Ed Balls speaking at Labour's Yorkshire conference
The current global recession is "the most serious for over 100 years", cabinet minister Ed Balls has said.
Mr Balls, a former economic adviser to Gordon Brown, said it was "more extreme and more serious than that of the 1930s", the Yorkshire Post reported.
He told a Labour conference that these were "seismic events that are going to change the political landscape".
Shadow Treasury minister Phillip Hammond said the remarks were "staggering and very worrying".
Mr Balls, the schools secretary, made the comments at Labour's Yorkshire conference at the weekend, the newspaper reported.
The BBC's political editor Nick Robinson said Mr Balls and Downing Street have attempted to play down the significance of his remarks, insisting he had been pointing out the unique nature of the global financial crisis and was not predicting that the impact on ordinary people would be worse than that experienced during the Great Depression of the 1930s.
According to the Yorkshire Post, he said: "The economy is going to define our politics in this region and in Britain in the next year, the next five years, the next 10 and even the next 15 years.
"These are seismic events that are going to change the political landscape.
"I think that this is a financial crisis more extreme and more serious than that of the 1930s and we all remember how the politics of that era were shaped by the economy."
Mr Balls, MP for Normanton, added: "We now are seeing the realities of globalisation, though at a speed, pace and ferocity which none of us have seen before.
"The reality is that this is becoming the most serious global recession for, I'm sure, over 100 years as it will turn out."
For the Conservatives, shadow Treasury minister Phillip Hammond said: "This is a staggering and very worrying admission from a cabinet minister and Gordon Brown's closest ally in the Treasury over the past 10 years.
"We are being told that not only we are facing the worst recession in 100 years, but that it will last for over a decade - far longer than Treasury forecasts predict."
He added: "Is Ed Balls spilling the beans here and telling us that the government sees the situation as slightly more serious than they have tried to portray?"
Government ministers are oscillating between complacent optimism and this doom-laden picture of Armageddon
Liberal Democrat Treasury spokesman Vince Cable contrasted Mr Balls' assessment with comments from fellow minister Baroness Vadera, who recently said she could see "green shoots" of economic recovery.
He said: "Instead of giving clear and consistent leadership, government ministers are oscillating between complacent optimism and this doom-laden picture of Armageddon. Surely the truth lies between the two?"
A spokesman for Mr Balls insisted that the prime minister and Chancellor Alistair Darling had highlighted the "unprecedented speed and ferocity" of the crisis "time and time again".
He said: "The unprecedented global nature of this crisis and its impact on the global financial sector is affecting every single economy in the world.
"The Bank of England agrees with this analysis. As the deputy governor of the Bank of England, Charlie Bean, said in October: 'This is a once in a lifetime crisis, and possibly the largest financial crisis of its kind in human history."'
He added the minister had been referring in his speech to the differences between Labour and the Conservatives on the economy.
Last week, Mr Brown used the word "depression" during prime minister's questions, but his spokesman later said this had been a slip of the tongue.
The Conservatives urged him to clarify his comments and be careful with language.
The Commons Treasury Select Committee is due to question the bosses and former bosses of the UK's biggest banks on Tuesday and Wednesday over the causes of the financial crisis.
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