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One-third of adults has cut spending

Nigel Morris
Monday 31 October 2011 01:00 GMT
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Millions of Britons are reducing their spending amid fears that economic recovery is still a distant prospect and confidence has fallen to a two-year low among company chiefs, surveys last night disclosed.

Fresh evidence of a national mood of pessimism emerged ahead of figures tomorrow expected to show the economy continues to stall.

David Cameron, Nick Clegg and Ed Miliband will today seek to turn the spotlight on to the economy ahead of next weekend's summit of G20 summit in Cannes.

A survey for the think-tank Resolution Foundation found that a third of adults had cut household spending and 19 per cent expected to make further savings next year.

The survey by Ipsos MORI also revealed rising anxiety about job security while Lloyds Bank said its research found 49 per cent of firms were gloomy about their prospects, a sharp rise from the 33 per cent who said they were gloomy last month.

Tomorrow's figures for economic growth in the third quarter are expected to show only a marginal increase in economic activity. The economy grew by 0.2 per cent in the second quarter of 2011 after flatlining for the previous six months.

Writing in the Financial Times today, Mr Cameron said: "There will be no short cuts to success. But this coalition has the determination to do the right thing for our country, so that we don't just weather the international storm – but come out stronger on the other side." He also announced that 1,000 jobs are to be created by the construction of two new power plants in the North of England.

Mr Miliband will warn today that cuts to investment allowances will lead to some firms receiving bills that are £30,000 higher, stifling their ability to expand.

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