British’s budget deficit swelled further in May, taking government debt above 100% of gross domestic product for the first time since the financial year ending 1963.
Borrowing stood at 55.2 billion kilos ($69 billion) final month, the Office for National Statistics mentioned Friday. It brings the whole for the reason that begins of the fiscal yr in April to 103.7 billion pounds, the most important two-month whole on the document. It is the biggest two-month total on record.
The increase reflects the cost of Chancellor Rishi Sunak’s unprecedented interventions to help prop up the economy, and the deficit is likely to swell further this year. The government is currently paying the wages for almost 12 million jobs and more stimulus including tax breaks and infrastructure projects potentially in the pipeline.
The figures show central government spending surged almost 50% in the month and revenue plunged by over 28%. Net debt including Bank of England programs jumped to 100.9% of GDP.
The saving grace for Sunak is that support from the Bank of England is keeping borrowing costs manageable. The central bank increased its bond-buying plan by 100 billion Pounds on Thursday, leaving them on track to buy almost 300 billion pounds of gilts by the end of the year.