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UK debt cranks up amid political tussles

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By Chathushka Perera

London, UK (CWBN)_ Political infighting has been plaguing British politics for months, in both sides of Westminster, although its immediate effects had not tangibly manifested until recently.

Just last month, the incumbent Prime Minister, Boris Johnson, established that a trade deal would be very unlikely, as Brexit negotiators, led by David Frost, remain at loggerheads with European Union counterparts, led by Michel Barnier, even as the economy faced serious recession (-20.4%) during the 2nd quarter, and the government’s anaemic response to the Covid-19 outbreak.

As a result of the differences in Downing Street, Lee Cain, the PM’s Director of Communications, and his close-colleague, Dominic Cummings, who played the role of Chief of Staff, resigned from their posts just hours apart. Both men were staunch supporters of the “Leave Vote” and followed Johnson following former PM Theresa May’s dismissal.

Meanwhile, then Opposition Leader, Jeremy Corbyn, was suspended by the Labour Party following his attempts to downplay three serious breaches of the Equalities Act (2010), with regard to his handling of complaints received by the party concerning anti-Semitism, claimed on a Equality  and Human Rights Commission (EHRC) report.

The issue took new turns these past few days as Sir Keir Starmer, the new part leader, refused to allow his predecessor to return as a Labour MP, despite a decision made by the party’s Disputes Panel to reinstate Corbyn’s membership.

As previously reported, Corbyn retains considerable influence over Labour, such that several council members resigned from their posts, in protest of Starmer’s decision. Moreover, accusations are being levied that the leftist approach of the party is being compromised by the decision.

Starmer, who also possess similar influence and the support of many Jewish leaders and members, has reportedly informed his adversary of a continue three month suspension, earlier today.

Against this backdrop of chaos, Chancellor of the Exchequer, Rishi Sunak, stated that public sector debt has reached over GBP 2.08 trillion (USD 2.76 trillion) thus far into the fiscal year. Although borrowing was as high as GBP 22.3 billion (USD 29.61 billion) in October, it was a significant drop from the projections for 28.6 billion (USD 37.93 billion) made in September.

Sunak said that the government “provided over £200 billions of support to protect the economy, lives and livelihoods from the significant and far-reaching impacts of coronavirus. This is the responsible thing to do, but it’s also clear that over time it’s right we ensure the public finances are put on a sustainable path.”

According to the Office of National Statistics (ONS), spending last month was valued at GBP 214.9 billion (USD 285.17 billion) and was the highest recorded October since 1993. The independent department estimates that under the circumstances, the fiscal year would conclude in March 2021, with the value reaching 372.2 billion (USD 360.96 billion).

With an expense review due in the coming weeks, Sunak has imposed a freeze on public sector pay, excluding healthcare workers. It is expected to affect millions of households dependent on public sector employees and has a good chance of pitting them against the government.

As per a recent survey reported that up to 90% UK’s workforce is dependent on the furlough schemes, which still leaves many of them unable to maintain regular expenses on food, utilities and rent.

Meanwhile, StepChange, a debt-charity based in Leeds, reported that unemployment and business, among other factors related to the pandemic, have affected about 15 million people (one-third of the adult population), despite furlough support. Moreover, 1.2 million people were classified as critically affected.

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