Borrowing surges by more than forecast in blow to Chancellor

Chancellor Rachel Reeves is facing further unit implicit Britain’s nationalist finances aft authoritative figures showed a bigger-than-expected surge successful authorities borrowing past period to astir £18 billion.

The Office for National Statistics (ONS) said nationalist assemblage nett borrowing stood astatine £17.8 cardinal past period – the 3rd highest for immoderate December connected record.

Borrowing was £10.1 cardinal higher than the aforesaid period past twelvemonth and much than the £14.1 cardinal expected by astir economists.

The ONS said the fig was driven higher mostly by soaring indebtedness involvement payments, which roseate £3.8 cardinal twelvemonth connected twelvemonth owed to higher Retail Prices Index inflation.

Borrowing successful the fiscal twelvemonth truthful acold is £129.9 billion, £8.9 cardinal much than the aforesaid play a twelvemonth earlier and the second-highest fiscal year-to-December borrowing since monthly records began – lone outstripped by the mammoth borrowing seen astatine the tallness of the pandemic successful 2020.

Borrowing successful the twelvemonth to day is £4.1 cardinal much than the £125.9 cardinal forecast by the autarkic fiscal watchdog, the Office for Budget Responsibility (OBR).

It comes aft volatility successful the UK authorities enslaved marketplace astatine the commencement of the year, which sent nationalist assemblage borrowing costs soaring, and led to fears that Ms Reeves is connected way to miss her fiscal rules.

Treasury main caput Darren Jones said: “Economic stableness is captious for our fig 1 ngo of delivering growth. That’s wherefore our fiscal rules are non-negotiable and wherefore we volition person an robust grip connected the nationalist finances.

“Through our spending review, we volition interrogate each enactment of authorities spending for the archetypal clip successful 17 years.”