21 Oct 2020
The UK government’s borrowing surpassed forecasts in September, and in the first half of the financial year was over six times higher than in 2019, due to the mammoth cost of the coronavirus crisis.
This is according to official figures released on Wednesday.
The Office for National Statistics (ONS) revealed that public sector net borrowing reached £36.1 billion in September, £28.4 billion more than in the same month last year, and exceeding the £33.6 billion forecast in a Reuters poll.
This takes total borrowing in the first half of the fiscal year to £208.5 billion.
In addition, the ONS stated that annual consumer price inflation increased in September to 0.5% from August’s figure of 0.2%.
Economists surveyed by Reuters had forecast an average rise in inflation to 0.5%.
UK public borrowing is on track to hitting a record £372 billion this financial year, as per forecasts back in August from the Office for Budget Responsibility, equating to 18.9% of GDP.
On Wednesday, the Treasury announced a one-year spending review to “focus entirely” on tacking the coronavirus pandemic, Sky News reports.
The Treasury said it would "continue to show flexibility and creativity in our response", adding that the review was expected to be finalised at the end of November.
The review would establish departments' resource and capital budgets for 2021-22, as well as the block grants for the devolved administrations for the same time period.
Chancellor Rishi Sunak said the spending review would provide "certainty" on budgets for the upcoming financial year.
He commented on these latest borrowing figures: "Whilst it's clear that the coronavirus pandemic has had a significant impact on our public finances, things would have been far worse had we not acted in the way we did to protect millions of livelihoods.
"I've been clear that our enduring priority is to protect as many jobs and businesses as possible through this pandemic, which is the fiscally responsible thing to do.
"Through our comprehensive Plan for Jobs we're protecting, supporting and creating millions of jobs across the country.”
The Chancellor concluded: "Over time and as the economy recovers, the government will take the necessary steps to ensure the long-term health of the public finances."