This is further evidence of how unsustainable the recovery – which is heavily reliant on consumer spending and levels of household debt relative to income – actually is.
The general election campaign has, however, been dominated by the major UK political parties looking at how they can impose further austerity, cutting the deficit and the debt through public spending cuts, rather than doing so by investing in the economy to stimulate economic growth.
When it comes to total private and public sector investment the UK’s record on this is appalling, coming in 32nd out of the 35 most advanced economies in the world, a significant concern when it comes to the future prospects of the economy.
There needs to be a radical change in mindset and a focus on increasing both public and private sector investment, through modest public spending increases and additional borrowing.
This will see the deficit and the debt being cut, but on the back of sustainable economic growth.
Without such an approach the fragile foundations on which the economic recovery is currently based will quickly crumble.