I’ve been listening to Rachel Reeves talk about the economy, and I’ll be candid: I think she’s painting a rosier picture than the data supports. Maybe it’s required politics; chancellors can’t talk down the economy; but there’s a gap between what she’s saying and what people are experiencing.
She’s been talking about growth prospects, recovery, things improving. And sure, there will be growth. Economies don’t stay flat. But the pace of improvement matters, and whether it reaches people matters more.
In Scotland, businesses are managing but not thriving. Households are stretched. Energy bills have come down from the peak, but they’re still elevated compared to historical norms. The cost of living hasn’t returned to where it was. People are managing, but they’re managing by cutting discretionary spending.
The spring forecast from the independent forecasters is a bit more measured than Reeves’ rhetoric. They expect modest growth, not recovery. Inflation’s coming down but not to target. Employment’s solid but not expanding fast. These are not the preconditions for a meaningful improvement in living standards.
For Scotland specifically, the challenge is that monetary or fiscal policy is not controlled locally. Scotland is subject to UK wide decisions made in Westminster. If those decisions are slower to improve living standards than Reeves is suggesting, Scotland’s stuck with the consequences.
Scottish Government can do things at the margins; invest in infrastructure, support business, make budget choices. But the real economic drivers are UK level policy, and I’m not convinced that’s being handled with the realism the situation requires.
So Reeves is talking about spring recovery and growth prospects. I’m hoping she’s right. But I’d be happier if she acknowledged the gap between the optimistic projection and what’s actually happening on high streets and in households right now.