The British economy grew 0.5 per cent between July and September, but there were fears that the figure might represent a high point as manufacturing went into decline. With the decision by the Greek government to hold a referendum on the bail-out deal also triggering new fears of a worldwide recession, business leaders were also pessimistic. And yesterday Mr Osborne clashed with shadow chancellor Ed Balls as he was accused of “choking off” the recovery with his deep and rapid cuts to public spending. Mr Balls told him: “These figures have shown that the British economy has grown over the past 12 months, since your spending review, by just 0.5 per cent, and Treasury officials have apparently admitted to the BBC this afternoon that the economy is now set to worsen.” He said the International Monetary Fund had said that if the British economy “continues to undershoot”, the Chancellor should “change course to boost growth and jobs”. Mr Balls asked: “How much longer does the country have to wait before the Chancellor will finally listen?” But Mr Osborne said: “He not only ducks deficit reduction, he runs away from it and we are clearing up the mess he left when he was running Britain’s economic policy for 13 years.” Meanwhile, making her frontbench debut in Treasury questions, Kilmarnock and Loudoun Labour MP Cathy Jamieson accused the government of making women take the burden of the cuts. She said: “For too long, women have been made to shoulder a disproportionate burden of the government’s austerity drive, with huge cuts in direct support for children and childcare making it harder for mums to go back to work and massive reductions in the public sector workforce hitting women even harder than men. “With female unemployment at its highest level since 1988, it’s time for the government to stop its attack on women and outline what they are going to do to help those who are struggling to find employment.” A Markit/CIPS survey yesterday showed the manufacturing sector slipped into decline in October, fuelling fears the economy could contract in the final quarter of 2011. Meanwhile, UK consumers are reining in spending as living standards face the biggest squeeze since the 1920s amid spiralling inflation and the government’s austerity measures. The Office for National Statistics said the riots in August did not have a noticeable effect on the overall GDP figure. It said the economy has grown by 0.6 per cent over the previous two quarters, which gives a clearer picture of the underlying trends. This means the economy is growing at half the speed of long-term trends, which have seen it expand at an average of 0.6 per cent every quarter in recent decades. The previous quarter had been hit by the unusually warm spring, which caused households to turn off their heating early, disruption to the supply chain following the Japanese tsunami and the extra bank holiday for the Royal Wedding. Graeme Leach, chief economist at the Institute of Directors, said: “Unfortunately, we don’t think the crisis is over. It will continue to haunt recovery prospects in the UK.”