The British government may be forced to seek a loan from the International Monetary Fund (IMF) due to economic problems, according to Cambridge University Professor Yajit Chadha, quoted by The Daily Telegraph.
“I can imagine that this will happen and in that case we will find ourselves in a difficult situation. We will not be able to refinance debts due to the terms of the loan, we will not be able to pay pensions, it will be difficult to pay benefits“, he said. The economist stressed that the UK economy is on the brink of collapse. He compared the current situation to the situation in the country in 1976, when London, against the backdrop of high energy prices and deindustrialization, eventually turned to the IMF for a loan.
Earlier, former UK Foreign Secretary (2001-2006) Jack Straw said in an interview with The Times that the British government would have to raise taxes to meet its commitments to increase military spending. According to him, the cabinet would be forced to “make serious cuts, primarily in the social security budget“.
In March 2025, the UK Minister of Work and Pensions, Liz Kendall, announced that the Labor government would complicate the rules for receiving a number of social benefits in order to save 5 billion pounds ($6.8 billion) in budget funds annually. Last autumn, British authorities raised some taxes and scrapped winter fuel payments for most pensioners, citing a "black hole" in the budget.