Business investment growth in Brexit Britain in real terms soars to highest rate in 25 years

It’s up by 9.2% in the last year alone – how do Rejoiners explain this?

Montage © Facts4EU.Org 2023

Brexit Facts4EU looks at the latest business investment data – Rejoiners should look away now

At the end of last week the Office for National Statistics (ONS) released its revised figures for business investment in the UK. These show exceptional growth. Not only is the growth rate higher than a year ago, it is higher than before the Referendum and on a quarterly basis is at its highest level in over 25 years.

Given that the BBC seems reluctant to spread the good news, the Brexit Facts4EU think-tank team felt readers might want to see a summary, written for non-economists.

Brexit Facts4EU.Org Summary

Business investment in the UK: April to June 2023 revised results

(After taking out the effects of inflation)

UK Business investment increased by 4.1% in Quarter 2 (Apr to June) 2023
Business investment has grown by 9.2% compared with the same quarter a year ago
The rate of growth is accelerating
It is now at its highest level in over 25 years, adjusted for inflation

[Source: Office for National Statistics, 29 Sept 2023.]

UK Business investment increased by 4.1% in Quarter 2 (Apr to Jun) 2023, revised up from the provisional estimate of 3.4% growth, with upward revisions from transport, intellectual property products, and information and communication technology, and other machinery and equipment.

These revisions are the result of later survey data. Business investment has grown by 9.2% compared with the same quarter a year ago.

The Rt Hon Sir John Redwood MP commented on our report this morning

"The UK needs to grow more and produce more at home. Out of the EU we can now make laws and regulations that allow us to grow more food, rebuild our fishing industry, lower taxes and rules which have been closing our energy using industries and making us less competitive. Good that business investment is up.
Bring on the supply side Revolution."

Brexit Facts4EU.Org Summary

On an annual basis this is the fastest growth rate since 2005

(In real terms again, subtracting inflation)

2006 : -4.6%
2007 : 8.7%
2008 : -3.4%
2009 : -16.8%
2010 : 4.3%
2011 : 6.0%
2012 : 7.0%
2013 : 3.6%
2014 : 5.5%
2015 : 9.4%
2016 : 6.9%
2017 : -0.2%
2018 : -1.6%
2019 : 2.1%
2020 : -10.6%
2021 : 2.0%
2022 : 9.6%

[Source: Office for National Statistics, 29 Sept 2023.]

International comparisons of gross fixed capital formation for the G7 nations

When it comes to what is known as “gross fixed capital formation” (GFCF) which includes public investment, we have more bad news for Rejoiners.

GFCF in the UK increased by 0.8% in Q2 2023. This is the second-largest of the G7 nations, surpassed only by the United States. This has been ratified by the anti-Brexit Paris-based Organisation for Economic Co-operation and Development (OECD).

Observations

Brexit Britain continues to soar

This is yet more good news for Brexit Britain, once again defying the projections of economic apocalypse from the Remain-Rejoin lobby.

For business investment to be rising at the highest rate in 18 years is a testament to the confidence the business community has in the United Kingdom.

We have to say it is a great shame that the Government is still not taking advantage of our new-found freedoms. Progress has been pitifully slow and limited in scope. On top of that they have increased corporation tax by 30%, just at a time when it should be decreased to encourage the growth which the Chancellor says he wants.

As Sir John Redwood MP points out in our Independence Documentary post-première Expert Panel film, to be released this coming weekend :

“There is one way in which I would be delighted if our politicians will align more strongly with the Republic of Ireland, and that is why don't we have their corporation tax rate? Because by having a corporation tax rate at half the United Kingdom level, they collect four times as much company tax per head than we do.
And yet the Treasury tells me that if you cut tax rates, you collect less revenue.”

As a non-partisan organisation we would simply say that if a Government of any political hue wishes to raise more tax revenues in order to pay for the current (and profligate) public spending levels, then it should lower the rate of corporation tax to 15%.

Regardless of this, however, we are pleased to bring readers this excellent Brexit news which they will not have seen on the BBC.

We must get reports like this out there

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[ Sources: Office for National Statistics | OECD ] Politicians and journalists can contact us for details, as ever.

Brexit Facts4EU.Org, Fri 06 Oct 2023

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Reader Comments 8

1. Sparky , Friday, October 06, 2023, 12:21:

Selective data. Investment is good but coming from a low base and 9% is flattering.
.
From the Guardian: The 9% year-on-year increase to the end of June was lifted by exceptional investment from aerospace firms in new planes and a generous tax break that ran out in April.
.
according to a survey by the British Chambers of Commerce UK businesses are reluctant to make large investments in machinery and new technology while barriers to trade with the EU remain in place and interest rates are high.
.
CBI said the vast majority of respondents to its quarterly economic survey had frozen or cut investment plans while only 23% said they were considering fresh injections of cash to improve the way they operated. A pause in business investment dating back to the Brexit vote in 2016 was still in place, 59% of the 5,000 respondents reported no change and 18% saw a decrease.

2. Northern Muppet , Friday, October 06, 2023, 13:03:

Facts versus reports, opinion and speculation, sparkless!!
.
Like your citing the BBC recently, the BCC (famously!) and the CBI are very much on one side of the fence. Perhaps you could add some opinion from the Bank of England for a bit of balance?? But then even arch-remaintard, Andrew Bailey, is now admitting to the benefits of Brexit!!
.

3. Sparky , Friday, October 06, 2023, 13:39:

2 NM. That's another convenient miss quote that the likes of the DE and DM have jumped on. Picking up the salient points, what he said was:
.
"the short-term consequences of the UK leaving the EU are indeed negative. “If you reduce the openness of an economy, in the short run it will have negative effects. It will have a negative effect on productivity, it will have a negative effect on growth. In the longer run, you know, those trading relationships adjust in the real economy and we build new trading relationships… But in the short run there’s a misalignment.” Leaving aside this “misalignment”, Bailey says he is an inherent optimist about the UK’s post-Brexit prospects. Financial services, for example, offer a bright spot. Despite “pretty dire” predictions about damage to the City of London, much has remained intact. While he does not want to trivialise or ignore the fact that there has been some damage, it’s not a slow puncture".
.
So essentially there is relief that the damage hasn't been as bad as expected. On benefits maybe he is thinking of JRMogg who said (after the referendum) that the benefits of Brexit could take up to 50 years.

4. Gazzablack , Friday, October 06, 2023, 15:13:

3 sparkless
That's a bit rich coming from you, the 'misquote, and quote out of context champion of the year'.

5. Adam Hiley , Friday, October 06, 2023, 16:01:

Shame facts4eu cannot seem to blacklist sneering Remoaners like Sparky I bet they hope Sir Sneer Starmer becomes PM for all our sakes let's hope the pro-EU anti-British Labour party are kept well away from office despite the woefulness of the current Government I get quite irritated by Remoaners futile attempts to keep the UK attached to a EU that's sclerotic

6. jon iivesey , Friday, October 06, 2023, 16:23:

The World Intellectual Property Organization (WIPO) just released its ranking of innovative nations, and the UK is at fourth, behind Switzerland, Sweden and the US. Germany was eighth.

7. jon iivesey , Friday, October 06, 2023, 16:27:

5. Adam Hiley , "Shame facts4eu cannot seem to blacklist sneering Remoaners like Sparky..." Personally, I hope they don't. Just as there is no light without darkness, there is no real satisfaction in Brexit without people like Sparky sneering and being proved wrong.
It reminds me of my parent's generation telling me that they amused themselves during the War by comparing German propaganda with what actually happened.

8. jon iivesey , Friday, October 06, 2023, 16:40:

1. Sparky , "Selective data. Investment is good but coming from a low base ...."
Nope, not true. The previous year's increase was 7% and the one before that was 4%. Now *you*, Sparky, have been telling us for several years that investment was "flatlining" which is apparently one of your favourite words, since you use it quite a lot, but that hasn't been true for years. You simply did not update your ideas and you post as if investment today is the same as it was during Covid, which just isn't true. In fact we have had several years of significant increases since then.
And this is one of your bad habits as a poster, which makes people doubt your word. You get hold of some issue and then post the same jibes literally for years as if nothing has changed. Things do change.

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