UK economy 'unlikely to recover to pre-recession levels before 2014'

The UK economy is unlikely to fully recover from the current recession until 2014, a new report from the National Institute of Economic and Social Research (NIESR) has warned.

According to the latest predictions from the think tank, total UK GDP is set to continue to fall, taking the total 2009 decline to 4.3 per cent, before picking up slightly by one per cent and 1.8 per cent in 2010 and 2011 respectively.

As a result, it will take another five years for income per head across Britain to return to the pre-recession level of early 2008, the report concluded.

Furthermore, the NIESR expressed its belief that the cost of servicing the UK national debt will almost double over the next four years, while general economic growth is also likely to be hampered as house prices continue to fall for a further three years.

In order to address the current economic situation facing the UK, the report advised: ’The introduction of a more credible plan to return the public finances to a path of fiscal sustainability remains a necessity.’

These predictions come soon after the Office for National Statistics reported that total outstanding government debt in the UK now stands at 56 per cent of total UK GDP.
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