Surveys show economy in steep decline

By Christina Fincher

LONDON (Reuters) - The economy went into steep decline at the end of last year with retailers suffering the worst December on record, businesses slashing jobs and home sales slumping to another low, surveys showed on Tuesday.

The British Chambers of Commerce (BCC) urged government to take "additional forceful corrective measures," warning firms were facing the toughest conditions in more than two decades.

The surveys were published as the government prepared to launch measures to help small and medium-sized businesses refinance up to 20 billion pounds of existing loans to prevent credit starved companies from going bust.

The BCC said its quarterly economic survey showed a "frightening deterioration" at the end of last year as sales, orders, investment, employment expectations, cash flow and confidence fell at the fastest pace since its survey began in 1989.

"These are truly awful results with the scale and speed of the economic decline happening at an unprecedented rate," said David Frost, BCC Director General. "Since October, things have really fallen off a cliff."

The British Retail Consortium said retail sales fell last month at their fastest pace for a month of December since its records began 14 years ago.

And Britain's biggest retailer Tesco reported the smallest rise in Christmas sales since the last recession of the early 1990s at its British stores open for at least a year.

"Against the overall background of, I suspect, rising unemployment and economic slowdown it will be a tough year," Finance Director Andrew Higginson told Reuters.