Rachel Reeves' stewardship of the economy is in the spotlight (Image: Getty)

       Reform UK has savaged Rachel Reeves' handling of the economy and warned a crisis is coming. Deputy Leader, Richard Tice MP, said borrowing figures out today show Britain's finances are in serious trouble.

       He told the Express: "Despite soaring taxes, government spending is out of control, debt interest has doubled in one month and borrowing is spiralling upwards. Meanwhile, jobs and growth are negative. Unless we urgently change course on spending, a crisis is coming."

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       Official figures released on Tuesday (July 22) show higher-than-expected Government borrowing in June. The Office for National Statistics (ONS) said June borrowing rose to ￡20.7billion last month.

       This is ￡6.6bn higher than a year earlier and the second highest June borrowing since records began, only behind the amount seen in 2020 at the height of the COVID-19 pandemic.

       The ONS said interest payable on debt jumped to ￡16.4bn due to a large rise in Retail Prices Index (RPI) inflation impacting index-linked government bonds.

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       Public sector net debt, excluding public sector banks, stood at ￡2.87trillion at the end of June and was estimated at 96.3% of gross domestic product (GDP), which was 0.5 percentage points higher than a year earlier and remains at levels last seen in the early 1960s.

       Shadow Chancellor, Mel Stride said: "Labour have lost control of the public finances - and because they are too weak to take tough choices on spending, more tax rises are on the way, leaving families facing ever-rising costs.

       "Labour is spending money it doesn’t have, with no plan to pay it back. With debt interest now costing taxpayers double the defence budget, the only certainty under Labour is higher taxes."

       "Only the Conservatives, under new leadership, will restore economic credibility - by protecting taxpayers, backing business, and returning to sound money."

       Darren Jones, Chief Secretary to the Treasury, said: "We are committed to tough fiscal rules, so we do not borrow for day-to-day spending and get debt down as a share of our economy."

       The figures have stoked fears that the Government will be forced to hike taxes in the autumn to help balance the books. They also raised concerns about how markets will react.

       Reform UK Deputy Leader Richard Tice says a crisis is coming. (Image: Getty)

       Liberal Democrat Business Spokesperson Sarah Olney MP told the Express: "It’s time for Rachel Reeves to get serious about growing our economy, which is the best way to fix our public finances and get borrowing down.

       "This means super-charging our small businesses and ditching short-sighted red lines blocking a new UK-EU customs union, which would generate the growth our country desperately needs."

       Nigel Green, CEO of global financial advisory giant deVere Group, told the Express Ms Reeves entered office with a commitment to fiscal responsibility and stability but borrowing is continuing to surge.

       He added: "This isn’t just a hangover from the past. There’s been a marked increase in public spending under her watch and the refusal to revisit departmental budgets while simultaneously ruling out borrowing for day-to-day spending has backed the Treasury into a tight fiscal corner.

       "In that sense, the Government has limited its own room for manoeuvre and markets are recognising that. Investors want credible plans, not just political promises. This is where leadership must meet reality."

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       Colin Low, Managing Director at Kingsfleet, said there may come a time when the borrowing numbers are so huge somebody says "enough is enough" and concludes Britain's debt just can’t be repaid or even serviced.

       He added: "Credibility matters and we must now surely be teetering on the brink. The bond markets could pile pressure on the Chancellor after this data."

       The ONS said so-called compulsory social contributions, largely made up of National Insurance contributions (NICs), jumped by ￡3.1bn to ￡17.5bn last month - the highest ever recorded for June.

       In the first three months of the financial year to date, these compulsory social contributions rose to ￡48bn, up ￡7.5bn year on year and marking another record.

       It followed Ms Reeves's move in April to increase NICs for employers, which has seen wage costs soar for firms across the UK as they also faced a rise in the minimum wage in the same month.

       Samuel Mather-Holgate, Independent Financial Adviser at Mather and Murray Financial, said the Chancellor needs to release some of the pressure on business.

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       He said: "Sky-high National Insurance bills have strangled the prospect of growth, and now there is talk of increasing employer pension contributions. Reeves has got until the autumn to come up with a plan that will stimulate growth in the country."

       Matt Britzman, Senior Equity Analyst at Hargreaves Lansdown, said that despite the June overshoot, borrowing is still adhering to forecasts from the Office for Budget Responsibility.

       He added: "But storm clouds are gathering as weaker tax receipts and soaring debt interest payments signal tougher times ahead."

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