The US-UK trade deal will lower prices and improve living standards - this is proof Labour’s approach works

8 May 2025, 21:19

In February, the UK economy grew by 0.5% - not just surpassing expectations but smashing them. In March, inflation fell faster than expected to 2.6%.

And today, we hear that the Bank of England has cut interest rates again, the fourth cut since Labour took office.

The evidence is mounting that Labour’s Plan for Change is starting to deliver, and the economy is turning a corner after years of mismanagement under the Tories.

Part of this plan is cementing our place in the world, as an economy that’s back open for business.

That’s why I welcome this week’s trade deals.

From the historic trade deal with India, to the announcement from the White House that the Government has successfully negotiated a trade deal with the US – with the Prime Minister delivering on his promise to protect UK steel and British car makers, as well as securing unprecedented market access for British farmers.

Tariffs on UK steel are now zero, car export tariffs will reduce from 27.5% to 10% and our farmers are set to benefit without breaching our red lines on animal welfare and food standards.

In the words of President Trump, “The US and UK have been working for years to do a deal and it never quite got there. It did with this Prime Minister”.

This is a far cry from the Conservatives, who couldn’t negotiate a thing because they had no economic strategy. Who oversaw fourteen successive interest rate increases, pushing up mortgages for millions of people, and where inflation surged into double digits.

Improvements in the economy and trade deals that add billions to our growth prospects matter for one reason: living standards. Economic growth for higher living standards is the defining mission of this Labour Government.

When deals are struck that lower prices and open up markets, we see Labour’s approach working. When mortgage rates are cut that reduce housing costs for millions, we see our approach working too.

This approach is guided by three words – set out ahead of the election by the Chancellor: stability, investment and reform. An economic plan that is the right one for Britain, and the only route to higher prosperity for everyone.

Of course the international outlook remains challenging. And the government finances are tight – we spend over £100 billion each year on the interest costs on government debt thanks to Liz Truss and the fourteen interest rate rises under the Conservatives.

But this government is gripping the problems the country faces, not ducking from them or avoiding the hard choices.

The Prime Minister set out our Plan for Change which drives Labour in government – higher living standards, improved public services and control of our borders. And with this focus, I’m confident that brighter days are ahead for the UK.

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Dan Tomlinson is Labour’s Growth Mission Champion.

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