“New figures on households show that savings remained high, with an increase in income in the last quarter of the year.”

Chancellor of the Exchequer Jeremy Hunt said: “Last year was tough as interest rates had to rise to bring down inflation, but we can see our plan is working.”

However, Rachel Reeves, Labour’s shadow chancellor said the latest ONS figures confirmed the Conservatives have not made any progress with the economy.

She said: “Rishi Sunak has broken his promise to grow the economy and left Britain in recession with working people paying the price.

“The Conservatives cannot claim that their plan is working or that they have turned the corner on more than fourteen years of economic failure. It is time for a change.”

Sarah Olney, Liberal Democrat Treasury spokeswoman said: “These damning figures confirm the damage done to the UK economy by Rishi’s recession.

“This Conservative government has no plan for growth or to help families paying the price for years of economic chaos through soaring mortgages and rents.”

However, the Chancellor has stated cuts to National Insurance are aimed to help Britons by putting more cash back in their pockets.

He said: “Our cuts to National Insurance will boost growth by rewarding work and putting over £900 a year back into the average earner’s pocket.”

This is not the first-time recession figures have been revised and labelled less severe than first believed.

In 2011, it was reported there was a “double-dip” when Chancellor George Osborne was appointed, however this was revised and it was reported that it did not happen.

LATEST DEVELOPMENTS:

However, the ONS said all three sectors – services, production and construction – had dropped in the final months 2023.

The recession was only less severe due to a rise in government spending.

Services declined by a weaker 0.1 percent compared with a 0.2 percent fall in the first estimate, but without making a difference to overall trade.