UK Politics

PM vows to stick to economic plan despite recession

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Media captionEd Miliband: "Arrogant, posh boys just don't get it"

David Cameron has said it would be "absolute folly" to abandon his plan to tackle the deficit, despite the UK entering a double-dip recession.

He hit back after Labour leader Ed Miliband blamed government cuts for the "catastrophic news" that growth fell for the second consecutive quarter.

The prime minister said the economy's problems were "long in the making".

But Mr Miliband said the recession had been "made by him and the chancellor in Downing Street".

The two leaders clashed during prime minister's questions, just hours after the Office for National Statistics announced that the UK had returned to recession, after shrinking by 0.2% in the first three months of 2012.

It is the UK's first double-dip recession since the 1970s.

'Difficult work'

Mr Cameron said the figures were "very, very disappointing", adding: "I don't seek to excuse them, I don't seek to try and explain them away.

"Let me be absolutely clear. There is no complacency at all in this government in dealing with what is a very tough situation that, frankly, has just got tougher."

He continued: "This is painstaking, difficult work but we will stick with our plans."

Mr Miliband said it was the government's "catastrophic economic policy" that had led to a "slower recovery from recession even than the 1930s".

"Over the last 18 months since his catastrophic spending review, our economy has shrunk," he said.

"The reality is that it is families and businesses who are paying the price for his arrogance and complacency."

But the prime minister said there was "not a single business organisation, serious commentator or international body that thinks these problems emerged in the last 24 months".

"The debt crisis has been long in the making, the failure to regulate our banks has been long in the making, the government over-spending has been long in the making."

And he added: "The solution to a debt crisis cannot be more debt.

"We must not put at risk the low interest rates that are absolutely essential to our recovery. That would be absolute folly."

Wednesday's GDP figures came as a surprise after most commentators had predicted a slight increase in growth.

A sharp fall in construction output and a stagnant services sector were blamed for the decline.

The figure is an early estimate and is subject to at least two further revisions in the coming months.