More than £500bn of underinvestment by government and business over recent decades has left Britain’s economy trapped in a growth “doom loop”, according to a thinktank.
The Institute for Public Policy Research said the UK risked falling further behind comparable wealthy nations without a sharp turnaround in approach.
Business investment is lower in the UK than in any other country in the G7, and 27th out of 30 OECD countries, ahead of only Poland, Luxembourg and Greece.
IPPR’s research showed Britain had ranked below the G7 average since 2005 for spending on infrastructure, research and development, skills and training.
Had the UK maintained its position at the G7 average since that date, the private sector would have invested an extra £354bn in real terms. If public sector investment had also held that position, the UK government would have invested an additional £208bn between 2006 and 2021.
The centre-left thinktank said low investment put Britain at risk of being left behind in a global race to develop the green industries of the future, which are forecast to be worth $10.3tn (£8tn) to the global economy by 2050.
