Pandemic debts hit £450bn David Smith in Sunday Times reflects on the impact the pandemic has had on public finances, with official figures covering the 2021/22 fiscal year showing that the deficit fell from £317.6bn in 2020/21 to £151.8bn. He says that the Office for Budget Responsibility was “too optimistic”, with the deficit coming in £24bn above the forecast it made last month, before noting that “the gap should narrow as later data comes in.” Mr Smith highlights that public sector net debt was more than £2.3trn and equivalent to 96.2% of GDP at the end of March, while at the end of March 2020, the debt was nearly £1.8trn - or 82.8% of GDP. Government debt at the end of March was £551bn up on two years earlier and, relative to GDP, it rose from just over 80% to close to 100%. Mr Smith calculates that the cost of the pandemic to the public finances, in terms of the addition to government debt, is about £450bn. Suggesting that there will be further costs down the line, he adds: “It is, of course, too soon to close the books on the pandemic.”