Breaking News: UK Government Borrowing Rises to £13.7bn in August
In a shocking development, the UK government has announced that its borrowing has surged to £13.7 billion in August, a significant increase from the £7.9 billion borrowed in the same month last year. This marks the largest August borrowing figure since 2001, according to the Office for National Statistics (ONS).
The staggering increase in borrowing is largely attributed to the ongoing pandemic, which has resulted in a significant decline in economic activity and a subsequent reduction in tax revenues. Additionally, the government’s spending has increased to support the economy and mitigate the impact of the pandemic.
According to the ONS, the public sector net borrowing (PSNB) deficit for August 2022 was £13.7 billion, which is a 73% increase compared to the same period last year. This is also the largest August borrowing figure since 2001, when the PSNB deficit was £14.5 billion.
The news has sent shockwaves through financial markets, with the pound falling against the dollar and government bond yields rising in response to the increased borrowing. The news has also sparked concerns about the sustainability of the government’s debt levels, which have reached record highs.
Reactions from Economists and Politicians
Economists have warned that the surge in borrowing could lead to a increase in borrowing costs and potentially even a rise in interest rates. "This is a wake-up call for the government and the Bank of England," said Vicky Pryce, a former chief economic advisor to the government. "The government needs to get a grip on its spending and start to reduce its borrowing if it wants to avoid a fiscal crisis."
The Chancellor of the Exchequer, Kwasi Kwarteng, has attributed the increased borrowing to the pandemic and has vowed to take action to reduce the deficit. "We are taking swift and decisive action to support the economy and mitigate the impact of the pandemic," he said. "We will continue to work hard to reduce the deficit and ensure that our economy is strong and resilient."
Key Statistics
- Public sector net borrowing (PSNB) deficit for August 2022: £13.7 billion
- Increase in borrowing compared to August 2021: 73%
- Largest August borrowing figure since 2001
- Public sector net debt (PSND) at the end of August 2022: £2.22 trillion
- PSND as a percentage of GDP: 98.5%
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[UK] – Government borrowing rises to £13.7bn in August | BBC
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