Consumers expect to splash out on presents and food this Christmas despite fears the UK could be heading for a recession.

Research by Abbey National found on average people were planning to spend £601 on Christmas shopping - up from £589 last year.

Four per cent of people were planning to splash more than £2,000 on the festive season with two per cent claiming they would spend more than £3,000 on presents, food and decorations.

More than a quarter of people will use their credit cards to help spread the cost of Christmas, while 56 per cent will be raiding their savings.

People aged between 35 and 44 were the biggest likely spenders, expecting to shell out an average of £837 each on Christmas, followed by 24 to 34-year-olds who predicted the festivities would cost them £727.

Despite the overall increase in spending, some age groups were planning to cut their outlay compared to the previous year, with 55 to 64-year-olds planning to reduce this year's bill by £60 to £508.

In the 45 to 54 age group, the trend was to spend an average £633, compared to £675 in 2000.

The announcement of people's spending intentions came as a campaign was launched to warn about the dangers of getting into excessive debt.

Figures from the Bank of England last month showed total UK consumer debt had reached over £700 billion for the first time.

The campaign, from the Office of Fair Trading and the Trading Standards Institute, came at the start of National Consumer Week.

John Vickers, director of Fair Trading, said: "Obtaining credit is becoming ever easier for UK consumers but escaping debt problems is a much harder and more challenging prospect."

The campaign, Keep Debt Under Control, includes leaflets giving advice on a wide range of debt issues.

It suggests consumers should think carefully before signing a credit agreement and shop around for the best deal.