THE latest figures from the UK Office of National Statistics (ONS) will make painful reading for the British government and Chancellor Rishi Sunak as borrowing for the month of April 2020 was £62.1 billion (€68.4 billion), the highest amount since records were first kept.
It is easily understandable that this need for cash has been caused in the fight against Covid-19 as the government has stepped in to help guarantee furloughed employees wages whilst tax income has fallen by 26.5 per cent when compared to April 2019 receipts.
Borrowing in the latest full financial year (April 2019 to March 2020) is estimated to have been £62.7 billion (€62.9 billion), £22.5 billion (€24.8 billion) more than in the previous financial and as can be seen, April’s borrowings almost equate to the entire borrowing of the previous year.
The ONS has indicated that these figures are estimates and will be adjusted as more information becomes available but the inference is that they are likely to be higher rather than lower when finalised.
It was also announced that net public sector debt at the end of April 2020 was £1,887.6 billion (€2,076) which equates to 97.7 per cent of GDP and it should be remembered that during the last financial crises, Spain was criticised by the European Union when its borrowing exceeded GDP for a while.
The April 2020 figure shows an increase of overall debt of £118.4 billion (€130 billion) over the April 2019 figures and represents a growth in indebtedness of 17.4 per cent and is the largest increase in debt since 1993 when figures started to be compiled.
Once the country has recovered from the virus that has affected so many, the British government is going to have a very difficult and potentially longer job to try to get the economy back to a healthy condition.