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Retailers endured their worst Christmas in more than a decade, new figures show, as "frightening" warnings over the UK economy are sounded.

In the first substantial high street figures for December, like-for-like sales were down 3.3 per cent, the worst in the history of the British Retail Consortium's (BRC) 14-year monthly survey.

At the same time as the publication of the "truly dreadful" retail figures, other UK businesses have reported a "disturbing" drop in sales.

According to the British Chambers of Commerce an "alarming collapse in confidence" was felt by 6,000 businesses it surveyed during December.

And in its latest figures the Organisation for Economic Cooperation and Development (OECD) showed the leading index for the British economy fell 6.7 points in November compared to the corresponding month in 2007.

Commenting, shadow chief secretary to the Treasury Philip Hammond said: "This shocking news underlines the true scale of Gordon Brown's recession and the extent of the challenge that faces the next government in rebuilding Britain's economy.

"It is now imperative that the government acts to implement the Conservatives' proposed national loans guarantee scheme. Unless we get credit flowing again, more businesses will fail and more jobs will be lost".

According to the BRC, total sales on the high street during last month were down 1.4 per cent compared to the previous December; another record low.

Food and footwear were the only sectors to enjoy slight rises, as clothing, furniture and big ticket homewares all suffered.

The BRC's director general Stephen Robertson, who has called on the government to stop "piling new burdens" on retailers, explained: "Some retailers were more successful than others and the second half of December was better than the first. But overall the food sector was almost the only one to show growth.

"And even this was at the slowest rate since last March."

Helen Dickinson, head of retail at KPMG, added that the outlook for retail in 2009 was "indeed bleak" and said the situation "doesn't look like changing any time soon".