PlayBrown warns of coming recession
Published: Wednesday, 22 October 2008, 6:58AM
Prime Minister Gordon Brown has admitted Britain is likely to slip into recession as a result of the global economic downturn.
Mr Brown has previously avoided using the "R-word" about the economic situation.
But after a gloomy speech by the Governor of the Bank of England Mervyn King he finally said it during Prime Minister's Questions.
"The Governor of the Bank of England said last night that not since the first world war has the international banking system been so close to collapse and I agree with him," said Mr Brown.
"Having taken action on the banking system, we must now take action on the global financial recession which is likely to cause recession in America, France, Italy, Germany, Japan and - because no country can insulate itself from it - Britain too.
"That is why we are giving our undivided attention to helping families and businesses."
Mr Brown announced new measures to help hard-pressed homeowners stave off repossession of their homes.
Tory leader David Cameron accused Mr Brown of having "racked-up" debt during the boom years and getting the stewardship of the economy "wrong".
He repeatedly challenged the Prime Minister to admit that he had not "abolished boom and bust".
But Mr Brown sidestepped the question and insisted it was "right" to stimulate economic activity by borrowing in a downturn.
"The reason we can afford to borrow is that we have low national debt," he told MPs.
Mr King earlier became the first major public figure to warn of recession.
He said the economy faced a "long, slow haul" to repair the damage from the banking crisis.
"It now seems likely that the UK economy is entering a recession," he said.
© Independent Television News Limited 2008. All rights reserved.
