The Office for National Statistics (ONS) stated October’s borrowing reached £22.3bn - £10.8bn more than over the same time period last year. While borrowing in October was lower than economic forecasts and £12.1bn less than during the previous month, it still marks the highest October borrowing since records began and 6th highest monthly total overall.
The second lockdown has caused a renewed rise in the pace of borrowing in the coming months. The expected deficit may reach about £420bn (21.7% of GDP) in 2020/21. Even so, low interest rates mean there is no need to rush to tighten fiscal policy. The borrowing data comes one day after senior Treasury civil servant Tom Scholar told MPs national debt levels could reach 105% of GDP, and that the biggest risk to public finances is any potential for interest rates to begin rising. Over the tax year so far, UK Government borrowing has increased by £169.1bn to £214.9bn, compared to the same period last year.