Tories accused of ‘losing control of the economy’ as figures show it shrinking faster and worst in G7

The Conservatives have been accused of “losing control of the economy” as figures show GDP shrinking faster than previously thought.

The Office for National Statistics on Thursday published revised figures for the three months to September showing economic activity contracting by 0.3 per cent, compared with a previous estimate of 0.2 per cent.

The slowdown also extended to the first half of the 2022 with previous growth estimates revised down in the new numbers.

Labour’s shadow chancellor Rachel Reeves noted that the statistics left 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,” she said.

Liberal Democrat Treasury spokesperson Sarah Olney added: “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 revisions mean the UK economy is even further from recovering to its pre-pandemic level than previously thought – now 0.8 per cent behind rather than 0.4 per cent.

This performance puts the UK well behind its neighbours. Bank of England governor Andrew Bailey last month contrasted the UK’s performance with that of the eurozone area, whose economy now 2.1 per cent bigger than in 2019, and the US economy which is now 4.2 per cent beyond its pre-pandemic level.

Darren Morgan, director of economic statistics at the Office for National Statistics, said: “Our revised figures show the economy performed slightly less well over the last year than we previously estimated, with manufacturing and electricity generation notably weaker.

“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.”

A recession is defined as two consecutive quarters of negative economic growth, and the UK is expected to enter one in the next quarter.