Authority shaken, Boris Johnson pitches new plan for UK economy

LONDON: Rocked by a major revolt against his leadership this week, British Prime Minister Boris Johnson will on Thursday promise to rejuvenate a flagging economy and make it easier for young people to buy homes.

Johnson will pledge "fiscal firepower" to help ease a worsening cost-of-living crunch for households, in his first policy speech since Monday's vote of confidence in which 41% of his own lawmakers voted against him. Previous Conservative prime ministers who did better in such votes have been subsequently ousted.

Johnson's announcement follows downgrades to UK growth forecasts from both the British Chambers of Commerce (BCC) and the Paris-based Organisation for Economic Co-operation and Development (OECD), who predict stagnation ahead.

"Over the next few weeks, the government will be setting out reforms to help people cut costs in every area of household expenditure, from food to energy to childcare to transport and housing," Johnson will say during a visit to the northern English county of Lancashire, according to excerpts of his speech sent from his office.

The prime minister will also address falling rates of home ownership, especially among young people, his office said.

Lawmakers in Johnson's party called Monday's confidence vote after scandals over COVID-19 lockdown-breaking parties at the heart of government.

While Johnson's integrity lies at the heart of the issue, questions over his government's economic record have also grown.

The OECD sees zero growth next year - the weakest of any G20 economy apart from Russia - while the BCC sees Britain's economy shrinking 0.2% in the final quarter of this year before growing just 0.6% in 2023 and 1.2% in 2024.

"The downgrade reflects heightened political and economic uncertainty, and rising cost pressures which are limiting smaller firms' abilities to invest," the BCC said.

Johnson will say on Thursday that the government will cut costs for businesses and households.

"With more affordable energy, childcare, transport, and housing we will protect households, boost productivity and above all increase the rate of growth of the UK," he will say.

The opposition Labour Party said Johnson was deluded.

"No wonder he is unwilling to face the reality that economic growth in the UK will grind to a halt next year," Labour lawmaker Tulip Siddiq said of Johnson's planned speech.