Rise in disposable income fails to boost household spending British households are still spending significantly less than pre-recession levels despite a recent rise in disposable income. In the 18 months to September 2011, the latest figures show disposable income increased by £4bn, but household spending only increased by a quarter of that. In a report by the Office of National Statistics (ONS) released today, it was revealed that household spending began to fall before the recession even hit - peaking at the end of 2007. The UK was officially in a period of recession from the second quarter of 2008 until the second quarter of 2009. Since household spending peaked it has fallen by £12bn, but disposable income is at a similar level. John Ibbotson, director of the retail consultancy Retail Vision, said: "This report confirms what anyone who is struggling to make ends meet has long suspected; that nearly three years after the official end of the recession, the bleak economic outlook and fragile jobs market are still squeezing consumer spending. Discretionary spending plummeted during the recession, and despite a modest recovery thereafter, it is still anaemic at best. The victims of this squeeze on consumer spending include "semi-discretionary" big-ticket items such as white goods and cars. The report said "households were cautious about major non-essential purchases, but prepared to spend where they saw value for money." Spending on restaurants and hotels, predictably, fell during the recession but have seen an increase in activity since.