UK Office for Budget Responsibility Sees Economy Shrinking 11.3% in 2020
November 25 2020 - 8:37AM
Dow Jones News
By Jason Douglas
LONDON--The U.K. economy is forecast to record its largest
contraction in 300 years in 2020 and government borrowing will hit
a peacetime record, the country's fiscal watchdog said
Wednesday.
The Office for Budget Responsibility forecasts the economy will
shrink 11.3% in 2020 and public-sector borrowing for the fiscal
year ended in March will reach 394 billion pounds ($526 billion),
equivalent to almost 20% of national income, Treasury Chief Rishi
Sunak told lawmakers.
The figures highlight the heavy cost of the coronavirus pandemic
on the U.K. economy.
"Our health emergency is not yet over and our economic emergency
has only just begun," Mr. Sunak said.
The OBR's forecasts show the economy won't regain its
pre-pandemic size until the final quarter of 2022, a gloomier
prognosis than the Bank of England's.
Mr. Sunak set out spending plans for government departments for
the next fiscal year, telling parliament that he plans to increase
budgets for education and health and spend more on infrastructure
projects.
Write to Jason Douglas at Jason.Douglas@wsj.com
(END) Dow Jones Newswires
November 25, 2020 08:22 ET (13:22 GMT)
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