The economy will shrink by 2.8 per cent this year, with Britain faring significantly worse than the United States, Western Europe or Japan due to its reliance on the financial sector, the International Monetary Fund said.
Its forecast was almost double its previous prediction for the severity of the UK recession and prompted leading experts to warn British families were facing an "extremely painful" period, with people getting poorer in the next 12 months.
The IMF's gloomy assessment of Britain's prospects also came as a severe blow to Gordon Brown, who faced fierce criticism from Conservative leader David Cameron yesterday for his "complacent" handling of the economic downturn.
The Tories warned that the UK was now heading for the "worst recession in the world" and its worst year for 60 years.
"Let us hope these forecasts are wrong. But if they are not, Britain is set to endure the worst downturn of any major country and the worst year for the economy since 1948," George Osborne, the shadow chancellor, said.
"Without a change of direction we will be living with Labour's debt crisis for a generation."
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