Chancellor Alistair Darling's hopes for a speedy economic recovery to offset a record borrowing binge were branded "wishful thinking" by critics.
Public borrowing will soar to a record £175 billion in the current year, or 12.4% of the UK's annual economic output, Mr Darling said.
Including the £90 billion borrowing for 2008/09, total net borrowing is forecast to hit £696 billion by 2012/13 - almost £240 billion more than forecast in November's Pre-Budget Report.
He confirmed 2009 as the worst year for the economy since the Second World War - with output set to fall 3.5% - but said recovery would be under way by the end of the year and forecasted 1.25% growth in 2010.
The Treasury will bid to close the gap between dwindling tax receipts and soaring spending by selling £220 billion in gilts, or Government-backed debt - a new record.
Peter Spencer, chief economic adviser to the Ernst & Young ITEM Club, said Mr Darling's estimates were unrealistic and called the Budget "disappointing".
"According to the Chancellor's wishful thinking, the recession will end later this year and a V-shaped recovery will then ensue.
"That bounce looks highly unlikely, especially as the huge stimulus that has been applied to the economy .....continued below
Advertisement starts
Advertisement ends
will have to be reversed quickly to prevent inflation," he said.Mr Darling is pinning his hopes on a fast recovery next year due to interest rates at record lows of 0.5% and the Bank of England's unprecedented £75 billion programme of quantitative easing - printing money.
But the International Monetary Fund dealt a blow to this confidence with its latest forecast of a further 0.4% decline in output in 2010, on top of a 4.1% slump this year.
Richard Lambert, director-general of the CBI business group, said the Budget did not provide a "a credible and rigorous path" for restoring the public finances to health.
"The Chancellor's economic forecasts for next year and beyond look optimistic," he added.
Conservative leader David Cameron attacked the soaring levels of borrowing unveiled. He said Mr Darling had written himself into the history books and "written a whole chapter in red ink".
Mr Darling will attempt to restore the public finances through measures such as raising the 45% top-rate tax unveiled in November for those on wages of £150,000 or more to 50%, cutting back pension tax relief, as well as further hikes in alcohol, tobacco and fuel duties.
Tax loopholes will also be closed to gain an extra £1 billion in revenues along with a fiscal tightening equivalent to 0.8% a year from 2010-11 to 2013-14, the Chancellor said.
But the measures announced by the Chancellor today will add just £5.2 billion to Exchequer revenues by 2011/12, the Budget documents showed.
"The painful tax announcements have just been deferred to the other side of the election. In the meantime we must hope that overseas investors do not find this Budget as disappointing as we do," Mr Spencer added.
