Government borrowing soared nearly sixfold in December as overall debt hits record lb2.13 trillion

Government borrowing reached lb34.1 billion recently, bringing the nation's debt to a new all-time high, official figures show.

Public sector bodies borrowed lb2.5 billion more in December compared to what they had a month earlier, and lb28.2 billion more than exactly the same period this past year, a virtually six-fold increase.

November had been the third-highest month for Government borrowing since records began in 1993, based on Office for National Statistics (ONS) data.

December's figure has now overtaken this, to make last month the third-highest on record, the ONS said.

It implies that the public sector has borrowed lb270.8 billion forever from the financial year in April. This really is lb212.7 billion a lot more than in the same period last year.

Even within the financial year starting 2009, within the wake of the economic crash, borrowing only hit lb158 billion.

Austerity

This prompted the austerity policies from the Government led by David Cameron and George Osborne, which got borrowing to below lb50 billion 2 yrs ago.

But regardless of the years of belt-tightening, public sector debt now keeps reaching new record levels as Covid-19 forces the federal government to gain access to more. After December it had once more set an all-time record at lb2.13 trillion.

It implies that debts are now 99.4% how big gdp (GDP), which measures the need for all products or services manufactured in the UK. This level had not previously been reached since 1962, the ONS said.

The Office for Budget responsibility has said it expects the public sector might borrow around lb393.5 billion prior to the end from the financial year, just over 8 weeks from now. That might be the greatest amount in almost any year since the World war 2.

Furlough

The money has been utilized to support parts of the economy, funnelling a lot more than lb46 billion to pay for salaries included in the furlough scheme, and guaranteeing many billions of pounds in loans to businesses.

Added borrowing has also been needed to from the fall in the quantity of tax that HM Revenue and Customs has been in a position to collect.

In December, tax receipts are estimated to have been lb43.6 billion, down lb1.4 billion from the same period in 2021.

There are also notable falls in VAT and business rates.