Another month, guess what, take a lucky guess, it is the same old story, HM Government, spends more money than it receives via taxes and duties.
Now we are in a Covid 19 world. UK’s HM Government needs to fund many new demands.
Another deficit month, thus to bridge the gap, needs to borrow on the bond market In August 2020 , the HM Government had to borrow money to meet the difference between tax revenues and public sector expenditure. The term for this is The PSNCR: The Public Sector Net Cash Requirement. There were “only” 14 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office to raise cash for HM Treasury:-
26-Aug-2020 0 3/8% Treasury Gilt 2030 2,750.0000 Million
25-Aug-2020 0 1/8% Treasury Gilt 2026 3,000.0000 Million
25-Aug-2020 1 5/8% Treasury Gilt 2054 1,342.3750 Million
20-Aug-2020 0 1/8% Index-linked Treasury Gilt 2028 3 months 1,374.9990 Million
19-Aug-2020 0 7/8% Treasury Gilt 2029 3,437.5000 Million
18-Aug-2020 0 1/8% Treasury Gilt 2023 4,062.4970 Million
18-Aug-2020 0 5/8% Treasury Gilt 2050 2,477.2500 Million
12-Aug-2020 0 1/8% Treasury Gilt 2028 3,437.4990 Million
11-Aug-2020 0 5/8% Treasury Gilt 2025 3,250.0000 Million
11-Aug-2020 1¾% Treasury Gilt 2057 1,250.0000 Million
05-Aug-2020 0 1/8% Index-linked Treasury Gilt 2048 3 months 562.2500 Million
05-Aug-2020 0 3/8% Treasury Gilt 2030 2,750.0000 Million
04-Aug-2020 0 1/8% Treasury Gilt 2026 4,062.4990 Million
04-Aug-2020 1¼ % Treasury Gilt 2041 2,812.4990 Million
Thus:
2,750.0000 Million+3,000.0000 Million+1,342.3750 Million+1,374.9990 Million+3,437.5000 Million+4,062.4970 Million+2,477.2500 Million+3,437.4990 Million+3,250.0000 Million+1,250.0000 Million+562.2500 Million+2,750.0000 Million+4,062.4990 Million+2,812.4990 Million = £36569.368 Million
That is £36.569368 Billion
On another way of looking at it, is in the 31 days in August 2020, HM Government borrowed:- £1.179657032 Billion each day for the 31 days.
We are fortunate, while the global banking and financial markets still has the confidence in HM Government to buy the Gilts (Lend money to the UK), the budget deficit keeps rising. What is also alarming, is the dates these bond mature from 2023 through to 2057. All long term borrowings, we are mortgaging our futures, but at least “We Are In It Together….”