The UK's national debt has passed £3trillion for the first time in history, while inflation has climbed to 3.5%, according to new figures released by the Office for National Statistics. The data comes just days before John Healey is due to deliver his first Budget as Chancellor under Prime Minister Andy Burnham.
Debt and inflation rise sharply
Inflation now stands at its highest level since last October. The national debt has risen by about 50% since June 2020, when it stood at £2trillion. The figures have prompted criticism from opposition politicians and campaigners, who accuse the Labour government of economic mismanagement.
Critics fear the upcoming Budget could contain several tax rises to help fund increases to the benefits system. The government has already suggested it could hike taxes on several sectors and abolish the triple lock, which has angered British pensioners.
Political reaction
Andrew Griffith, the Shadow Chancellor, said the statistics "show Labour has lost control of the economy". He added that the Budget, due next week, "needs to take urgent action to tackle the deficit, reduce the red tape and net zero costs that are driving up the cost of living for families".
Conservative leader Kemi Badenoch has repeatedly called Labour the "welfare party". Work and Pensions Secretary Pat McFadden was reported to have said his MPs were always asking: "Who can we tax to pay for more benefits?"
Reform UK's Robert Jenrick said: "Inflation is running out of control because Burnham won’t make the choices that would cut people’s bills." He suggested cutting "benefits for foreigners, overseas aid, and net zero" to lower bills, but warned the Prime Minister would not do so "because he’s too weak to give this country the change that it needs".
Campaigners and government response
Darwin Friend of the TaxPayers' Alliance called the debt level a "grim milestone", branding it "a damning indictment of decades of fiscal failure" and warning that borrowing would only rise, leaving taxpayers "paying a terrifying price for Whitehall’s addiction to spending".
Mr Healey has pledged to give households "breathing space" in the Budget and claimed the economy had "momentum". He said the government would continue "maintaining our fiscal discipline and drive for growth in every postcode" in next week's Budget.
