UK Public Borrowing Higher Than Expected

Public sector net borrowing (excluding public sector banks) in the UK widened to £18.0 billion in August 2025 from £14.4 billion in the same month last year, exceeding market expectations of £12.8 billion. This marked the highest August borrowing since 2020. Total public sector spending increased by £8.4 billion, driven by higher costs of public services, benefits, and debt interest. Meanwhile, total receipts rose by £4.8 billion, reflecting stronger central government tax and National Insurance contribution revenues. Borrowing for the financial year to August reached £83.8 billion, £16.2 billion more than in the same period of 2024 and the second-highest April-to-August total since monthly records began in 1993, after 2020. This was also £11.4 billion higher than the £72.4 billion forecast by the OBR in March. Public sector net debt excluding public sector banks stood at 96.4% of GDP at the end of August.