British Chancellor of the Exchequer Alistair Darling is reportedly set to downgrade his growth forecast for 2008 amid signs Britain's economy is facing a slowdown.
The Treasury said Mr Darling will deliver the Government's Comprehensive Spending Review and Pre-Budget Report in a statement to MPs next Tuesday.
In an interview with the Financial Timestoday, Mr Darling said the global credit squeeze would have "some effect" on the United Kingdom.
The paper reports that Mr Darling will downgrade his 2.5-to-3 per cent growth forecasts for next year.
Independent economic forecasters have revised down their growth forecasts for 2008, with the consensus standing at 2.2 per cent compared with a 2.75 per cent mid-point Treasury forecast, the paper states.
Mr Darling said: "If you look at the consensus of the economic forecasters, it would be prudent to assume that [the credit squeeze] will have some effect on us here."
The paper went on to say that Mr Darling had said his three-year public spending statement projects above-inflation growth, with generous settlements for health and education.
Mr Darling also delivered a warning that public sector pay awards had to be kept under control.