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The Chancellor refutes that Britain faces a recession, after a financial think-tank reported the UK economy shrank in the first three months of the year.Follow live coverage of the debt crisis
A report by the organisation for Economic Co-operation and Development (OECD) claiming that the UK has slipped back into recession is at odds with the government’s own forecast, the Chancellor said.
He conceded there were problems with the UK economy but the government was making great efforts to address them.
“You can’t turn round the British economy overnight. It became very dependent on the City of London, very dependent on public spending which had to be borrowed and we have got to change that,” he said.
According to the OECD the UK economy shrank in the first three months of the year.
Over the January to March period, economic output fell compared to the previous quarter, at an annual rate of -0.4pc, the Paris-based think-tank claimed. That would imply quarter-on-quarter growth of -0.1pc.
After three months of negative growth at the end of last year, that figure would signal that the UK has double-dipped back into a recession.
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