Chancellor bullish on UK recovery

The chancellor, Alistair Darling, has rebutted claims by the Organisation for Economic Co-operation and Development (OECD) that the UK is set to lag behind as the other major economies begin to emerge from the worldwide recession.

According to the organisation's latest Interim Economic Assessment, the global economy is set to emerge from the recession quicker than previously predicted.

However, in addition to warning that economic activity will remain weak into 2010, the organisation, which works with the governments of the world's most developed nations, has revised downwards its prediction about the UK economy.

The OECD now believes the UK economy will shrink by 4.7% this year. This is more pessimistic than the prediction of 4.3% negative growth it made in June.

However, the report notes that the differences between the two projections could be attributed to revisions in historical data, along with the Q3 and Q4 figures.

The report, which points to improved outlooks for the Euro zone and Japan and an unchanged one for the US, highlighted the "gloomier situation in the UK".

Chancellor Alistair Darling told BBC Four's Today Programme that he questioned the pessimism of the organisation's assessment of the UK.

"The OECD has made predictions in the past [and] some have turned out not to be so spot-on," he said.

"My prediction in the Budget is that this country will come out of recession around the turn of the year.

"I hold to that view."

IMAGE Simon Dawson/PA Wire