London - Sana
Britain's public borrowing increased again last August, reaching a new record high, driven by huge spending to combat the Coronavirus, with the budget deficit exceeded since the beginning of the current tax year at its peak for a full year during the global financial crisis.
Reuters reported that the British government borrowed 137.7 billion pounds, equivalent to 221.8 billion dollars, in the first five months of the fiscal year that begins in April, exceeding the record of 157.7 billion pounds in the twelve months ending in March 2010.
Those providing government budget forecasts have warned that the deficit could reach 372 billion by the end of the tax year, which would raise borrowing as a percentage of GDP to 18.9 percent, a level not recorded since World War II and far exceeding the long-term debt sustainability rates.
For his part, British Finance Minister Rishi Sunak called yesterday to focus on restoring growth and not reducing borrowing, pointing to the necessity of making difficult decisions in the longer term.
British borrowing jumped in August alone to 35.9 billion pounds, below the average analyst forecast of 38 billion dollars, while the July figure was revised down by 11 billion to 15.4 billion pounds.
Net public sector debt stood at 2.024 trillion pounds, or 101.9 percent of GDP, the highest as a percentage of the economy since the 1960-1961 fiscal year.
Britain suffered the greatest economic damage among any of the G7 economies from the Corona virus in the second quarter of this year, as production collapsed by 20 percent.