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13/01/2009
Britain Facing 'Very Serious Recession'
Britain is facing a "very serious recession" according to new figures published today which showed the worst sales figures in December on record.
The British Chambers of Commerce (BCC) published its Fourth Quarter Economic Survey which highlighted a "frightening deterioration" in the UK economic situation with the worst survey results since it began in 1989.
Meanwhile, in a separate - yet equally bleak - survey the British Retail Consortium (BRC) recorded UK retail sales slump 3.3% on a like-for-like basis and 1.4% on a total basis from December 2007 - despite the government cut in value added tax (VAT) to 15%, which took place in December.
Both measures showed "the worst December" since the survey began 14 years ago, and "barring Easter distortions, the worst performance of any month in that time".
Food and footwear were the only sectors to show sales up on a year ago - with the latter reflecting further discounting.
The rise in online shopping boosted non-food, non-store sales by 30% on a year ago. However, clothing, furniture and 'big ticket' homewares fell further below year-earlier levels in December.
Stephen Robertson, Director General of the BRC, described the results as "truly dreadful numbers".
He added: "Some retailers were more successful than others and the second half of December was better than the first. But overall the food sector was almost the only one to show growth."
According to the BCC report, there were "no positive features in the Q4 results", as domestic demand is plunging, exports are falling and confidence is "plummeting".
David Frost, Director General of the BCC said: "These are truly awful results with the scale and speed of the economic decline happening at an unprecedented rate.
"We have to focus on holding the productive sectors of the economy together. If we are to climb out of this morass we will need a strong business base."
He continued: "A clearly defined National Recovery Plan will need to be rolled out as soon as possible, involving all politicians."
BCC Chief Economist, David Kern added: "The measures taken in recent months have failed so far to alleviate the downturn. The Q4 results signal big increases in unemployment next year.
"Interest rates will have to be reduced to almost zero in early 2009. But interest rate cuts, though important, are no longer adequate on their own.
"New and more far-reaching measures like a further fiscal stimulus and quantitative monetary easing should be introduced."
He added that it was not worse than the recession of the 1980s, so it was still possible to "avoid a prolonged depression".
(JM/BMcC)
The British Chambers of Commerce (BCC) published its Fourth Quarter Economic Survey which highlighted a "frightening deterioration" in the UK economic situation with the worst survey results since it began in 1989.
Meanwhile, in a separate - yet equally bleak - survey the British Retail Consortium (BRC) recorded UK retail sales slump 3.3% on a like-for-like basis and 1.4% on a total basis from December 2007 - despite the government cut in value added tax (VAT) to 15%, which took place in December.
Both measures showed "the worst December" since the survey began 14 years ago, and "barring Easter distortions, the worst performance of any month in that time".
Food and footwear were the only sectors to show sales up on a year ago - with the latter reflecting further discounting.
The rise in online shopping boosted non-food, non-store sales by 30% on a year ago. However, clothing, furniture and 'big ticket' homewares fell further below year-earlier levels in December.
Stephen Robertson, Director General of the BRC, described the results as "truly dreadful numbers".
He added: "Some retailers were more successful than others and the second half of December was better than the first. But overall the food sector was almost the only one to show growth."
According to the BCC report, there were "no positive features in the Q4 results", as domestic demand is plunging, exports are falling and confidence is "plummeting".
David Frost, Director General of the BCC said: "These are truly awful results with the scale and speed of the economic decline happening at an unprecedented rate.
"We have to focus on holding the productive sectors of the economy together. If we are to climb out of this morass we will need a strong business base."
He continued: "A clearly defined National Recovery Plan will need to be rolled out as soon as possible, involving all politicians."
BCC Chief Economist, David Kern added: "The measures taken in recent months have failed so far to alleviate the downturn. The Q4 results signal big increases in unemployment next year.
"Interest rates will have to be reduced to almost zero in early 2009. But interest rate cuts, though important, are no longer adequate on their own.
"New and more far-reaching measures like a further fiscal stimulus and quantitative monetary easing should be introduced."
He added that it was not worse than the recession of the 1980s, so it was still possible to "avoid a prolonged depression".
(JM/BMcC)
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Northern Ireland WeatherToday:A mostly cloudy day with outbreaks of rain, most persistent and occasionally heavy across southern and western counties this afternoon. Risk of low cloud and fog patches affecting the Down coast. Light winds. Maximum temperature 15 °C.Tonight:Continuing cloudy through the evening with further outbreaks of rain, the rain turning lighter and patchier from the south overnight. Winds remain light. Minimum temperature 8 °C.
