The UK's economy is trapped in a growth 'doom loop' because of half a trillion pounds’ worth of underinvestment by Government and business, the Institute for Public Policy Research has warned.
The think tank says 'investment phobia' risks the country falling further behind comparable wealthy nations.
It said business investment is lower in the UK than in any other country in the G7, and 27th out of 30 OECD countries.
The institute's research showed the UK has ranked below the G7 average since 2005 for spending on infrastructure, research and development, skills and training.
The IPPR said increased public investment could 'crowd-in' private sector investment and give confidence to companies to choose the UK as a place to build the green companies of the future, as long as the Government invested 'with a sense of longevity and certainty'.
George Dibb, an associate director for economy at IPPR, said: 'The Us tank is running on empty and it’s harming economic growth, driving inequality and slowing progress towards net zero and energy security.
'Currently the UK is experiencing a debilitating case of investment-phobia, and the Government’s aversion to investing to seize future opportunities is stopping us from getting out of the growth doom loop we find ourselves in.'
