The Shadow Chancellor Ed Balls has accused the Prime Minister and Chancellor of complacency and called for "direct help to struggling families and businesses".
Reacting to today's announcement of GDP figures, Mr Balls said: "These deeply disappointing figures expose just how dangerously complacent the Prime Minister was when he said last autumn that the ‘good news will keep coming’."
“This government’s failing plan has now seen our economy stagnate for over two years and borrowing is now rising as a result."
“It is grossly irresponsible and out of touch of George Osborne to once again try to shrug off bad news and refuse to heed the advice now coming to him from right, left and centre," he added.
The chief economist at the Institute of Directors, Graeme Leach, said that the end of the Olympics obscured the fact that the economy is flat - not shrinking:
– Graeme Leach, Institute of Directors Chief Economist
You can’t see the road ahead through the rear view mirror. The GDP fall was largely attributable to the unwinding of the Olympic effect and so the underlying story is that output is flat.
The critical factor is not what the GDP figures did in Q4 [fourth quarter of 2012] but what the broad money supply figures will do in Q1 [first quarter of 2013].
If the recent slight pick-up in money supply growth can be sustained, the UK economic outlook in 2013 will be better than people expect. So hold back on the doom and gloom.
The head of the TUC union, Frances O'Grady, has accused the Chancellor George Osborne of pushing the economy to the "brink of an unprecedented triple-dip recession".
– Frances o'grady, general secretary, tuc
We are now mid-way through the coalition’s term of office and its economic strategy has been a complete disaster.
The economy has grown by just one per cent, real wages have fallen, and the manufacturing and construction sectors have shrunk. We remain as dependent on the City as we did before the financial crash.
The Chancellor now has all the evidence he needs to change course and focus instead on investment and growth. If he refuses to listen he could do even more permanent damage to the economy.
The Office for National Statistics said the UK has recovered only half of the fall in GDP seen since the start of the 2008 recession, with output still 3.3% lower than its pre-recession level.
Chancellor George Osborne said today's GDP figures are a reminder of the "difficult economic situation" faced by the country. Speaking from Davos, where world leaders and business leaders are meeting, he said:
"We have a reminder today that Britain faces a very difficult situation, a reminder that last year was particularly difficult.[..] Now we can either run away from these problems, or we can confront them, and I am determined to confront them."
Labour MPs and party members have been reacting to today's GDP figures on Twitter
Where's the part-time Chancellor? Who will he blame this time? #Georgesmarvellouseconomicmedicine
GDP figures are really disappointing and worrying. The politics of this are irrelevant - ordinary people's quality of life is at stake.
The economy grew more in the last year of the Labour government than in all three years of the Coalition put together. #GDP
The head of the Confederation of British Industry (CBI) gave this reaction to today's release of GDP figures for the fourth quarter of 2012:
– John Cridland, CBI Director-General
After a difficult year, the UK economy has ended on a disappointing note.
We think growth will continue to be fairly flat through the winter but momentum will gradually build later in the year, as the global economy picks up a little and confidence lifts.