UK government borrowing reached £35.5bn in June

Borrowing in first quarter of financial year more than double whole of 2019-2020

Samuel Osborne
Tuesday 21 July 2020 08:01 BST
Rishi Sunak visits a Jobcentre Plus in Barking, east London
Rishi Sunak visits a Jobcentre Plus in Barking, east London (Anthony Upton/The Daily Telegraph/PA)

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Louise Thomas

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Government borrowing reached £35.5bn in June, around five times more than the same month last year, due to the soaring cost of the coronavirus crisis.

June saw the third highest amount borrowed for any month on record, the Office for National Statistics (ONS) said.

The figures mean borrowing in the first quarter of the financial year was more than double the £55.4bn seen in the whole of the previous year as the UK spent heavily on emergency support measures during the lockdown.

The latest numbers take government debt to £1.98 trillion, which is equivalent to 99.6 per cent of gross domestic product (GDP) – the highest debt to GDP ratio since 1961, according to the ONS.

However, borrowing last month was lower than the amount expected by most economists and less than the downward revised £45.5bn recorded for May.

The figure fell as the cost of the government’s furlough scheme dropped back to just over £9bn as some firms began to recall staff, while the vast majority of the payment to self-employed workers was also made in May.

The ONS said the UK central government spent £80.5bn in June, up by a quarter year on year.

The central government net cash requirement was also more than borrowing – at a record £47.1bn – due largely to the additional cost of loan schemes.

The ONS said more than 30 coronavirus support schemes have been announced in total by the UK government and the devolved administrations to help Britain weather the pandemic.

Rishi Sunak, the chancellor, said: “It’s clear that coronavirus has had a significant impact on our public finances but we know without our response things would have been far worse.

“The best approach to ensure our public finances are sustainable in the medium term is to minimise the economic scarring caused by the pandemic.

“Our plan for jobs does this by providing significant and targeted support where it’s needed the most, to ensure nobody is left without hope as we reopen our economy.

“I am also clear that, over the medium term, we must, and we will, put our public finances back on a sustainable footing.”

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