U.K. Deficit Hits $323 Billion With Economy Facing Recession
- Figures reflect cost of supporting businesses through pandemic
- Recovery in doubt after government tightens coronavirus curbs
U.K. government borrowing climbed to a record 240.9 billion pounds ($323 billion) in the first eight months of the fiscal year, reflecting the damage inflicted on an economy now at risk of falling back into recession.
In November alone, spending exceeded tax revenue by 31.6 billion pounds amid the escalating cost of supporting firms and households through the pandemic, Office for National Statistics figures published Tuesday showed. It leaves Britain facing its largest ever peacetime budget deficit.
Separate figures confirmed the economy rebounded strongly in the third quarter. But a contraction is expected this quarter, and hopes of recovery early next year are fading after the government tightened restrictions to combat a mutated coronavirus and several European countries banned entry from Britain. Meanwhile, deadlocked talks over a Brexit trade deal are heading toward a Dec. 31 cliff edge.