SPIKES Government borrowing again as Covid infections surge

Can we provide other insurance? Government borrowing rises again as Covid infections surge as debt cumulative rises to £2.32 trillion

The bleak state of public finances was revealed today as the spread of the Covid and Omicron virus hit the economy.

Government borrowing came in above expectations at £17.4 billion – just £4.9 billion less than last year and the second highest level ever.

Meanwhile, the country’s debt buildup had reached £2.32 trillion by the end of the month – equivalent to 96.1 per cent of GDP, the worst since 1963.

The bleak picture comes amid growing concerns that the resurgence of the virus has spoiled the recovery process.

Government borrowing came in above expectations at 17.4 billion pounds – just 4.9 billion pounds less than last year and the second highest level ever.

Worryingly, inflation is still rising and prompting the Bank of England to raise interest rates – raising the possibility of so-called ‘stagflation’.

For the first time this year, borrowing was above estimates from the Office for Budget Responsibility, which had posted £14.2 billion for the month of November.

Paul Johnson, director of the IFS think tank, said this morning that while the Treasury was still able to borrow Rishi Sunak, it would be concerned about the “medium term” and how the support could be targeted.

Boris Johnson last night backed away from imposing punitive lockdown restrictions that would have ruined Christmas.

At a lengthy cabinet meeting yesterday, several ministers including the chancellor were said to have called for “indisputable evidence” of the Omicron variant before signing off on any further measures.

Cabinet sources said it was now “almost certain” that no new restrictions would be imposed before December 25.

But fears are growing that after Christmas, different families could be prevented from mingling inside their homes – and bars and restaurants forced to operate outside – spoiling the New Year for millions of families.

With plans for a two-week “circuit breaker” still on the table, Johnson warned last night that he must “retain the possibility” of further restrictions to control the spread of Omicron. But he admitted that the data wasn’t clear enough to warrant action now.


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