UK debt now larger than size of whole economy

UK debt now larger than size of whole economy

UK debt now larger than size of whole economy

According to the Office for National Statistics, the UK’s debt is now worth more than its economy after the government borrowed a record amount in May.

The £55.2bn figure increase was nine times higher than in May last year.

It is also the highest since records began in 1993.

This is in part due to the furlough scheme, which means that the government is now paying the wages of more than 6.3 million people.

The borrowing splurge sent total government debt surging to £1.95trn, exceeding the size of the economy for the first time since 1963.

Chancellor Rishi Sunak said the figures confirmed the severe impact that the coronavirus pandemic was having on public finances.

“The best way to restore our public finances to a more sustainable footing is to safely reopen our economy so people can return to work.

“We’ve set out our plan to do this in a gradual and safe fashion, including reopening high streets across the country this week, as we kickstart our economic recovery,” he added.

However, the debt increase is not as high as the post-war peak of 258% in 1946-47.

The Chancellor is expected to present a statement on how the UK will recover by July.

A full budget is not expected, although it should include some measures to boost the recovery.

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