THE UK’s economic growth rate more than halved in the first quarter, as

surging inflation triggered by sterling’s post-Brexit vote weakness hit

consumers, prompting a claim the Government was “asleep at the wheel”.

Figures published yesterday by the Office for National Statistics showed UK growth slowed to just 0.3 per cent quarter-on-quarter in the opening three months of this year.

In the fourth quarter of 2016,

UK gross domestic product grew by

0.7 per cent quarter-on-quarter. Growth in the first quarter was the weakest since the opening three months of last year.

The sharp slowdown, which the data signalled was down to increasingly hard-pressed consumers reining in spending, was even worse than economists had projected. Economists had, overall, predicted growth of 0.4 per cent in the first quarter.

Tim Roache, general secretary of the GMB trade union, said: “The

Tories had no plan for leaving the

EU – and now ordinary working people are feeling the pinch from

the collapse in the pound, increased inflation and the rise in [the] cost

of living.

“The Tories are continuing to squeeze wages in the public sector, plan even more cuts, and stand by while jobs in the private sector are being made even more insecure.”

He added: “The Government is asleep at the wheel and ministers need to wake up to the fact that improving pay and job security is good for the economy as well as vital for working people. This slow growth is extremely worrying with tough Brexit negotiations ahead.”

UK services sector growth slowed to just 0.3 per cent in the first quarter, from 0.8 per cent in the final three months of last year. This was the weakest services growth since the first quarter of 2015.

Output in the consumer-facing distribution, hotels and catering sub-sector dropped by 0.5 per cent in the first quarter. And the transport, storage and communications sub-sector saw a 0.2 per cent drop in output.

The pace of growth in manufacturing output more than halved to 0.5 per cent in the first quarter, from 1.2 per cent in the final three months of last year.

Broader industrial production, which includes the likes of oil and gas extraction and electricity, gas and water supply as well as manufacturing output, rose by 0.3 per cent in the first quarter. It had grown 0.4 per cent in the final three months of 2016.

Martin Beck, senior economic adviser to the EY ITEM Club think-tank, said: “Across the sectors, the weakness was broad-based. The services sector recorded its softest outturn for two years, as high inflation squeezed consumer-facing sub-sectors.

“And hopes the weaker pound would stimulate industrial production were disappointed, after the data at the turn of the year had initially shown some promise.”

Mr Beck signalled a view that the weakness of the first-quarter growth figures meant the Bank of England’s Monetary Policy Committee would not raise UK base rates from their record low of 0.25 per cent in the near future.

He said: “Q1 growth was just half the pace that the Bank of England expected, reinforcing the likelihood of a lengthy period of monetary policy inaction."

Mr Beck added: “The GDP data also contained some important pointers for Q2. The March estimates were lower than the Q1 average for production and construction, and only marginally higher for services, indicating that the economy carried little momentum into Q2.”