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Government debt soars to £1 trillion

Government debt soars to £1 trillion

Category: Debt

Updated: 24/01/2012
First Published: 24/01/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Government borrowed less money in December than a year previously, but it could not stop national debt hitting the £1 trillion mark.

It is the highest public sector debt recorded since figures were first compiled in 1993.

In the monthly public sector finances bulletin released by the Office for National Statistics (ONS), figures showed that borrowing amounted to £13.7 billion in December - £2.2 billion down on the same month in 2010.

It means that the Chancellor remains on track to achieve his spending target of £127 billion for the financial year, with the total currently standing at £103.3 billion.

Government spending fell by 0.9% in the month, reflecting the current effort to pay down the UK 's debts.

As for money coming into the economy, receipts were boosted by the higher rate of VAT and the bank levy.

Next month's figures are likely to be boosted by the sale of Northern Rock to Virgin Money and the increased tax receipts from people completing their self assessment tax returns.

Despite this, the Government could not avoid the current national debt – excluding the effects of bailing out the banks – rising to £1,003.9 billion.

At the same point in 2010, the national debt stood at £883 billion.

The current size of the debt is equivalent to almost two thirds (64.2%) of the UK 's GDP.

The Treasury said that the current levels of debt reflect the unsustainable level of spending which was built up by the last government.

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