Labour's Record £20.7B Borrowing Raises Economic Concerns
Rachel Reeves, the current Chancellor of the Exchequer, has faced criticism for borrowing £20.7 billion in June, setting a new record. This overspend, which exceeds the total revenue from her tax hikes, has raised concerns about Labour's economic approach.
Economists predict further tax rises in the autumn, including increases on pensions and 'sin taxes'. Markets reacted to the borrowing figures, with 10-year yields surging to 4.64% and housebuilders' shares falling. Higher interest payments and weaker revenues pushed borrowing above projections for the second month in a row.
Labour's first three months in charge have seen borrowing explode, economic growth retreat, interest costs spiral, and tax receipts falter. The Treasury borrowed £20.7 billion in June, £6.6 billion more than last year and £3.5 billion higher than forecast. Debt interest now costs taxpayers £100 billion annually, nearly double the defence budget, and could rise to £130 billion under Labour. The UK economy is stagnating, with tax receipts falling while government spending rises, creating a potential £30 billion black hole in public finances.
Rachel Reeves' borrowing figures have sparked concern about Labour's economic management. With the UK economy stagnating and tax receipts falling, the government faces a significant challenge in balancing the books.
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