FOR the first time since 1960, the UK Government’s debt of just over £2 (€2.2) trillion is greater than Gross Domestic Product (GDP) according to the Office for National Statistics (ONS).
Debt had been creeping up during the latter part of 2019 but the lockdown and pandemic has hit Britain badly and the fact is that for the past four months spending has exceeded tax income.
In the short term, the situation will get worse as the Government will need to fund the next round of Self-Employed Income Support and also settle the Eat Out scheme.
Analysts forecast that once these two significant amounts are paid, the need to borrow will drop especially as company VAT payments will be due and the Furlough scheme will finish.
Britain will not benefit in the way that Italy and Spain have from the financial support from the European Union and the Chancellor of the Exchequer Rishi Sunak will have to be creatively cautious in his Autumn budget and hope that significant trade deals following final Brexit divorce are just around the corner.