UK debt at 100.6% of GDP

Chancellor Rishi Sunak has alluded to the possibility of a hike in taxes as the UK faces up to holes in its finances following the economic impact caused by nationwide lockdowns.

Public debt grew by £8bn in January, the Office for National Statistics has revealed.

Following the release of government figures recentlySunak said:

“We’ve been able to respond comprehensively and generously through this crisis because of our strong public finances.”

“Therefore, it’s right that once our economy begins to recover, we should look to return the public finances to a more sustainable footing and I’ll always be honest with the British people about how we will do this.”

While it is the first time there has been a deficit in January in over a decade, the figure was lower than the £24.5m forecasted by economists.

Government spending during January 2021 rose by over 30% from the year before to £81.9bn.

During 2020/21, the UK is forecast to record a deficit of £350bn, the highest as a proportion of GDP (17%) since the second world war.

In total, government debt stands at 100.6% of UK GDP, according to the ONS. UK debt is now in excess of £2.1trn, following continuously high rates of borrowing during the pandemic.