THE Tories’ “casino capitalism” has broken the economy, unions charged today, after it was confirmed Britain has plunged into a recession.
The Office for National Statistics (ONS) said gross domestic product fell by 0.3 per cent in the fourth quarter last year, following a decline of 0.1 per cent in the previous three months.
This means the economy has now entered a technical recession, as it has contracted rather than grown for two consecutive three-month periods.
Tory Chancellor Jeremy Hunt blamed inflation and high interest rates for the fall, while claiming the economy was “turning a corner.”
But Labour hit back that the Tories’ pledge to grow the economy is now in “tatters.”
The party said the recession exposes dozens of untrue claims, such as when Prime Minister Rishi Sunak boasted to the BBC last month that Britain had avoided a recession under his rule.
“The Prime Minister can no longer credibly claim that his plan is working, or that he has turned the corner on more than 14 years of economic decline under the Conservatives that has left Britain worse off,” shadow chancellor Rachel Reeves said.
“This is Rishi Sunak’s recession and the news will be deeply worrying for families and businesses across Britain.”
According to ONS figures the dip was broad-based, with all main industrial sectors affected.
It is the first time Britain has entered a recession since the first half of 2020 when the initial Covid-19 lockdown froze much economic activity.
Overall the economy has grown by just 0.1 per cent, down from 4.6 per cent in 2022 — the weakest growth since the aftermath of the financial crisis in 2009.
Economic growth per head of the population has also shrunk for seven consecutive quarters in the longest period since records began in 1955.
Unite general secretary Sharon Graham said the figures demonstrate how the government has “broken the economy for normal people.”
“The public remain gripped in a cost of living crisis, inflation hasn’t been brought under control and workers are suffering under the yoke of high interest rates.
“The government’s response has been to stoke up casino capitalism, allowing rampant profiteering and unlimited bonuses for City bankers, while at the same time forcing through anti-union legislation to prevent workers securing fair pay increases.”
She accused the Chancellor of “looking to use a recession he caused as an excuse to load more austerity onto public services that are already on their knees.”
When Mr Hunt was asked on Sky News if he might reduce public-sector spending to lower taxes in the upcoming Spring Budget, he refused to go into specifics.
But he hinted countries with “lighter taxes” tend to “grow faster” and said the Budget would concentrate on “prioritising economic growth.”
“The Tories have driven our economy into a ditch and have no idea how to get out” said TUC general secretary Paul Nowak. “The Conservatives’ economic failures are hitting jobs and living standards.
“With household budgets at breaking point, spending is down and the economy is shrinking. At the same time, our crumbling public services are starved of much-needed funding.”
The latest ONS figures serve as a reality check for the Prime Minister.
His pledge to boost the economy, which he outlined as one of his top priorities last year, now stands alongside his other unfulfilled promises to reduce NHS waiting lists and lower national debt.
