The Lib Dems recently announced plans for a Department for Growth. I can agree with splitting the Treasury into finance and “strategic economy” departments. But the messaging doesn’t suggest that our party is that keen on challenging (or being seen to challenge) the economic status quo: an economic system which is not working for too many people nor the environment.
Challenging the economic system does NOT mean de-growth. It does mean challenging and moving away from GDP and growth – regardless of what, where, and for who – being the ultimate aims. “Growth agnostic” is the technical term. But more clearly, it means that it shouldn’t matter if we grow GDP or not, because we measure our success based on what genuinely matters for people and nature. GDP becomes one of many metrics and levers, but not the overarching objective.
What separates us from the Greens in the minds of the many sustainability professionals I meet is that we have vision AND the plans to match. We’re at risk, not least because we have so many current MPs facing the conservative party, of limiting those visions and plans for what society could be.
There is a (personally conflicting and valid) conversation to be had as to whether stopping Reform, the Conservatives, and their hate-filled divisive politics is so important that we ensure we win, where we currently get our best results, with more cautious politics – enough to make sure there’re enough Lib Dem MPs to group with Labour and the Greens after the next election.
But for the sake of this article, and in hope that we can do better than cautious, let’s be ambitious enough to manage these conflicts and nail the best of all worlds. Especially as our “Thriving Economy” working group comes up with our new economic policies that will take us into the next general election and might very well make it into some form of government.
I’ve written recently that two things must happen in 2026 to accelerate the move away from GDP and growth-at-all-costs toward judging society based on what matters for people and the environment.
- Clarity on the end point and principles of a new economic vision: which we have, in so many different forms that I discuss in the articles linked throughout this piece, like Natural Capital (alongside Human and Produced Capital), Doughnut Economics, Missions (I know…), SDGs, GEP, and countless other frameworks, metrics, and philosophies. We need to align. The promising UN High Level Expert Group on Beyond GDP is working on this right now.
- A transition plan for that new economic vision: How do we unpick the current economic system from inside itself? And build a step-by-step path from now to that end point. With core principles that allow continuous improvement even after the economy is measured differently. Principles that allow flexibility far beyond a rigid plan. An approach that also wins the political conversation, as well as proving that a new economic approach can work for people and the environment, as well as working within the current system. We have gotten this roadmapping approach right before, for example in our 2024 EU policy and 2019 decarbonization plan. (The latter, alongside the people, was a big reassurance that I’d joined the right party in 2019!)
For a longer read on the indicators, frameworks, philosophy, liberalism, tipping points ahead, communication challenge, see again this Critical Mass for Sustainability piece and broader article library.
In summary, a transition plan to that new economic vision must:
- Start the conversation: get the communication right, and win the argument by adding new metrics alongside GDP, growth, and other traditional economic numbers.
- Define the vision and tell the story: based on that outline of new and old economics and how they interplay. We’ll see what the UN Group comes up with. There’s so much out there already to draw from.
- Outline the transition step by step: keep coming back to the roadmap and progress. With concrete actions, plans, and policy. Both what is working in the current system, and what needs further progress and broader systemic change.
New Economies for Eradicating Poverty (NEEP) is a great starting point that outlines many of the concrete policies needed to transition to a new economic model or just build a fairer society within the current one.
What can the Liberal Democrats do?
Our Thriving Economy working group must outline an economy where people and the planet thrive.
We must challenge the underlying assumption that GDP sits above all else. Especially as war, disease, injury, nature destruction, and much more we all agree is best avoided, can actively “improve” GDP.
We don’t need to abandon growth. It must however be growth of the right things for people and the environment. Our Department for Growth plans can meet that challenge. But we need to refine and clarify that vision – the growth of what, where, and for who? – and get our plans right.
This article is written in the lead up to York Spring Conference 2026, with an ongoing Thriving Economy working group, consultation in York, my own recent election on the party Federal Policy Committee (FPC), and a series of “new economy” Fringes in York from the Social Liberal Forum and Green Liberal Democrats on Saturday March 14th.
This article also draws on two recent Critical Mass for Sustainability articles, each with a deep chest of references for further reading.
* Josh works on climate and sustainability across research, consulting, convening, and advocacy, focusing on the systems change and economics we need. He is the Lib Dem candidate for Mayor of Lewisham and Catford South. Josh is also a member of the Lib Dem Federal Policy Committee (FPC). He is a former PPC and Cambridge City Councillor with the opposition portfolio for Climate, Environment, and the City Centre.
Follow @libdemvoice.org on Bluesky
Like us on Facebook
Subscribe to our feed
Sign-up for our daily email digest
We have no idea what history will say about Keir Starmer and it may not be right anyway
Is Kier Starmer the new John Major?
A bargain at 23 guineas?
20C night
Jana
Peter Black
Nigel Quinton
Chris Cory
10 Comments
The GDP per person in the UK is projected to be $60k per person this year. So it is reasonable to ask why we need it to be even higher in 2027.
I don’t see the word “redistribution” anywhere in this OP or the linked articles. But if we are to move to a zero growth economy we do need it in both incomes and wealth.
This article is full of platitudes and vague ambitions. Everybody and their dog knows that GDP is a pretty inaccurate measure, but one inconvenient fact remains. For the foreseeable future there will be pressure on governments to increase spending on a range of things, NHS, education, infrastructure and, yes, defence. Money will have to be found, and presumably a fair proportion of that money will come from taxation. How do you increase the tax take without increasing economic activity ? Of course we can increase taxes on the super rich but whether or not you believe in the Laffer curve, that is only a short term partial solution. So could you answer the following question questions ? In this brave new world, do you envisage public spending being higher, lower, or the same as today ? If it’s the former, how is it funded in a static, growth less economy ?
@ Josh Matthews, “But the messaging doesn’t suggest that our party is that keen on challenging (or being seen to challenge) the economic status quo: an economic system which is not working for too many people nor the environment”.
Oh, dear, that’s not what I was told and what we believed when I joined the Liberal Party way back in 1961. According Jo Grimond, our then Leader, “We in the Liberal Party are members of a radical party, a party of reform.”…… reform used in its proper progressive sense in the days before Farage parasited the language and profited from crypto currency.
Social justice and redistribution doesn’t necessarily depend on growth, and there’s certainly no attraction or benefit from being a mini version of the Tory Party.
There is an Irish saying, ” if I was going there I wouldn’t start from here”. Too often, we let that be a reason for not starting at all.
Let’s start from the most important fact. The planet is being destroyed by the economic systems of human beings and we know that unrestrained growth is no longer possible. So, the idea that we can sort everything out via growth is clearly nonsense.
Yes, we want and continue to promise improvements to public services and pretend that can happen without tax increases. We accept the notion that tax is too high and that taxing the very rich is not possible, or at least we have allowed ourselves to be cowed by the power of the ultra rich.
Peter Martin is right to point out the importance redistribution of income and wealth. Between 1910 and 1979 the UK used the tax system to greatly reduce income and wealth inequality and we will have to do so again.
We will never make real progress as a country (form indeed a planet) if we don’t tackle the huge disparities of income and wealth that started with Thatcher/Reagan and co in 1979. We can do that better in cooperation with other countries and tackling the disgrace of tax havens.
It may be possible to have limited ‘Green’ growth, but the truth is that we can’t go on squandering the planet’s resources. We must face up to the challenge of redistribution and taxing the rich.
GDP is a measure of the value of the goods and services produced in a country in a year. A rising GDP means that the country has greater capacity to meet the needs of its people, unless the population is increasing at a faster rate. So, are we planning to aim for zero growth in GDP per head or in the level of GDP itself? If the latter, we will have to ensure that our population does not increase – perhaps with some strong restrictions on immigration/asylum seeking – or we would face falling GDP per head.
Considering that most voters will be unwilling to vote for any party intending to make them poorer, I trust some political realism will enter this discussion.
Tax plays a part of this indeed. And regulation. A reason why the tax base is shrinking is profits from operations in the UK going offshore. We are a developing country and we are developing some other people. But they rely on loopholes that HMG is pleased to grant. However if this tax loss is stemmed then expect huge pushback. Political donations multiplied. So first fix foreign political interference laws. Then look at tax and regulation. Then check the entry “uninvestible” in the dictionary.
Thank you for an interesting and considerably researched article.
Might the matter of money distribution be of no less importance than growth?
As G D P includes money coming from beneficial inputs to society and harmful extractions, such as excessive financial extractions, might the L. D leadership obtain an alternative to G. D. P which presents both basic types of money movement?
Might the L. D leadership recognise that our current tax set up is neither transparent nor fair?
@ Joan,
“GDP a measure of the value of the goods and services produced in a country in a year.”
It’s actually a measure, the sum, of all financial transactions. So, for example, if someone pays a childminder this will count towards GDP, but if the child minder does it for free or on a reciprocal basis it won’t. The latter is usually the way it works in so-called less developed societies. Not just with child care but everything else too. Everything is organised far more collectively.
Capitalism, though, tends to turn goods, services, and even human labour into commodities—things to be bought and sold via a monetary transaction. This focus on monetary value can cause individuals to feel alienated from their work and each other, as relationships become defined by money rather than direct human connection.
So we perhaps should ask which is the more natural way to live? Then how we might move back more towards what used to be the norm?
Whatever the merits of limiting growth and redistribution, getting to net zero as soon as ever possible is a key art of the solution whatever it is.
Essentially those who don’t want to bother with net zero are arguing that it’s too expensive.
Here’s a report (being publicized by Pippa Heylings inter alia) arguing that the costs of getting to net zero by 2050 are less than the costs of an oil shock, so it’s pretty topical: https://www.theccc.org.uk/publication/supplementary-analysis-of-the-seventh-carbon-budget/
It may be that a benefit of the horrible situation in the Middle East and the resulting damage the world economy show that Trump/Putin etc provide another reason to move away from a hydrocarbon based economy as quickly as possible. You have to find your silver linings where you can.
This past weekend, I had a few discussions with various people about what “growth” or “GDP” is and whether it is a good measure or not (I am one of the Founders of “Lib Dems for Growth”).
In short, GDP is fine.
Growth in GDP per capital broadly correlates to increasing tax revenues per capita. We need this to pay for the many, many things we want to do.
Growth in GDP per capital also correlates to rising real incomes.
We have not had these things for the last 15+ years.
These are the main things voters want.
Sometimes things are not that complicated.