most of the year – though figures published by the Office for National Statistics just before Christmas showed the economy contracted slightly, by 0.1% in the third quarter.

Either way, this can hardly be held up as a positive result. Normally you’d expect the UK’s gross domestic product to grow by around 2-2.5% each year.

However, a negligible amount of economic growth is more than most expected this year – even if (see below) it was helped by a colossal increase in migration.

Technically, this meant the prime minister met one of his much-publicised pledges he made to the country at the start of the year – to grow the economy.

As you can see from the chart, this isn’t much to boast about, especially set against the pre-pandemic path, but it is certainly better than what many other European countries experienced.

The Cost of Living

Another of the prime minister’s pledges was to halve inflation this year.

At the time he made it, this pledge looked pretty unspectacular, given a) controlling inflation is the Bank of England‘s task, not the government’s and, anyway, b) pretty much every economist was expecting inflation to halve this year anyway.

But over the course of the year inflation defied many of those economists’ forecasts, with the upshot that by the summer that pledge looked quite risky.

But then, no sooner had inflation surprised on the upside, it surprised on the downside, falling faster than most economists expected.

By the end of the year the consumer price index rate of inflation was down to 3.9% which is nearly in “normal” territory, albeit considerably higher than the Bank of England’s 2% target.

But while that meant the rate was indeed halved (actually more than halved) over the year, this hardly ends the cost of living crisis.

After all, inflation is simply the rate at which prices are changing each year. And right now prices are still 15% higher than they were a couple of years ago.

It’s that jump in levels which is causing severe economic hardship right now.

Life is not getting any less expensive. It’s just getting expensive a little slower than it was a year or so ago.

Interest rates

It’s tempting to lump interest rates along with the other things that didn’t turn out as bad as expected, but here the story is more complicated.

True: rates never rose to the 6% highs that were once expected around the time of the Truss mini-budget and also during the inflation spike during the Hunt chancellorship.

But they nonetheless rose far higher than most had expected at the start of the year, up to a peak of 5.25%. As the year ended, the Bank was still insisting that they would stay up there for some time (and some members were still voting for higher rates) but most investors believe they will be cut numerous times in the new year – down as far as 4% by the end of the year.

That has a bearing on the mortgage rates most of us pay, since fixed-rate mortgages are mostly priced off what’s going on in financial markets rather than the Bank’s official rate. The upshot was that the going rate for two and five-year fixed-rate mortgages were falling sharply by the end of the year.

Tax burden

Another hot topic this year was taxation.

The government insisted repeatedly that it wants to bring it down, and in the Autumn Statement, the chancellor announced a series of cuts to both workers’ taxes and taxes on business investment.

The upshot was that the tax burden wasn’t due to rise as high as it might otherwise have done.

However, the overall burden is still due to hit the highest level since the 1940s, in large part because of the fact that the levels at which people are pulled into higher tax bands has been frozen.

Higher wage inflation (due to the cost of living crisis) means more people are seeing their earnings taxed at those higher levels.

This so-called “fiscal drag” means the nation is shifting from being a medium-tax country to a high-tax country.

But so too are most developed nations, as the cost of running expensive healthcare systems rises, along with the average age of their populations.

Migration

While the government spent much of its energy talking about illegal immigration and the boats coming across the channel, the real quantitative story here was actually legal migration, which rose, according to the data released this year, to an unprecedented level of 745,000 in 2022.

That rise was extraordinary by any standards.

When looked at as a share of the population, it amounts to comfortably the biggest rise in net migration since records began. And, strikingly, experts said that this was primarily a consequence of the new rules brought in after Brexit, which made it easier for workers and students from outside Europe to come to Britain.

Migration might have been a big issue during the EU referendum, but the numbers today are considerably higher than they were back then – but Britain has swapped EU migrants with those from outside the continent – primarily from India and China.

Politics

US accuses UK of ‘significant human rights issues’ and restricting free speech

Published

1 hour ago

August 13, 2025

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US accuses UK of 'significant human rights issues' and restricting free speech

The US State Department has accused the UK of having “significant human rights issues”, including restrictions on free speech.

The unflattering assessment comes via a new version of an annual Human Rights Practices report, with its publication coinciding with Vice President JD Vance’s holiday in the Cotswolds.

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It says human rights in the UK “worsened” in 2024, with “credible reports of serious restrictions on freedom of expression”, as well as “crimes, violence, or threats of violence motivated by antisemitism” since the 7 October Hamas attack against Israel.

On free speech, while “generally provided” for, the report cites “specific areas of concern” around limits on “political speech deemed ‘hateful’ or ‘offensive'”.

Sir Keir Starmer has previously defended the UK’s record on free speech after concerns were raised by Mr Vance.

In response to the report, a UK government spokesperson said: “Free speech is vital for democracy around the world including here in the UK, and we are proud to uphold freedoms whilst keeping our citizens safe.”

The US report highlights Britain’s public space protection orders, which allow councils to restrict certain activities in some public places to prevent antisocial behaviour.

It also references “safe access zones” around abortion clinics, which the Home Office says are designed to protect women from harassment or distress.

They have been criticised by Mr Vance before, notably back in February during a headline-grabbing speech at the Munich Security Conference.

The report also criticises the Online Safety Act and accuses ministers of intervening to “chill speech” about last summer’s murders in Southport, highlighting arrests made in the wake of the subsequent riots.

Ministers have said the Online Safety Act is about protecting children, and repeatedly gone so far as to suggest people who are opposed to it are on the side of predators.

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The report comes months after Sir Keir bit back at Mr Vance during a summit at the White House, cutting in when Donald Trump’s VP claimed there are “infringements on free speech” in the UK.

“We’ve had free speech for a very long time, it will last a long time, and we are very proud of that,” the PM said.

But Mr Vance again raised concerns during a meeting with Foreign Secretary David Lammy at his country estate in Kent last week, saying he didn’t want the UK to go down a “very dark path” of losing free speech.

The US State Department’s report echoes similar accusations made by the likes of Nigel Farage and Elon Musk.

The Trump administration itself has been accused of trying to curtail free speech and stifle criticism, most notably by targeting universities – Harvard chief among them.

Politics

Facial recognition vans to be rolled out across police forces in England

Published

1 hour ago

August 13, 2025

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Facial recognition vans to be rolled out across police forces in England

The police’s use of facial recognition technology is to be significantly expanded in an attempt to catch more offenders, ministers have announced.

Under the plans, 10 live facial recognition (LFR) vans will be used by seven forces across England to help identify “sex offenders or people wanted for the most serious crimes”, according to Home Secretary Yvette Cooper.

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The tech, which has been trialled in London and south Wales, will be subject to strict rules, the Home Office said, but human rights groups have warned it is “dangerous and discriminatory”.

Amnesty International UK said the plans should be “immediately scrapped”, with facial recognition proven to be “discriminatory against communities of colour”.

“It has been known to lead to misidentification and the risk of wrongful arrest,” said Alba Kapoor, the charity’s racial justice lead, “and it’s also known to be less accurate in scanning the faces of people of colour.”

The Home Office said the LFR vans will only be deployed when there is “specific intelligence”, and will be operated by trained officers who will check every match made by the cameras.

The vehicles will also only be used against bespoke watch lists, compiled for each use under guidelines set by the College of Policing.

The vans will be operated by police forces in Greater Manchester, West Yorkshire, Bedfordshire, Surrey and Sussex (jointly), and Thames Valley and Hampshire (jointly).

‘The most serious offenders’

Ms Cooper has said ministers are focused on making sure “there are proper safeguards in place”.

As part of the plans, the home secretary has announced she will be launching a consultation on how and when the cameras should be used, and with what safeguards, which the government will use to draw up a new legal framework for the use of the cameras.

Ms Cooper said the tech had been used in London and South Wales “in a targeted way”, and helped catch “the most serious offenders, including people wanted for violent assaults or for sex offences”.

According to the Metropolitan Police, the tech has led to 580 arrests for offences such as rape, domestic crime and knife crime in the space of 12 months.

The government has pointed to independent testing by the National Physical Laboratory, which it said found the tech was “accurate” and showed “no bias for ethnicity, age, or gender”.

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Liberty has welcomed the government’s decision to create a statutory framework for using facial recognition, but said that should be in place before the tech is rolled out.

“There’s no reasonable excuse to be putting even more cameras on our streets before the public have had their say and legislation is brought in to protect all of us,” said a statement.

The civil liberties charity cited how more than 1.6 million people have had their faces scanned in South Wales, mostly on football match days in Cardiff city centre.

But Lindsey Chiswick, from the National Police Chiefs’ Council (NPCC), has said the expansion “is an excellent opportunity for policing”, and will help officers locate suspects “quickly and accurately”.

Politics

Police ordered to consider revealing ethnicity of suspects

Published

1 hour ago

August 13, 2025

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Police ordered to consider revealing ethnicity of suspects

Police should consider disclosing the ethnicity and nationality of suspects when they are charged in high-profile and sensitive cases, new national guidance says.

Coming into force today, it says there must be a policing reason to release the information, such as where there are high levels of disinformation, if it will improve public safety, or if it is significantly in the public interest.

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A Home Office spokesperson told Sky News they will support the new guidance by authorising the release of relevant accompanying immigration information if appropriate.

The change comes after two men charged over the alleged rape of a 12-year-old girl in Nuneaton were reported to be Afghan asylum seekers, sparking protests.

Warwickshire Police did not confirm the immigration status, leading to Reform UK accusing them of a “cover-up”, something the force strongly denied.

Responding to the row, Home Secretary Yvette Cooper said last week she wanted police to be more transparent, and that new guidance was being worked up.

How high-profile cases sparked debate

When considering what information to release, police must consider contempt of court laws which aim to give defendants a fair trial, as well as media guidance from the College of Policing.

Until now, the media guidance said once a suspect has been charged, police can give out information such as their name, date of birth and address. It did not mention anything about ethnicity, nationality, or immigration status.

The Southport murders committed by Axel Rudakubana last July led to speculation about his ethnicity and immigration status, fuelling riots in many parts of the country.

While the details were not initially released in that case, when a car ploughed into crowds celebrating Liverpool’s Premier League win earlier this year, Merseyside Police were quick to say the suspect was a white British man.

In the Nuneaton case, Reform leader Nigel Farage said retaining the “basic and sober facts” was “a cover-up that in many ways is reminiscent of what happened after the Southport killings”.

Warwickshire Police said officers “did not and will not cover up such criminality”, and followed national guidance.

How will new guidance work?

The new guidance says it is at the discretion of the police force to decide whether to release ethnicity and nationality details, and that they must consider the ethical and legal implications.

It says it is not the job of police to verify a suspect’s immigration status, which rests with the Home Office.

The advice has been developed by the National Police Chiefs’ Council (NPCC) and the College of Policing, in consultation with the Home Office and the Crown Prosecution Service (CPS).

Deputy chief constable Sam de Reya, the NPCC lead for communications and media, said: “We saw during last summer’s disorder, as well as in several recent high-profile cases, what the major, real-world consequences can be from what information police release into the public domain.

“We have to make sure our processes are fit for purpose in an age of social media speculation and where information can travel incredibly quickly across a wide range of channels.

“Disinformation and incorrect narratives can take hold in a vacuum. It is good police work for us to fill this vacuum with the facts about issues of wider public interest.”

‘A chilling message’

The guidance is interim, and will be considered as part of a wider review of the College of Policing’s authorised professional practice for media relations later this year.

Chief constable Sir Andy Marsh, the college’s CEO, said officers will continue to police “without fear or favour”.

But the guidance is likely to provoke backlash from anti-racism campaigners. Last week, the Joint Council for the Welfare of Immigrants warned that revealing ethnicity and migration status would “send a chilling message: that some people are inherently more ‘suspect'”.

‘Public trust requires transparency’

A Home Office spokesperson told Sky News they welcome the new guidance, adding: “Public trust requires transparency and consistency from the authorities that serve them.”

They added: “The public, and police forces themselves, want greater clarity on when, why and how information is released and the legitimate and compelling reasons it may need to be withheld.

“The Home Office will support that effort by authorising the release of relevant accompanying immigration information in future cases, where it is appropriate to do so, and where the police have requested it. All cases will of course take account of consultation with the police and CPS.

“The government also asked the Law Commission at the end of February to speed up the elements of its review around the law of contempt in relation to what can be said publicly ahead of a trial.”