Economic Growth Fails To Meet Expectations

The British economy only grew by 0.1% between April and June this year - less than the 0.2% estimated previously.

It has also been revealed that output from the service sector grew by 0.2%, compared with the previous estimate of 0.5%.

The Office for National Statistics (ONS) also said that on a more positive development, industrial output fell by less than previously thought.

Just a few weeks ago, in mid September, the European Commission had already slashed its forecast of UK growth this year from 1.7% to 1.1%, as news of falling retail sales underlined the economy's troubles and a Monetary Policy Committee member warned of increased danger of recession.

The revision means the European Commission is now forecasting UK growth in 2011 will be much weaker than that projected by the Office for Budget Responsibility, which was set up by Chancellor George Osborne.

Mr Osborne's projections for the public finances in his most recent Budget in March were based on the forecast then that the UK economy would grow by 1.7% this year.

Meanwhile, the leading supermarket company, Tesco has reported a rise in half-year profits - despite a fall in underlying sales in the UK.

Pre-tax profit for the 26 weeks to 27 August was £1.9bn, up 12.1% on a year earlier. Group sales rose 8.8% to £35.5bn, but like-for-like UK sales excluding VAT and petrol fell 0.5%.

In the face of this mixed news, the PM, David Cameron is to call on UK citizens to do their bit for Britain - and ask them to pay off their credit and store card debts.

In his keynote speech to the Conservative conference later today, the PM will argue that the debt crisis was caused by individuals - as well as businesses, banks and government - borrowing too much.

(BMcC/CD)