Covid-19: Government borrowing in April climbs to historic high
The Office for National Statistics [ONS] has said that government borrowing reached £62.1 billion in April, the highest monthly amount ever to be recorded, as it grapples with the Covid-19 crisis.
The figure far exceeds the £30.7 billion forecast by economists and is mainly driven by the government’s Job Retention Scheme and loans.
The Job Retention Scheme alone cost the government £14 billion in April. Meanwhile, the ONS deputy national statistician, Jonathan Athow, revealed that the rate of borrowing is now six times higher than at the same stage in 2019.
Athow added that uncertainty made it impossible to predict finances for 2020, but the Office for Budget Responsibility has suggested that the yearly deficit could climb to £298 billion.
Government revenue has been hit hard by falling tax receipts due to the deferral of payments, while income from VAT and air passenger duty is also down due to the lockdown and wider travel restrictions.
Elsewhere, deferrals on mortgage payments for homeowners struggling during the pandemic have been given a three-month extension.
The ONS has also rejigged its figures for government borrowing over March, estimating it to have gone up by £3 billion to a total of £14.7 billion.
The borrowing surge has seen the total public sector debt reach £1,888 billion at the end of April, an increase of £118.4 billion compared to the same stage last year.