Alistair Darling will admit in next month’s pre-Budget report that the recession has been much deeper than he forecast in March, the FT has learnt. The chancellor is expected to say that the economy contracted by 4.75% in 2009, shrinking at least one percentage point more than predicted in the Budget. But he will also say that the UK is finally on the road to recovery, ahead of a probable general election in May. The Treasury’s forecasts assume the economy has started growing again in the final three months of this year, said insiders.

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