UK debt now larger than size of whole economy

The UK’s debt is now worth more than its economy after the government borrowed a record amount in May.

The £55.2bn figure was nine times higher than in May last year and the highest since records began in 1993.

The borrowing splurge sent total government debt surging to £1.95trn, exceeding the size of the economy for the first time in more than 50 years.

Chancellor Rishi Sunak said the figures confirmed the severe impact the virus was having on public finances.

“The best way to restore our public finances to a more sustainable footing is to safely reopen our economy so people can return to work.

“We’ve set out our plan to do this in a gradual and safe fashion, including reopening high streets across the country this week, as we kickstart our economic recovery,” he added.

Income from tax, National Insurance and VAT all dived in May amid the coronavirus lockdown as spending on support measures soared.

This is the first time debt has been larger than the size of the economy since 1963, but it is not as high as the post-war peak of 258% in 1946-47.