Fear over the sustainability of any UK economic recovery were fuelled further yesterday by a key survey which indicated nascent growth in the dominant service sector might prove short-lived.

Fear over the sustainability of any UK economic recovery were fuelled further yesterday by a key survey which indicated nascent growth in the dominant service sector might prove short-lived.

Momentum, or rather the potential lack of it, has been the key theme tying together a raft of UK economic data this week.

The Chartered Institute of Purchasing and Supply said yesterday that its headline business activity index for the UK service sector fell from 51.7 in May to 51.6 in June. May had been the first month since April 2008 that the index had come in above the level of 50 which separates expansion from contraction.

Economists seized upon the fact that the June index signalled a marginally slower rate of expansion than the modest pace recorded in May. They viewed this as another reason for fearing that what has begun in recent weeks to look like an emerging recovery in the UK might peter out.

Worries over sustainability of recovery have been voiced recently by such eminent figures as Bank of England Governor Mervyn King.

At best, it looks ever more likely that it will be a long, slow road back for UK economic output. The scale of this slog was underlined this week by revised official data showing that UK gross domestic product slumped by 2.4% in the first quarter of this year alone - the sharpest quarterly drop since 1958. This left it down 4.9% on the same three months of 2008 - the steepest year-on-year plunge since comparable records began in 1948.

A long, steady slog back to economic health, unappetising as it may sound, might be as good as it gets. Economists appear to be chattering ever more about the risks of a w-shaped recession, featuring another relapse, rather than the preferred "v".

And it should be noted that the preferred v-shaped recovery may in any case be much more like sportswear brand Nike's trademark "Swoosh" symbol (a tick to many). Even if things go smoothly, it looks like it will take much longer to get back to pre-recession levels of output than it took to fall from peak to trough (if indeed we have seen the trough).

It is important, however, not to lose heart. A matter of a few months ago, all the talk was around whether the UK was facing a deep recession or a 1930s-style depression.

A depression could involve a reduction in GDP of between 20% and 30%, a contraction on a totally different scale from the peak-to-trough fall of 5% or so being suggested for the UK.

There may well be a danger of a relapse but it is better to be debating whether or not any emerging growth might be sustainable than fretting over whether we are looking at recession or depression.

But the big worry is still the UK banking sector's ability, and willingness, to lend to businesses and households.

Lenders claim they increased the availability of credit to companies in the three months to mid-June and forecast a further rise, in a Bank of England survey published on Thursday, but economists and business leaders are sceptical. The British Chambers of Commerce said it was "particularly concerning" that lending to businesses had not risen by as much as expected in the latest quarter. And it voiced fears that banks would prolong the economic downturn if they did not start "lending effectively".

Availability of credit, for both corporates and households, is absolutely vital for a sustained UK economic recovery. Huge amounts of public money have been employed in an effort to kick-start lending. A gigantic support package has been put in place for the UK banking sector by the government and Bank of England. Base rates have been slashed to a record low of 0.5% by the Bank of England, which is also boosting the UK money supply by £125bn.

There is suspicion among economists that the increase in corporate credit availability reported by lenders might merely reflect commitments made by Lloyds Banking Group, formed by Lloyds TSB's rescue takeover of HBOS, and Royal Bank of Scotland in return for their entry to the UK Government's asset protection scheme. This scheme effectively allows these banks to take out insurance against risky assets.

Economists' suspicion is understandable, given the many horror stories from businesses about their recent dealings with the banks.

It is also noteworthy that the Bank of England's latest quarterly credit conditions survey appears at odds with the hard lending data.

Figures from the Bank of England on Monday showed that M4 lending to private non-financial corporations had fallen by about a further £300m in May, having dropped by £4.5bn in April.

The Bank meanwhile said that UK mortgage lending for all purposes rose by only a net £324m in May - the weakest monthly increase since comparable records began in April 1993. The City had forecast a net increase of £1.1bn.

All of this does not paint a picture of a UK banking sector raring to go when it comes to the task of funding an economic recovery.

It casts doubt on Royal Bank of Scotland chief executive Stephen Hester's assertion that "the banking system in the UK does have adequate wherewithal to support the UK economy with adequate credit". Rather, it supports King's view that "the evidence from prospective borrowers, and the terms on which lenders are willing to extend credit, suggest that banks' ability to finance a sustained recovery remains impaired by low levels of equity capital".

Fears of a w-shaped recession were also voiced in the wake of CIPS' UK construction survey on Thursday - which showed the rate of contraction in this sector accelerating again in June after several months of sharp deceleration.

The continuing surge in UK unemployment meanwhile looks certain to weigh on consumer spending in coming months. Unfortunately, there will be more misery on the jobless front in coming months, regardless of whether economic output crawls upward from here.

And, while the capacity of the banking sector is the immediate worry in the context of recovery, any growth which does emerge would seem likely to be capped over the medium term by the need to tackle the government debt mountain arising from the global economic crisis and measures to combat it.

More positively, another CIPS survey on Wednesday did show UK manufacturing output rising in June for the first time since March 2008.

So it is not all bleak.

It has always looked likely that recovery could be bumpy, perhaps with bursts of growth interspersed with periods of contraction.

What we must hope is that any further episodes of contraction are short and that, from here, the gains outweigh the setbacks. This will almost certainly require more enthusiasm for lending among UK banks. It remains to be seen whether further state intervention will be required to make the banks enthusiastic.