Highest December borrowing on record as UK national debt approaches 100% of GDP

The Office for National Statistics (ONS) today announced that the UK government borrowed £34.1 billion last month - the highest December figure on record.

The UK's national debt now stands at £2.14 trillion, which represents 99.4% of GDP - a level not seen in the UK since the 1960s. In order to reduce the level of national debt, Chancellor Rishi Sunak will have to tighten fiscal policy once the UK economy starts to recover from the pandemic.

It is likely that he will hold off on any tax increases until 2022 but when they are introduced they could be quite sharp. The government will have the 2024 general election in the back of its mind and will want to be seen to make progress on reducing its current debt:GDP ratio before voters go to the polls.