Institute of Economic Affairs

Institute of Economic Affairs The IEA is the UK's original free-market think-tank, founded in 1955. No corporate view - sharing material from wide-ranging list of spokespeople.

25/09/2026

❓ Open borders or a welfare state? Milton Friedman said you can't have both: "I'm all in favour of immigration provided it remains illegal." Listen to more on this week's IEA Podcast 👇

📊 Julian Jessop, Economics Fellow, responds to today's Bank of England interest rate decision:"The MPC's decision to lea...
17/09/2026

📊 Julian Jessop, Economics Fellow, responds to today's Bank of England interest rate decision:

"The MPC's decision to leave interest rates on hold today was understandable but it also opens up the Bank to criticism that it is simply kicking the can further down the road.

"Inflation has been above target for most of the last five years and is not expected to fall back to 2% for at least another year.

"There are strong arguments against raising UK interest rates as far as the markets are currently expecting, including the weakness of the labour market and of broad money growth.

"But a small increase now might have helped to safeguard credibility and reduce the need for larger increases later."

17/09/2026

"This is where the axe has to fall."

Kristian Niemietz on the Guido Fawkes Show argues the recent surge in working age welfare spending, not pensions or the ageing population, is where cuts need to happen.

https://www.youtube.com/watch?v=Rx6X6kn-PuU&t=1s

📊 Valentin Boboc, Senior Economist, responds to today's figures showing UK inflation rising to 3.1%:"Inflation rising to...
16/09/2026

📊 Valentin Boboc, Senior Economist, responds to today's figures showing UK inflation rising to 3.1%:

"Inflation rising to 3.1% underlines the continuing squeeze on household budgets, with global disruption and pressures on food and energy supplies threatening further price increases.

"Ministers cannot control events abroad, but they can stop making essentials more expensive at home. Higher public spending risks adding to inflationary pressures. The government should instead cut the costs imposed by its own policies, from planning restrictions that hold back housebuilding to levies on energy bills and regulations that make doing business more expensive. Making essentials cheaper to produce and supply is the key to lasting relief."

📊 Valentin Boboc, Senior Economist, responds to today's ONS figures showing UK payroll employment down 145,000 in a year...
15/09/2026

📊 Valentin Boboc, Senior Economist, responds to today's ONS figures showing UK payroll employment down 145,000 in a year:

"Britain's labour market continues to weaken. Today's ONS estimates show payroll employment fell by another 26,000 in August, leaving 145,000 fewer employees than a year ago. Annual median pay growth has also slowed to 3.5 per cent.

"The weakness is being felt across the country. Payroll employment is down on a year ago in every nation and English region except Northern Ireland, with London recording a 1 per cent fall.

"Fewer people in work and weaker pay growth will also make it harder to grow tax revenues and repair the public finances. With the Budget approaching, the government should treat these figures as a clear warning against loading further costs and restrictions onto employers. Britain needs businesses hiring and investing, not being given more reasons to hold back."

12/09/2026

🚨 PM Andy Burnham: "Our national security can't come at the expense of social security."

But social security already costs the taxpayer 5x more than defence.
That means higher taxes, more borrowing or cuts elsewhere.

📊 Julian Jessop, Economics Fellow, responds to today's unexpected growth figures ahead of the Autumn Budget:"The UK econ...
11/09/2026

📊 Julian Jessop, Economics Fellow, responds to today's unexpected growth figures ahead of the Autumn Budget:

"The UK economy was still holding up better than most had expected in July, but this may just be the calm before the next storm.

The recent strength in services partly reflects some tailwinds that are already fading, including the initial boost to consumer spending from the hot weather.

The persistent weakness of the construction sector confirms that the Government has yet to 'fix the foundations'.

Other tailwinds may last longer, notably the surge in spending on AI-related goods and services. This goes some way towards explaining the recent improvements in some of the productivity data.

Unfortunately, any good news from two months ago is now being blown away by the fresh headwinds coming from energy prices and the bond markets.

The UK economy is still lurching from crisis to crisis. The surge in the cost of government borrowing will heap more pressure on the Chancellor, who is far more likely to respond by raising taxes further than by cutting spending.

It is also hard to see how the Bank of England can continue to keep official interest rates on hold when inflation is set to rise further above target.

The Government needs a much bolder strategy to boost growth by freeing up the supply side of the economy, rather than adding to the burdens of tax and regulation.

John Healey did say some of the right things in his 'Growth Speech' on Monday, but the gap between rhetoric and reality seems as wide as ever."

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