LONDON (AFP) — The global credit crunch will likely fuel a surge in crime, racism, smuggling and even terrorism in Britain, according to a leaked government document aired Monday.
The draft letter from Home Secretary Jacqui Smith to Prime Minister Gordon Brown's office warns of a potential increase in violent offences due to the economic downturn and soaring food prices.
The letter was prepared after Brown ordered government departments to report back on how the credit crunch would affect them.
The leak comes after finance minister Alistair Darling warned in an interview published Saturday that economic conditions were "arguably the worst" in 60 years and admitted people were "pissed off" with the government as Britain's growth slowed to a halt.
"There is a risk of a downturn increasing the appeal of far-right extremism and racism, which presents a threat as there is evidence that grievances based on experiencing racism are one of the factors that can lead to people becoming terrorists," the letter said.
It indicated there would be "increased public hostility to migrants" as competition for jobs gets tougher.
Home Office minister Tony McNulty played down the warning.
"We've never made any pretence that the economy and crime are inextricably linked," he told BBC radio.
"This really is, I think, a statement of the blindingly obvious.
"Previous experience dictates that when you have a slowdown in the economy, some aspects of crime may go up... unemployment may go up; you can work out the scenario for yourself."
He said it was the government's duty to consider "what may happen in the worst of scenarios".
Home Office officials looked at past recessions to gauge their impact on crime and concluded that it was likely to rise -- particularly property crime, such as burglary and car break-ins.
Smuggling and illegal working is expected to rise as employers seek to "save costs", the leaked letter said.
A Home Office spokesman said: "We do not normally comment on leaked documents but this is draft advice that the home secretary has not cleared and has not been sent to Number 10.
"It is, however, appropriate that the Home Office considers the effects the economic climate may have on crime and other policy areas.
"We are confident that we have the right systems in place to respond."
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