Figures confirm UK recession

Official statistics have confirmed that Britain is in recession.

Preliminary GDP data, published by the Office for National Statistics, showed that the UK economy shrank by 1.5 per cent in the final three months of last year.

The news follows figures which indicated that GDP contracted by 0.6 per cent in the previous quarter, having been at a standstill in the second quarter.

Friday's data means that the UK has experienced two successive quarters of negative economic growth and now meets the most widely-accepted definition of being in recession.

The ONS said the slowdown was "the result of both reduced services and production activity".

The volume of output in the production industries is estimated to have decreased by 3.9 per cent during the final quarter of last year.

Manufacturing output decreased by 4.6 per cent, while output from service industries is estimated to have decreased by one per cent.

The figures are set to deepen the economic gloom.

Data released by the ONS earlier this week showed that the number of people claiming jobseeker's allowance increased by 77,900 to reach 1.16 million in December.

And speaking on Thursday, David Cameron warned that Britain is running the risk of having to borrow billions of pounds from the International Monetary Fund to keep the economy afloat.

The Conservative leader said that the country could revisit "one of its darkest hours in the postwar period".

"If we continue on Labour's path of fiscal irresponsibility, at some point - and it could be very soon - the money will simply run out," he said.