Britain could suffer a longer and deeper recession than has been officially acknowledged, Gordon Brown admitted yesterday.

Lending and retail figures released in recent days that were worse than expected have cast doubt on the Treasury’s forecast that Britain will start to recover in the second half of the year.

The prediction was described as optimistic by Barry Potter, a director of the International Monetary Fund, who said that the slowdown would be “a particularly sharp problem for the UK Government to handle in the next year or so”.

Mr Brown defended his efforts to bring Britain out of recession, insisting that it was too soon to assess the impact of the bank bailout and tax cuts announced in the autumn. Asked if the recession could last for two years, he said: “I think that depends on the level of international co-operation.”

In a second interview, he repeated that the length of the downturn would be influenced by the actions of other governments. “If we spend a pound in Britain, it can have twice the effect if other countries are doing the same. So we are trying . . . to get other countries to work with us.”

He accused the Conservatives of “revelling in things going wrong” and said that it was too soon to conclude that his £37 billion bank rescue had failed. “I do not think you can judge the success of recapitalisation by what happened in one month.”

But Chris Grayling, the Shadow Work and Pensions Secretary, cast doubt on Mr Brown’s claims. “Only last month he delayed his biggest public project, the new aircraft carriers, because the Government has run out of money. This is a Government that has got Britain into a major debt crisis and its solutions to the problems just aren’t working,” he said.

Later Alistair Darling confirmed that he was considering a second bailout for banks, as reported in The Times on Saturday. Among the options being studied are buying up banks’ “toxic assets”, offering cheaper state guarantees to enable them to raise private finance, or even injecting more public funds in a second round of recapitalisation.

Mr Darling played down — but did not rule out – the last option. “Recapitalisation is not your first port of call but over the next few weeks we will continue to discuss with banks what further steps we can take that would help lending, particularly to small and medium-sized businesses,” he said. “We have got to make sure these banks are strong enough in the first place – in other words, to help that recapitalisation process. But we also have to ensure there is enough money in the system so that businesses and people looking for mortgages can get the money.”

Mr Brown, who repeated yesterday a claim that 100,000 jobs would be created by fast-tracking public spending, said only a small fraction of an £18 billion boost for the economy had been spent. “If we have spent £1 billion of a total of £18 billion, some on public works, some on keeping people in their jobs, some on environmental and green projects, some on helping more people go to university and college . . . we have just started,” he said.

“You can’t judge a success or a failure by the first few weeks, you’ve got to judge it over the next few months.”

Asked if he could rule out a general election this year, Mr Brown said it was “the last thing on my mind”, adding: “I’ve got no plans for that.”

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