London Daily

Focus on the big picture.
Saturday, Aug 02, 2025

National debt interest payments rise to record £70bn

National debt interest payments rise to record £70bn

Despite public finances improving last year, 2021 still ranked as the third highest year ever for government borrowing.

Interest payments on the national debt rose to their highest level ever last year, as the UK’s public finances reel from the huge cost of the pandemic.

The government’s statistics department said the debt pile stood at £2.3tn last month, with interest payments rising to nearly £70bn, a record amount according to the Office of National Statistics (ONS).

Government borrowing last year was down by half on 2020, when the state paid many workers to stay at home in an attempt to control the spread of COVID-19.

Yet 2021 still ranked as the third highest on record for public borrowing. The state deficit hit £151.8bn in the 12 months to March 2022, compared to £317.6bn in the previous year.

Despite the reduced level of borrowing, the government still borrowed £24bn more than expected last year.

Chancellor Rishi Sunak said that while the state’s finances were improving with the reopening of society, heavy borrowing throughout the pandemic had left the government saddled with debt.

“Public debt is at the highest levels since the 1960s and rising inflation is pushing up our debt interest costs, which mean we must manage public finances sustainably to avoid saddling future generations with further debt,” said Mr Sunak.

The phasing out of COVID-19 restrictions has boosted the government’s coffers in the past year, according to the ONS.

Tax income to the government was £619.9bn in the past year, an increase of £94.3bn on 2020.

The national debt pile stood at £2.3tn last month


“This is a real glass half full moment for the UK economy,” said Danni Hewson, AJ Bell financial analyst. “The phasing out of covid restrictions and the end of support measures like the furlough scheme have helped the country surge back to its feet.”

Mr Hewson pointed out, however, that inflation was likely playing a significant role in the higher tax receipts.

“VAT receipts are up by £25bn and those soaring prices at the pump along with the restart of the ‘big commute’ has netted an extra £5bn in fuel duty,” he said. But “that doesn’t minimise the £22.5bn in extra PAYE or £6.8bn from self-assessment payments.”

The country is now facing a cost of living crisis that is only likely to worsen Britain’s public finances.

Many people in Britain are facing an increase in energy bills, council tax and the effects of a National Insurance tax rise - as well as inflation hitting a 30-year-high of 7% earlier this month.

On Tuesday, a minister warned that there was "no golden bullet" to solve the crisis, as Boris Johnson prepares to ask his Cabinet ministers to help him find solutions to ease the pressure on household finances.

Armed Forces minister James Heappey told Sky News there is "no doubt" that any interventions by the government will be "expensive", but added that "cumulatively" a range of measures could "start to make a difference".

"There's no doubt about these interventions are expensive - £22bn of government intervention to assist with families with their cost of living is already huge," he said.

Comments

Oh ya 3 year ago
Wel i am sire glad panatimes told us that. I can sleep better now. Maybe next week we can find out about how panama is doing financially seeing this is were the readership lives. That being said with the US debt at about 31 trillion we know they have to borrow 1/2 of the money every year to service it. When you have to borrow money to pay interest the end is near.

Newsletter

Related Articles

0:00
0:00
Close
Trump Threatens Canada with Tariffs Over Palestinian State Recognition
Trump Deploys Nuclear Submarines After Threats from Former Russian President Medvedev
Trump Sues Murdoch in “Heavyweight Bout”: Lawsuit Over Alleged Epstein Letter Sets Stage for Courtroom Showdown
Germany Enters Fiscal Crisis as Cabinet Approves €174 Billion in New Debt
Trump Administration Finalizes Broad Tariff Increases on Global Trade Partners
J.K. Rowling Limits Public Engagements Citing Safety Fears
JD.com Launches €2.2 Billion Bid for German Electronics Retailer Ceconomy
Azerbaijan Proceeds with Plan to Legalise Casinos on Artificial Islands
Former Judge Charged After Drunk Driving Crash Kills Comedian in Brazil
Jeff Bezos hasn’t paid a dollar in taxes for decades. He makes billions and pays $0 in taxes, LEGALLY
China Increases Use of Exit Bans Amid Rising U.S. Tensions
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Procter & Gamble to Raise U.S. Prices to Offset One‑Billion‑Dollar Tariff Cost
House Republicans Move to Defund OECD Over Global Tax Dispute
Botswana Seeks Controlling Stake in De Beers as Anglo American Prepares Exit
Trump Administration Proposes Repeal of Obama‑Era Endangerment Finding, Dismantling Regulatory Basis for CO₂ Emissions Limits
France Opens Criminal Investigation into X Over Algorithm Manipulation Allegations
A family has been arrested in the UK for displaying the British flag
Mel Gibson refuses to work with Robert De Niro, saying, "Keep that woke clown away from me."
Trump Steamrolls EU in Landmark Trade Win: US–EU Trade Deal Imposes 15% Tariff on European Imports
ChatGPT CEO Sam Altman says people share personal info with ChatGPT but don’t know chats can be used as court evidence in legal cases.
The British propaganda channel BBC News lies again.
Deputy attorney general's second day of meeting with Ghislaine Maxwell has concluded
Controversial March in Switzerland Features Men Dressed in Nazi Uniforms
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
Thai Civilian Death Toll Rises to 12 in Cambodian Cross-Border Attacks
TSUNAMI: Trump Just Crossed the Rubicon—And There’s No Turning Back
Over 120 Criminal Cases Dismissed in Boston Amid Public Defender Shortage
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
Trump Announces $550 Billion Japanese Investment and New Trade Agreements with Indonesia and the Philippines
US Treasury Secretary Calls for Institutional Review of Federal Reserve Amid AI‑Driven Growth Expectations
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Severe Flooding in South Korea Claims Lives Amid Ongoing Rescue Operations
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
CEO Resigns Amid Controversy Over Relationship with HR Executive
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
US Revokes Visas of Brazilian Corrupted Judges Amid Fake Bolsonaro Investigation
U.S. Congress Approves Rescissions Act Cutting Federal Funding for NPR and PBS
North Korea Restricts Foreign Tourist Access to New Seaside Resort
Brazil's Supreme Court Imposes Radical Restrictions on Former President Bolsonaro
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Judge Criticizes DOJ Over Secrecy in Dropping Charges Against Gang Leader
Apple Closes $16.5 Billion Tax Dispute With Ireland
×