Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of economic data for 2023 issued by the International Monetary Fund and the Organisation for Economic Co-operation and Development showing that GDP per person in Germany was 15 per cent greater than in the United Kingdom, and that GDP per hour worked was 20 per cent greater; and whether they have identified any reasons for these disparities.

As was the case in many advanced economies, the UK experienced a slowdown in productivity growth following the Global Financial Crisis, but this was sharper than for our peers.

HM Treasury published analysis at the Budget in October 2024 [1] , showing that under the previous government UK productivity growth fell to the second slowest in the G7 – lower than France, Germany and the US. This is also reflected in national data collated by the IMF and the OECD.

The UK’s productivity gap with Germany is largely explained by lower levels of capital per worker and weaker total factor productivity.

Increasing productivity is vital in driving economic growth and improving the living standards of working people. That is why growth is the priority mission of this government and why we continue to take steps to boost productivity.

This includes increasing the capital envelope by over £100 billion at Autumn Budget 2024 and a further £13 billion at Spring Statement. Additional capacity announced at Spending Review 2025 and the 10 Year Infrastructure Strategy has allowed the government to increase the capacity of Public Financial Institutions by around 60% this Parliament, to £153 billion. We are also removing barriers to investment through ambitious planning reforms, and championing growth-enhancing sectors through our modern Industrial Strategy.

[1] Box 1.A UK growth performance since the GFC - Autumn Budget 2024 – HC 295