Tax hikes and spending cuts worth an extra £39bn every decade for the next 50 years would be needed to prevent ballooning national debt levels, the UK’s fiscal watchdog has warned.
The Office for Budget Responsibility’s latest Fiscal Sustainability Report makes for grim reading as it warns over the outlook for government borrowing and debt levels following the recent NHS spending pledge.
Unless the Government takes action, the OBR estimates the main budget deficit would rise from 0.3 per cent in 2022-23 to 8.6 per cent of gross domestic product by 2067-68 – a rise equivalent to £176.5bn a year.
This would mean public sector net debt would jump from 80 per cent of GDP in 2022-23 to 282.8 per cent by 2067-68.
It said the Government’s promise to spend £20bn extra on the NHS is alone responsible for pushing up borrowing forecasts by 1.5 per cent of GDP.