Chancellor Philip Hammond describes UK economy as 'remarkably resilient' despite slowdown

"Remarkably resilient"- that's the chancellor's assessment of the performance of the economy in 2018. Philip Hammond is clearly a glass half-full man.

It's true that growth of 1.4% in 2018 is a country mile away from disaster, but it is the weakest annual growth since 2009 and there's no disguising the pace at which the British economy is slowing.

Between October and December the economy grew by a feeble 0.2%. In the final month of the year it went into reverse, contracting by 0.4%.

Business investment has fallen consistently for a year - the last time that happened was during the financial crisis.

Manufacturing is in recession and in December every sector of the economy contracted.

The chancellor blames the global slowdown in growth but concedes Brexit uncertainty is a factor.

"Once businesses have clarity, they will invest again", Hammond told ITV News.

"My judgement is that we are likely to get the (prime minister's) deal through Parliament but I can't be 100% certain, and that is why we are doing the contingency planning we are doing."

Brexit uncertainty is hampering the UK's economy. Credit: PA

Brexit is less than 50 days away and businesses are complaining about the lack of guidance from government about what happens in the event of no-deal.

A snap poll by the EFF - the manufacturers association - of its members shows that more than half now doubt the government's ability to avoid no-deal.

Some 80% said they are not yet ready for a disorderly departure from the EU on March 29th; 60% said prices would rise in the event of no-deal; 30% said they would have to lay off staff.

Confidence in the government's competence appears to be slowly bleeding away.

The chancellor denies suggestions that businesses are being kept in the dark.

"Business is challenged, I accept that, but we can't convey information that we don't have. We don't know how some of our partners on the other side of the channel will behave in the event of no-deal Brexit," Hammond said.

UK economic growth has slowed 'to its lowest rate since 2012'. Credit: PA

Many businesses don't see it that way. In private, they are furious about the lack of clarity on everything from tariffs to customs checks to roaming charges for mobile phones in the event of no-deal.

In public, the language they are using to describe the government's contingency planning is becoming sharper and far more direct.

"No deal would be a very bad outcome for economy," Hammond said.

"“The next two weeks are critical."

He argues that Jeremy Corbyn's letter is not "a serious basis to movie forward with EU" but seems convinced that common ground can be found.

Hammond remains stoically optimistic, but in truth he can't be seen to be anything else. The government refuses to rule out No Deal, so it is possible that he will end up be remembered as the chancellor who lead Britain “over the cliff edge”. Would history forgive him and his party? “That (No Deal) is not going to happen” he replies.