London Daily

Focus on the big picture.
Wednesday, Aug 13, 2025

COVID-19: Virus fight forces government borrowing to £303bn - highest level since records began

COVID-19: Virus fight forces government borrowing to £303bn - highest level since records began

The latest figures show the national debt has passed £2.1trn as the public finances reel from the cost of the pandemic response.

The demands of the coronavirus crisis on the public purse strings forced government borrowing to its highest annual sum on record, according to official figures.

The Office for National Statistics (ONS) reported net borrowing of £24.3bn in March - a month when the chancellor revealed a budget that pledged continued support for the public health effort and extended shields for the economy from continuing COVID-19 restrictions.

Figures showed that the latest sum took borrowing to £303.1bn in the 2020/21 financial year as a whole, representing 14.5% of GDP.

The ONS said it marked the highest annual total since 1947 - when comparable records began - though it came in well under the £355bn predicted just last month by the Office for Budget Responsibility (OBR).

The start of the financial year was dominated by the crisis as the UK had just entered its first pandemic lockdown, forcing many parts of the economy into a spring hibernation as the NHS grappled surging hospital admissions.

Chancellor Rishi Sunak was forced into 15 separate announcements during the period as a whole, with at least £280bn spent tackling the crisis.

The sum includes extra money for the health service, Test and Trace, vaccines and support schemes including the Job Retention Scheme, or furlough, along with loans and grants for businesses.

The furlough scheme has cost almost £60bn alone and was still supporting five million jobs earlier this month.

The ONS said the £303.1bn borrowing figure followed a deficit of £57bn in the previous financial year.


It meant that the country has net debt of £2.14trn - the highest proportion of GDP since the 1960s.

Mr Sunak used his last budget, in March, to signal that some targeted tax rises were on the way to help ease the deficit including a freeze in the personal income tax allowance.

But he said the emphasis would be on supporting growth in the economy as it looks to bounce back from 2020 that saw output plunge almost 10% - its worst performance in more than 300 years.

There are some encouraging early signs as the country emerges from its latest lockdown restrictions.

A closely-watched reading of activity in the manufacturing and powerhouse service sectors of the economy highlighted a deluge of new orders earlier this month.

The IHS Markit/CIPS preliminary "flash" composite purchasing managers' index rose to 60.0 in April from 56.4 in March, its highest reading since November 2013.

Any reading above 50 represents growth.

Separate ONS figures released on Friday showed retail sales rebounding strongly last month despite the fact many so-called non-essential retailers were unable to reopen their doors across much of the UK until 12 April.

Volumes rose 5.4% compared with February with fashion seeing the biggest leap of 17.5%.

The proportion of cash spent online fell as more people ventured out, the figures showed.

The data builds on the findings of surveys suggesting that services, construction and manufacturing are all gearing up to cash in on pent-up demand.

Newsletter

Related Articles

0:00
0:00
Close
U.S. Investigation Reports No Russian Interference in Romanian Election First Round
Oasis Reunion Tour Linked to Temporary Rise in UK Inflation
Musk Alleges Apple Favors OpenAI in App Store Rankings
Denmark Revives EU ‘Chat Control’ Proposal for Encrypted Message Scanning
US Teen Pilot Reaches Deal to Leave Chile After Unauthorized Antarctic Landing
Trump considers lawsuit against Powell over Fed renovation costs
Trump Criticizes Goldman Sachs Over Tariff Cost Forecasts
Perplexity makes unsolicited $34.5 billion all-cash offer for Google’s Chrome browser
Kodak warns of liquidity crisis as debt obligations loom
Cristiano Ronaldo and Georgina Rodríguez announce engagement
Taylor Swift announces 12th studio album on Travis Kelce’s podcast after high-profile year together
South Korean court orders arrest of former First Lady Kim Keon Hee on bribery and corruption allegations
Asia-Pacific dominates world’s busiest flight routes, with South Korea’s Jeju–Seoul corridor leading global rankings
Private Welsh island with 19th-century fort listed for sale at over £3 million
JD Vance to meet Tory MP Robert Jenrick and Reform’s Nigel Farage on UK visit
Trump and Putin Meeting: Focus on Listening and Communication
Instagram Released a New Feature – and Sent Users Into a Panic
China Accuses: Nvidia Chips Are U.S. Espionage Tools
Mercedes’ CEO Is Killing Germany’s Auto Legacy
Trump Proposes Land Concessions to End Ukraine War
New Road Safety Measures Proposed in the UK: Focus on Eye Tests and Stricter Drink-Driving Limits
Viktor Orbán Criticizes EU's Financial Support for Ukraine Amid Economic Concerns
South Korea's Military Shrinks by 20% Amid Declining Birthrate
US Postal Service Targets Unregulated Vape Distributors in Crackdown
Duluth International Airport Running on Tech Older Than Your Grandmother's Vinyl Player
RFK Jr. Announces HHS Investigation into Big Pharma Incentives to Doctors
Australia to Recognize the State of Palestine at UN Assembly
The Collapse of the Programmer Dream: AI Experts Now the Real High-Earners
Security flaws in a carmaker’s web portal let one hacker remotely unlock cars from anywhere
Street justice isn’t pretty but how else do you deal with this kind of insanity? Sometimes someone needs to standup and say something
Armenia and Azerbaijan sign U.S.-brokered accord at White House outlining transit link via southern Armenia
Barcelona Resolves Captaincy Issue with Marc-André ter Stegen
US Justice Department Seeks Release of Epstein and Maxwell Grand Jury Exhibits Amid Legal and Victim Challenges
Trump Urges Intel CEO Lip-Bu Tan to Resign Over Alleged Chinese Business Ties
Scotland’s First Minister Meets Trump Amid Visit Highlighting Whisky Tariffs, Gaza Crisis and Heritage Links
Trump Administration Increases Reward for Arrest of Venezuelan President Maduro to Fifty Million Dollars
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
OpenAI Launches GPT‑5, Its Most Advanced AI Model Yet
Embarrassment in Britain: Homelessness Minister Evicted Tenants and Forced to Resign
President Trump nominated Stephen Miran, his top economic adviser and a critic of the Federal Reserve, to temporarily fill an open Fed seat
The AI-Powered Education Revolution: Market Potential and Transformative Impact
Chikungunya Virus Outbreak in Southern China: Over 7,000 Hospitalized
French wine makers have seen catastrophic damage to vines that were almost ready to be harvested after the worst fires in more than 70 years burned through the south of the country
US Lawmaker Probes Intel CEO’s China Ties Amid National Security Concerns
Brazilian President Lula says he’ll contact the leaders of BRICS states to propose a unified response to U.S. tariffs
Trump Open to Meeting Putin as Soon as Next Week, with Possible Trilateral Summit Including Zelenskiy
Katy Perry and Justin Trudeau spark dating rumors, joining high stakes world of celeb-politician romances
US envoy Steve Witkoff arrived in Moscow to seek a breakthrough in the Ukraine war ahead of President Trump’s peace deadline
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
×