UK limps out of recession by 0.1 per cent
Updated on 26 January 2010
As Britain's economy creeps back into growth - by the narrowest of
margins - does the UK now face the possibility of a double-dip
recession?
It is the day UK plc moved back into a period of growth; the much-awaited figures which tell us the worst is behind us and full recovery awaits. Except no-one is celebrating, least of all in Westminster.
The figures, released this morning by the Office of National Statistics (ONS), say it all. The economy expanded by a tiny 0.1 per cent in the last quarter of 2009.
It means the UK has barely crawled out of recession. The marginal growth between October and December did end a record six straight quarters of decline, but fell far short of the 0.4 per cent advance expected.
It is worth pointing out that the figure is only an estimate, and may be revised higher, but the result has been greeted with widespread disappointment.
Writing in his blog Channel 4 News economics correspondent Faisal Islam said: "It's entirely possible we could actually still be in recession, once further revisions are made in the coming weeks.
"An appalling number, saved by some growth in public sector and the motor retail trade. The breakdown of the GDP figure shows the recovery in construction has collapsed.
"This is totally consistent with the dreaded double-dip, except of course that presupposes that there has been some sort of peak from which the economy dips again. There really hasn’t been."
But chancellor Alistair Darling appears to be toughing it out. Speaking to Faisal Islam, he said: "It's taken us longer to come of recession because of the financial services industry.
"It's taken a real knock and it not surprisingly it has been holding us back.
"On the other side the manufacturing figures are better than people thought, the scrappage scheme, the time to pay for businesses, that has helped."
Britain's has been the longest, deepest recession of the leading western economies. It is officially the worst phase for the economy since records began in 1955.
Mr Darling added: "We're coming through the deepest downturn that the world has seen in modern times, that we've seen in modern times.
"It will take time. What we can say, though, is that we are now seeing evidence the economy is beginning to grow. It is inevitable the pace of that will start at the lower end of things.
"I believe that provided we keep the support in place, we will see that growth increase. Provided we can support our businesses, we'll get the growth, we'll get the jobs that we need in the future."
Channel 4 News political editor Gary Gibbon says the disappointing figures do little to bolster any of the political leaders in general election year.
He writes: "Who comes away with most egg on their face after a figure like that?
"Does it make Gordon Brown look a bit premature in announcing the country’s out of recession? Or does David Cameron now look daft for saying we're in the clear and should slam on the public spending cut brakes?"
He added: "What this estimate makes clear is that the Government is right to be confident but cautious about the prospects for the economy and that it is right that we keep supporting the economy."
