In a government report leaked to The Times of London, British Home Secretary Jacqui Smith also says alcohol and tobacco smuggling are likely to rise, more Britons will join terrorist groups and police funding will come under intense pressure.

Smith makes the predictions in a report to Prime Minister Gordon Brown entitled "Responding to Economic Challenges," the newspaper reported Monday. In it, she said based on models developed from studying the 1991-92 recession, violent crime could grow by 19 percent while theft and burglaries could rise by up to 7 percent this year and 2 percent in 2009.

Smith also said there could also be a membership jump in right-wing extremist groups and racism because of "a real or perceived sense of disadvantage held by individuals," the newspaper reported.