Reduce my outgoings: Economy might not grow as quickly next year

People who are looking to save money on bills have been warned that the economy might not grow as quickly next year as it has done during quarter two and three of 2010.

Andrew Goodwin, senior economic advisor to the Ernst & Young ITEM Club, said that success this year has been very much down to some "extraordinary construction figures" which are unlikely to be repeated in 2011.

"We could see a very patchy quarter-to-quarter profile too, with the VAT increase likely to distort consumer spending patterns. But overall we still expect a gradual improvement in conditions with 2011 yielding gross domestic product growth of just over two per cent," he added.

Mr Goodwin went on to say that the recent Comprehensive Spending Review has lifted some of the uncertainty and some of the recent stronger economic data has supported confidence.

His words came as the Bank of England's November business conditions survey revealed that investment intentions were reported to have picked up further, despite growth in capital expenditure being comparatively modest.