UK Chancellor of the Exchequer says debt will fall as a percentage of GDP in the medium term

UK Chancellor of the Exchequer says debt will fall as a percentage of GDP in the medium term

UK Chancellor of the Exchequer Kwasi Kwarteng walks outside Downing Street in London, UK, Sept. 23, 2022. REUTERS/Maja Smiejkowska

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LONDON, Sept. 23 (Reuters) – Britain’s Chancellor of the Exchequer Kwasi Kwarteng said on Friday the government would publish a plan to reduce debt as a percentage of gross domestic product (GDP) as he outlined an expensive package to help people support with energy bills and tax cuts.

The UK Debt Management Office said it increased its debt issuance plans for the current fiscal year by £72.4 billion ($81.0 billion) to £234.1 billion in response to the announcements.

“In due course, we will publish a medium-term fiscal plan, outlining more fully our responsible fiscal approach, including how we plan to reduce debt as a percentage of GDP over the medium term,” Kwarteng said in a budget statement to parliament.

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Kwarteng said the energy support package would cost £60 billion ($67.22 billion) over the next six months, while the announced tax cuts are estimated to be worth £45 billion. read more

He said the Office for Budget Responsibility would release a full economic and fiscal forecast before the end of the year, incorporating the costs of the measures announced Friday.

In March, the independent OBR forecast a loan of £99.1 billion for fiscal year 2022/23 and £50.2 billion for 2023/24, equivalent to 3.9% and 1.9% of gross domestic product respectively.

($1 = 0.8925 pounds)

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