BGN Entrepreneur

After official figures showed that the recession was biting far deeper than predicted, Alistair Darling claimed yesterday that UK would climb out of recession by the end of the year was in shreds.
Two days after the Chancellor told MPs that he expected the economy would have contracted by 1.6 per cent in the first three months of 2009, figures released by the Office for National Statistics revealed that it had shrunk by 1.9 per cent, which makes a difference of almost £1 billion. UK’s economy is now shrinking at the fastest pace in 30 years. The drop in the last quarter is the worst since 1979 and is the first time that the economy has shrunk by more than 1 per cent in two successive quarters ever since records began in 1948. The £924 million discrepancy blows a further hole in Mr. Darling’s claim that the economy will contract by 3.5 per cent this year. That prediction has already been rubbished by the International Monetary Fund and by City economists, most of whom believe the real figure will be 4 per cent worse. It also casts further doubt on the Chancellor’s claim that the economy will grow by 1.25 per cent next year, a year in which most economists believe that it will, at best, stagnate.
Taxpayers are facing bigger bills as recession bites depper.

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