Public sector debt has reached a new record high of £2.08 trillion at the end of October after Government borrowing hit £22.3 billion last month, according to official figures.
The Office for National Statistics (ONS) said borrowing for the first seven months of the financial year is now estimated at £214.9 billion – the highest in any April to October period since records began in 1993.
It means that the UK’s overall debt has reached around 100.8% of gross domestic product (GDP) – a levels not seen since the early 1960s – as the Government has invested billions of pounds in supporting the economy through the pandemic.
October borrowing, excluding state-owned banks, was also a record and marked a £10.8 billion increase year-on-year.
Chancellor Rishi Sunak said: “We’ve provided over £200 billions of support to protect the economy, lives and livelihoods from the significant and far-reaching impacts of coronavirus.
“This is the responsible thing to do, but it’s also clear that over time it’s right we ensure the public finances are put on a sustainable path.”
The Chancellor will use next week’s spending review will limit pay rises in the public sector to at or below inflation, the Daily Mail reported.
Only frontline NHS doctors and nurses will be exempt from the cap in recognition of their work during the coronavirus pandemic, the paper said.
However teachers, police, members of the armed forces as well as NHS managers will all be affected.
The move is likely to be met with fury by public sector unions who say their members bore the brunt of Conservative austerity cuts following the global financial crisis.
The Chancellor is already under fire over widespread reports he is preparing to set aside the commitment to spend 0.7% of national income on overseas aid as he looks for savings.
The Treasury would not comment on the reports ahead of the Chancellor’s statement on Wednesday.
However, launching the spending review in July, Mr Sunak warned of the need for “restraint” in future public sector pay settlements.
