The UK government already has substantial fiscal commitments, with a national debt standing at around £2.9 trillion. This is much more than a drastic increase over historical averages. This is particularly remarkable when we consider the broad economic environment of the past several decades. The real world dynamics of borrowing change on a monthly basis. So the relevant question concerns the effect of this additional debt on our economy.
For one, investors typically consider UK government bonds—popularly called “gilts”—to be the safest of investments. This repute has been long earned due to their virtually zero risk of default. Investors generally have faith that the federal government—whatever its financial state—will eventually pay off these debts. Our national debt is exploding at an unprecedented pace. Episodes such as the Great Recession and COVID-19 pandemic only deepened concerns about the long-term viability of our borrowing habits.
So far in the last financial year which ends in March 2025, the UK government has borrowed £152.6 billion. This borrowing trend highlights continued fiscal pressures the government is under as it walks the tightrope of supporting ongoing recovery efforts. That’s the total tab the government has racked up, which has more than doubled since the 1980s. This was a massive jump, particularly post the great recession of 2008.
Interest payments on UK government debt have seen a rollercoaster ride over the past several years. In November 2021, public sector net borrowing was £7.4 billion. This graphic illustrates an era of reduced borrowing from what came after. This became even clearer in November 2022, when interest payments rose to £15.5 billion, signalling the growing economic storm. Interest payments have plummeted in the meantime. They fell to £15.0 billion in Nov 2023 and then carried on down to £13.6 billion in Nov 2024. In November 2025, net interest payments fell to £11.7 billion.
Current debt levels are still historically low, at least relative to the size of the UK economy. That’s particularly true when we consider what are dreadful standards by historical measures. The government’s commitment to maintaining economic stability is evident, as highlighted by statements from Downing Street:
“There is no doubt about the government’s commitment to economic stability.” – Downing Street
The monthly borrowing amounts can vary widely. This shows that the UK government continues to have a money management problem—not just an integrity problem. Economic conditions can shift rapidly, influencing both borrowing needs and investor confidence in gilts.
The fiscal impact of the combination of past financial crises and now the pandemic has resulted in unprecedented levels of government borrowing. The high level of national debt raises critical questions about future fiscal policies and the potential impact on public services and economic growth.