Andy Haldane, the executive director for financial stability at the Bank of England has said that the financial crisis may have been as devastating to the world as the world war.

"In terms of the loss of incomes and outputs, this is as bad as a world war. It would be astonishing if people weren't asking big questions about where finance has gone wrong If we are fortunate, the cost of the crisis will be paid for by our children. More likely it will still be being paid for by our grandchildren," he said.

According to estimates, the economy is still 3pc smaller than at its peak even four years after the crisis.

It is estimated that the Chancellor George Osborne might have to look for a further 11 billion pounds of tax increases or cuts as the plans for cuts extend beyond the election period. IFS estimates that the total borrowing would come in at 133 billion pounds during the year till March 2013. Experts say that week economic performance since March indicates that the government might be forced to make more cuts and also record an increased borrowing for the year next month.

It said that Chancellor George Osborne might have to forget austerity goals next month. Osborne is scheduled to update the country's parliament on rowing and growth forecasts on December 5 and is likely to suggest keeping on track to meet austerity targets.