Robin Pagnamenta
Win VIP tickets
Alistair Darling has admitted that Britain is “far from through” the recession and hinted that the Government is preparing to ditch its forecast for a recovery in the second half of this year.
In remarks made to the Financial Times, Mr Darling suggested that the Treasury’s most recent assessment of the economy, made at the Pre-Budget Report in November, may have been overly optimistic and might need to be revised at the spring budget.
At the time, Mr Darling suggested that the UK economy would be, by now, half way through a recession and would begin to see recovery in the second half of 2009.
The Chancellor also said in November that GDP would return to growth of between 1.5 per cent and 2 per cent in 2010.
Today, however, Mr Darling said those predictions had been based “on the evidence we had at the time”, adding: “This year is going to be difficult. There are going to be some tough calls.”
“In the current climate, no responsible finance minister could say that’s the job done, far from it. We are far from through this.”
His comments emerged ahead of the Bank of England's interest rate decision tomorrow when it is widely expected to slash borrowing costs by between 0.5 per cent and 1 per cent to their lowest level in history.
The Chancellor also said he was examining fresh measures designed to stimulate the UK economy, including steps to support bank lending to businesses. A package of measures is due to be announced over the next few weeks.
Mr Darling is also this week expected to call for tough new global financial regulations ahead of a G20 summit to be held in London in April.
Articles from our sister site WSJ.com:
You may be asked to subscribe to read certain articles
Win a luxury weekend to Newcastle and its neighbour Gateshead, find out more here
Risk, resilience and embracing new technology
Industry sectors news at a glance. Interactive heatmap, video and podcast
Discover the power of collective thinking. Submit a solution and be in with a chance to win a Media Hub Home Entertainment System
The inside track on current trends in the charity, not for profit and social enterprise sectors
Everything the Business Traveller needs to know to make a better trip
Make the most of the summer and enter our fabulous photographic competition, you could win a £5000 holiday
Corsica is an island of beauty and contrast, an ideal holiday destination
Enjoy further reading from Travel to Fashion, Business to Sport, discover more
Shortcuts to help you find sections and articles
The clever way to lease a new car is with Car leasing made simple™
2009
per month on 36-month
Personal Contract Hire (PCH)
2008
42850
Car Insurance
£23,093 - £56,211
The Office for National Statistics
Newport, South Wales
£60,000
The Environment Agency
Bristol
Up to £90K
Boots
Midlands
OTE £85k
Credit Protection Association
Nationwide Opportunities
Completely London
Luxury Condo's in Manhattan with NYC views
The best new homes in Wimbledon?
Nationwide
Fabulous Cruise And Cruise & Stay Offers Including Virgin Atlantic Flights Prices Start From Only £699pp!
Last Minute Cruise And Cruise & Stay Offers. Med From £499pp, Caribbean From £699pp!
5 star quality at a 3 star price.
8 fabulous Canadian cities ...you won’t find cheaper
Contact our advertising team for advertising and sponsorship in Times Online, The Times and The Sunday Times, or place your advertisement.
Times Online Services: Dating | Jobs | Property Search | Used Cars | Holidays | Births, Marriages, Deaths | Subscriptions | E-paper
News International associated websites: Globrix Property Search | Property Finder | Milkround
Copyright 2009 Times Newspapers Ltd.
This service is provided on Times Newspapers' standard Terms and Conditions. Please read our Privacy Policy.To inquire about a licence to reproduce material from Times Online, The Times or The Sunday Times, click here.This website is published by a member of the News International Group. News International Limited, 1 Virginia St, London E98 1XY, is the holding company for the News International group and is registered in England No 81701. VAT number GB 243 8054 69.
Come on. He knew already. Give good news before Christmas and break bad news in January. Then no-one can so that you ruined this Xmas. Next Xmas of course is ruined.
Michael, West Midlands,
So where exactly does this leave all the sums adding up in the Pre-Budget Report then? Wasn't that all predicated on the strength of this miraculous 'recovery' in end 2009?
Jo, Cumbria,
Recovery?! Not the word to use after the shipwreck this is turning into. Salvage more like. Nice idea of Labour to make a fairer world, but how come the rich just keep getting richer? Is it 'cos they buy the politicians and make sure sensible policies are never even discussed?
Chris, London,
Hapless incompetent darling, placed there as the scapegoat for a decade of brown's building of debt. Now they're flailing around trying to get the UK to spend its way out of the crisis. The UK is not the US. When will the Brits see through these fools and Mandelson's hollow spinning
A J Britt, Brussels, Belgium
If anyone actually believes the comments Darling is making he is either an optimist or a fool. The facts are simple - Labour has made a hash of the financials and our children have already received their legacy. A layman understands the financial carnage and so does Darling
julian, newbury, england
Things won't improve till this bunch of crooks and ne'er do wells with their ridiculous policies are kicked out of office.
Paul, Milton Keynes, UK
The problem for the UK is that it does not 'make' anything any longer, not even enough food for itself , Russians have the gas and oil and Europe is not going to help. Get back to self sufficiency and be independent. Oh and while you are about it get rid of Brown et al.They never did have a clue.
Grey, Auckland, New Zealand
The most depressing news is that Darling claims actually to think. What of?
Dave, Slough,
We have been in this "hole" since the Northern Rock crises of Sept 2007. Early last year, businesses were screaming for interest rate cuts while the government insisted that inflation was more relevant. Darling conveniently ignored the obvious in the Nov 08 budget, was he honest?
Femi, Ilford, UK
Wake up Mr. Darling. I wrote a news letter for my company in Nov 08, stating that the UK economy and indeed the world economy will not see any recovery until 2010-2011. I am just a mere mortal, how can anyone with the most inteligent advisors in the world make such a bad call?
Tim Grosvenor, Bury St Edmunds, UK
I own a small business and if it fails where will the bail out come from? Same old story - bankers create the mess get baled out we all have to suffer the consequences. Never trust them again and ask for the bonuses back as we didn't share in their boom times!
Richard, Manchester, UK
Leave the UK while you can, I did. Without the financial services industry to back it up it is a dead duck. It will somehow have to bring back manufacturing jobs from eastern europe to create new jobs. Many of the tippety-tappety service jobs will go...I see a burgeoning bankruptcy for the UK.
Richard, Strasbourg, Francwe
Dear old Mr Darling; he looks like a shortsighted wooly sheep and behaves like one. Talk about the blind leading the blind. this mess will take ten years to sort out just as did the Wilson/Foot/Callaghan era of annual 25% inflation in the '70's when it took Margaret Thatcher a decade to put right.
John Bentley, Loule, Portugal
Evidence? Everyone was screaming at them last year and they did nothing. Now companys have had to give up.
What they mean is they hoped we would recover on our own so they could claim victory. Now it turns out we actually needed leadership they failed every business in Britain.
rich, worcester, worcestershire
There will be a bottom at the end of this long drop, but what shape will the UK be in when it hits it given the country is bouncing off the walls on its way down?
James Dene, Dorking, UK
Every treasury forecast since Brown took over in 1997 has been hopelessly optimistic. Why should anyone be surprised about this last one. Darling just hasn't got a clue.
Ian, London, UK
At least Darling is being honest. Who knows how long this recession will be and how deep? Certainly not the financial analysts. Certainly not the ECB, who seem to be completely reactive to events, not proactive. Look for no recovery until at the best late 2010.
Peter, Guildford,