Day of disaster for coalition

The coalition government is suffering one of its worst weeks in power, as it fights major rows on multiple fronts.

Official figures released this morning found the UK was back in recession, throwing into doubt the government's ability to perform on its central economic agenda and heaping further embarrassment on an already beleaguered chancellor.

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Just as the government was emerging from a series of rows over a badly-received Budget, it was forced to confront a dramatic slump in manufacturing and construction which contrasts horribly with George Osborne's pledge of a "march of the makers".

News: Double-dip is offical – Britain back in recession

The news came as Downing Street was already on the back foot after an explosive evidence session at the Leveson inquiry yesterday.

The inquiry read from emails between Jeremy Hunt's office and that of James Murdoch's which strongly suggested the media secretary was biased in his handling of News Corp's bid for BSkyB.

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Adam Smith, Mr Hunt's special adviser, resigned this morning.

"I appreciate that my activities at times went too far," he said in a statement.

Mr Smith appeared in several of the emails mentioned yesterday in communication with News Corp public affairs executive Frédéric Michel.

The media secretary insisted his special adviser was "a man of dignity" during a bruising session in the Commons this afternoon.

News: Hunt survives Commons statement… for now

Downing Street is hoping Mr Hunt can survive long enough for an early appearance at the Leveson inquiry where he can give his side of the story.

The twin-rows allowed Ed Miliband plenty of ammunition for this week's PMQs, which saw him accuse Mr Cameron of allowing a "shadow of sleaze" to hang over the government.

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Tory MPs are worried the multiple rows will seriously damage the coalition ahead of local elections next week – and even see Boris Johnson lose the London mayoral race.