(Reuters) - Spending by households drove Britain's economic recovery once again in the third quarter despite a slight fall in disposable incomes and weaker business investment growth than previously reported, official data showed on Tuesday.

The economy grew by 0.7 percent in the July-September period from the second quarter, in line with a previous estimate and slowing only a bit from a revised 0.8 percent between April and June.

In annual terms, growth was revised down to 2.6 percent from a previous reading of 3.0 percent, hurt by lower business and government investment and higher imports than thought in an earlier estimate. Household spending rose 0.9 percent from the April-June period, picking up speed from the second quarter, and was the main driver of growth.

The data showed consumers dug into their savings. Household disposable income, after tax and inflation, fell 0.1 percent on the quarter and was up only 1.0 percent on the year, reflecting weak pay growth that has raised questions about the durability of the economic recovery.

Weak earnings have also put the issue of living standards at the centre of campaigning for Britain’s national elections in May.

Business investment, which is considered crucial to ensure the economy continues to grow, fell 1.4 percent from the second quarter and was up 5.2 percent compared with a year earlier, the Office for National Statistics said.

Both readings were weaker than the previous estimate for the third quarter. Britain's economy struggled to grow in the years after the financial crisis and, despite a strong recovery since early 2013, it remains only 2.9 percent larger than its pre-crisis peak.

The ONS had said previously that the economy was 3.4 percent bigger than its previous peak but adjusted the figure to reflect revisions to economic growth. The ONS also released third-quarter current account data, which showed that Britain's deficit with the rest of the world rose to 27.0 billion pounds, equivalent to 6.0 percent of GDP, matching the biggest deficit on record.