Inflation pushes UK government interest costs in June to fresh record - BBC

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Surging inflation led interest payments on UK government debt to hit the highest amount on record in June.

Interest payments paid by the government for last month hit £19.4bn.

It pushed government borrowing for the month up from a year earlier to the second highest June level on record.

Borrowing - the difference between spending and tax income - was £22.9bn during the month, up £4.1bn from a year earlier, the Office for National Statistics said.

• Where does the government borrow billions from?

Responding to the figures, Chancellor Nadhim Zahawi said: "We recognise that there are risks to the public finances including from inflation, with debt interest costs in June more than double the previous monthly record.

"That's why the government has taken action to strengthen the public finances, and in their latest forecast the Office for Budget Responsibility [OBR] assessed that we are on track to get debt down."

The £22.9bn figure was the second-highest June borrowing since monthly records began in 1993 and was also £600,000 more than the OBR had forecast.

The recent high levels of debt interest payments are largely a result of higher inflation, the ONS said.

This is due to the interest paid on government bonds rising in line with the Retail Prices Index measure of inflation, which hit 12% in June.

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2022-07-21 06:41:27Z
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