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Economy

UK annual borrowing exceeds $420 bln due to pandemic support measures

Published: Updated:

Emergency pandemic support measures sent UK annual borrowing rocketing to the highest level since World War II, official data showed Friday.

Public sector net borrowing -- the state’s preferred measure of the deficit -- ballooned to £303.1 billion ($420.8 billion, 349.8 billion euros) in the financial year to March, the Office for National Statistics said in a statement.

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That was equivalent to 14.5 percent of gross domestic product (GDP) -- the highest proportion since 1946 when it stood at 15.2 percent.

Borrowing sky-rocketed in the 2020/2021 financial year as the UK government rushed to cushion the economic blow of COVID-19.

And it contrasted sharply with borrowing of just £57.1 billion in 2019/2020.

“The coronavirus pandemic has had a substantial impact on the economy and subsequently on public sector borrowing and debt,” the ONS said Friday.

In March alone, borrowing hit £28 billion as taxation receipts and national insurance contributions tumbled.

Total state debt now stands at £2.141 trillion, or 97.7 percent of GDP -- the biggest proportion since the early 1960s.

Britain is one of the hardest hit countries in the world by the coronavirus pandemic, with a death toll at present of 127,345 people.

Prime Minister Boris Johnson’s government has spent £352 billion in emergency measures, particularly for a furlough scheme that has paid the lion’s share of private sector wages for millions of Britons.

Johnson’s Conservative administration is targeting a phased reopening on the back of a successful vaccine drive, with non-essential retailers reopening for business last week.

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