As interest on the eye-watering new record-high £2.4 trillion debt pile increased, the government’s deficit widened more today.
The UK added another £22.9 billion in borrowing in June, the second largest amount ever, with a staggering £19.4 billion going to debt payments.
That was a record high since records began in 1997 and more than double what it was in the same month the previous year. Just under half of the annual defense budget.
The RPI inflation rate, which has been skyrocketing even faster than the headline CPI rate, is correlated with significant sections of the government’s debt stock.
The government is taking action to lessen the debt load, according to Chancellor Nadhim Zahawi, who stated that he “recognized” the risk to the national finances.
According to the independent OBR inspector, interest payments would total £87 billion in this fiscal year.
The dismal statistics, however, may make many wonder how the tax cuts promised during the Conservative leadership race could be implemented.
Former Cabinet minister and Rishi Sunak backer Robert Jenrick attacked competitor Liz Truss this morning, calling her the “antithesis of Thatcherism” for making unfulfilled tax pledges.
‘Of course we want to cut taxes but let’s manage the economy responsibly,’ he told BBC Radio 4’s Today programme.
According to Mr. Zahawi, “We acknowledge that there are threats to the public budget, especially those posed by inflation, with debt interest expenses in June exceeding the previous monthly record by more than double.”
Because of this, the government has taken steps to strengthen the public finances, and according to the OBR’s most recent prediction, we are on schedule to reduce our debt.
According to the Office for National Statistics (ONS), borrowing increased by £4.1 billion in June compared to the same month last year.
It reached £22.9 billion during the course of the month as spending jumped by £9 billion to £86 billion, mostly due to an increase in interest payments of £10.3 billion from the same period previous year.
The TaxPayers’ Alliance’s chief executive, John O’Connell, stated: “These data indicate the expense of servicing the
John O’Connell, chief executive of the TaxPayers’ Alliance, said: ‘These figures show the cost of servicing the national debt is now in the stratosphere.
‘Inflation and out of control public spending threaten to only make matters worse, yet the government seems unwilling or unable to get a grip on the nation’s finances.
‘Ministers must get serious on spending to tackle the towering debt level and ensure taxpayers are protected.’
