London – The United Kingdom has been facing significant challenges in terms of economic growth and social cohesion, according to a recent study. The research, conducted by the University of California Los Angeles (UCLA) and the Hertie School in Berlin, Germany, highlights a decline in effective national governance as a major cause of these issues.
The report, released just weeks before the UK’s General Election on July 4th, warns that the incoming government will have to make up for lost time following a “lost” decade and a half since the 2008 global financial crisis. Urgent structural changes are needed to prevent severe problems from impacting the quality of life for citizens.
The study indicates that the UK’s governance has been among the highest performing in the world, but has shown signs of stagnation and erosion in recent years. The lack of state capacity to address pressing social and economic challenges has been a major contributing factor.
The research evaluated the last 14 years of Conservative rule using the Berggruen Governance Index (BGI), which measures the strength of democratic accountability and the capacity of government to function effectively. It identified a decline in government performance since the new millennium, with factors such as regional inequalities and lack of investment in infrastructure leading to a political backlash.
The report also points to political scandals, such as lockdown rule-breaking and breaches of parliamentary standards, as amplifying public discontent and leading to record low levels of trust in UK public institutions.
While the upcoming Labour government has prioritized economic growth with various pledges, the Institute for Fiscal Studies has accused both Labour and the Conservatives of ignoring difficult choices on spending. Despite the challenges, the UK still ranks high on the Berggruen Governance Index, but has seen a decline in state capacity between 2010 and 2021.
The report attributes this decline to a combination of austerity measures and political dysfunction, which has led to a lack of discipline and weaker governance structure. This has also left the UK with low productivity growth and stagnating gross domestic product. The lack of significant growth since the financial crisis has also resulted in high interest payments and exacerbated regional inequalities.
The report concludes that post-2010 austerity and the decision to leave the EU have left long-term scars on the UK economy and social cohesion. It calls for a reexamination of the reasons behind the erosion of state capacity and for the UK to take regional planning seriously.
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