UK's downturn deeper than expected - Darling

Britain's economic downturn is likely to be deeper and last longer than expected and could be the worst for 60 years, finance…

Britain's economic downturn is likely to be deeper and last longer than expected and could be the worst for 60 years, finance minister Alistair Darling has said.

In a candid interview with the Guardiannewspaper, the Chancellor of the Exchequer said the Labour government had failed to get its message across and would battle to persuade a sceptical electorate it deserved another term in power.

His comments suggest concern in the highest ranks of the government that the downturn will make it difficult for Prime Minister Gordon Brown to recover popularity and fend off a resurgent opposition Conservative Party.

The government and Mr Brown himself have seen their opinion poll ratings plummet in the last six months and the government is now languishing 21 points behind the Conservatives. A national election must be held by mid-2010 at the latest.

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The Guardianquoted Mr Darling as saying economic times for the country were "arguably the worst they've been in 60 years".

"I think it's going to be more profound and long-lasting than people thought, he said."

"We've got our work cut out. This coming 12 months will be the most difficult 12 months the Labour Party has had in a generation, quite frankly. "We've got to rediscover the zeal which won three elections, and that is a huge problem for us at the moment. People are pissed off with us," Mr Darling said."

The BBC called the interview an "astonishing intervention" and reaction from opposition politicians was swift. Conservative economy spokesman George Osborne chided Mr Darling for "letting the cat out of the bag" about the real state of the economy while Liberal Democrat spokesman Vince Cable called Darling's comments a "scarcely concealed attack on Gordon Brown himself."

The bleakness of Mr Darling's assessment of the economy marks a departure from his previous mantra that Britain's flexible labour market left the country well placed to withstand the global credit crisis. Some political commentators suggested his comments may be an attempt to soften public opinion ahead of a package of measures next week designed to buffer the economy and help Mr Brown regain the political initiative.

The measures are likely to include help for first-time homebuyers and Britons struggling with soaring fuel bills. The speed and scale of Britain's economic downturn has become increasingly apparent. Official figures last week showed the economy failed to grow in the second quarter for the first time since the early 1990s.

The pound has suffered its worst month against the dollar since sterling's ejection from Europe's Exchange Rate Mechanism in 1992 and a growing number of analysts believe the economy may have already tipped into recession. House prices have crumbled by more than 10 per cent over the past year and the number of mortgages approved for home purchase has hit a record low, suggesting no hope of recovery anytime soon.