London, Jan 24 (ANI): Britain is heading for economic depression for the first time since the 1930s, economists have warned. Families must brace themselves for a slump of far greater severity and longevity than the recessions of the 1980s and 1990s, The Telegraph quoted economists, as saying.
They said the current crisis will be of a scale to rival the biggest peace-time crisis in modern history - the Great Depression.
Economists and politicians delivered the warning after the Office for National Statistics revealed that the economy shrank by 1.5 per cent in the final three months of 2008 alone.
The contraction follows a 0.6 per cent fall in gross domestic product (GDP) - the most comprehensive measure of Britain's wealth generation - during the previous three months.
This means Britain fulfils the criteria for a technical recession - two successive quarters of negative output.
The news sent the pound sliding to its lowest level since 1985. Sterling dropped more than three quarters of a cent to 1.3688 dollars as investors speculated that the Bank of England might be forced to cut interest rates towards zero in response to the recession. ohn McFall, the Labour chairman of the Treasury select committee, sounded a more optimistic note.
He said: "We know that 2009 is going to be really tough for many people. There is a determination in Britain and across Europe to keep people in work, to avoid unemployment, so people's contribution will not be lost." (ANI)