Overview
- The OBR reports that UK government debt stood at 94% of GDP at end-2024 and rose to 96.4% by May, ranking sixth highest among advanced economies.
- Reversals of planned welfare benefit cuts and the reinstatement of winter fuel payments have added over £6 billion to borrowing requirements ahead of the autumn Budget.
- Attempts to put public finances on a more sustainable footing have achieved only limited and temporary success, as planned tax rises and spending reductions were largely abandoned.
- Structural obligations – notably the cost of the state pension triple lock, planned defence spending rising to 5% of GDP by 2035 and climate adaptation measures – pose mounting pressures on future budgets.
- Without further reforms, the OBR projects national debt will exceed 270% of GDP by the early 2070s due to expanding pension, defence and climate-related commitments.