Rishi Sunak accused of 'losing control' as economy contracts by more than first thought in third quarter

Rishi Sunak has been blamed for the state of the economy.Rishi Sunak has been blamed for the state of the economy.
Rishi Sunak has been blamed for the state of the economy.
Rishi Sunak has been accused of “losing control” after the economy contracted by more than first thought in the third quarter this year.

The Office for National Statistics (ONS) revealed growth was weaker than estimated throughout much of the past year in a grim set of official figures.

Ministers had already admitted Britain was heading into a recession, but the new data reveals things are even worse than first thought.

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The ONS said gross domestic product (GDP) fell by a revised 0.3 per cent in the third quarter of 2022 against the 0.2 per cent decline initially estimated.

The economy also grew less than first estimated throughout the first half of the year, with revisions showing the UK eked out growth of 0.6 per cent in the first quarter and 0.1 per cent in the second quarter.

Experts predict the economy to contract again in the final quarter of 2022, which would see the UK enter a recession – as defined by two quarters or more in a row of falling output – with forecasts that it will remain in contraction throughout next year as the cost-of-living crisis hits hard.

Now opposition parties have pinned the blame on the Prime Minister, with shadow chancellor Rachel Reeves accusing the UK Government of losing control.

The Labour MP tweeted: “GDP data has been revised down, leaving the UK with the worst growth in the G7 in the last quarter. The Tories have lost control of the economy and are leaving millions of working people paying the price.

“Only Labour has a proper plan to get our economy growing.”

The Liberal Democrats insisted the blame lay with Mr Sunak. The party’s treasury spokeswoman Sarah Olney said: “For every inch the UK moves closer to recession, the blame must lie squarely at the feet of Rishi Sunak.

“Ordinary families and pensioners should not have to pay the price for the Conservative Government’s mistakes. There is no more time for wake-up calls – the Government need to get a grip on our economy.”

The latest figures also showed the impact of rocketing inflation on families, with household disposable income down by 0.5 per cent in the quarter.

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Household spending dropped by 1.1 per cent after inflation is taken into account – the first fall since January to March last year.

Darren Morgan, director of economic statistics at the ONS, said: “Household incomes continued to fall in real terms, albeit at a slower rate than in the previous two quarters, while – taking account of inflation – household spending fell for the first time since the final Covid-19 lockdown in the spring of 2021.”

Chancellor Jeremy Hunt sought to blame Russian president Vladimir Putin’s invasion of Ukraine for the economic difficulties.

He said: “High inflation driven by Putin’s invasion of Ukraine is slowing economic growth across the world. No country is immune, least of all Britain. Getting prices down so people’s wages go further is my top priority, which is why we are holding down energy bills this winter and providing extra cost-of-living payments for the most vulnerable.

“To get the British economy back on track, we have a plan that will help to more than halve inflation next year, while laying the foundations for long-term growth through record investment in infrastructure and new industries.”



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