National debt set to hit £2trn
The cost of the coronavirus crisis is set to see Britain’s national debt reach £2trn for the first time, with projections from the Office for Budget Responsibility suggesting the milestone will be hit next month. Hitting the £2trn mark – a decade after the £1trn point was first exceeded – would push national debt beyond 100% of national income for the first time since the end of the Second World War. This forecast comes in the wake of a Bank of England warning that Britain faces the deepest recession for more than 300 years, while borrowing this year is predicted to reach £300bn. Philip Booth, senior academic fellow at the Institute of Economic Affairs, said the likely scale of the national debt following the pandemic “will be staggering”, adding: “We cannot just deal with this by more austerity.” Howard Archer, chief economic adviser at EY Item Club, said the level of debt was “extraordinary and very much a sign of the times we are living in”, but said the “huge” debt is “a price worth paying” to try and limit long-term damage to the economy.