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UK Prime Minister: Government Will Stick To Austerity Plans

LONDON -(Dow Jones)- Official figures showing the U.K. has slipped back into recession are disappointing, but the coalition government will stick to its austerity plans and keep interest rates low, Prime Minister David Cameron said Wednesday. U.K. gross domestic product fell 0.2% in the first quarter of this year after a 0.3% contraction in the final three months of 2011. It is the first time the economy has contracted for two consecutive quarters--the standard definition of a recession--since early 2009. "This is a tough and difficult situation that the economy is in, but the one thing we mustn't do is abandon public spending and deficit reduction plans because the solution to a debt crisis cannot be more debt," he told parliament. Cameron also said he had full confidence in culture minister Jeremy Hunt. Hunt is under pressure to resign over his dealings during media company News Corp's (NWS, NWSA) efforts to gain full control of British Sky Broadcasting Group PLC (BSYBY, BSY.LN). News Corp. owns Dow Jones & Co., publisher of this newswire and The Wall Street Journal. -By Nicholas Winning, Dow Jones Newswires, +444 207 842 9498; nick.winning@dowjones.com

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