UK borrowing surges past official forecasts as Chancellor prepares for first budget

The ONS said that authorities borrowing roseate to £16.6bn past month, up £2.1bn year-on-year and marking the 3rd highest September borrowing since records began arsenic nationalist assemblage wage hikes took their toll

Chancellor Rachel Reeves is facing a situation arsenic she prepares for her archetypal Budget, with caller information showing authorities borrowing has exceeded predictions.

The Office for National Statistics (ONS) reported that nationalist assemblage nett borrowing for the archetypal fractional of the fiscal twelvemonth deed £79.6bn – an summation of £1.2 cardinal from the erstwhile twelvemonth and £6.7bn much than the Office for Budget Responsibility (OBR), the autarkic fiscal watchdog, had anticipated.

Last period saw authorities borrowing ascent to £16.6bn which is £2.1bn much than the aforesaid play past twelvemonth and represents the 3rd highest September borrowing connected record, driven by rises successful nationalist assemblage wages. This occurred contempt a simplification successful cardinal authorities payment payments, partially owed to Labour's determination to means trial the wintertime substance allowance, which is distributed successful November and outgo astir £2bnlast year.

Although September's borrowing was little than the £17.5bn forecasted by astir economists, the year-to-date figures inactive transcend OBR's estimates, complicating matters for Ms Reeves arsenic the Budget approaches. Treasury Chief Secretary Darren Jones highlighted the precarious authorities of nationalist finances, indicating that the October 30 Budget volition impact "difficult decisions".

He remarked: "We person inherited a £22bn achromatic spread successful the country’s nationalist finances, including nary program to money wage deals for millions of nationalist assemblage workers."

"Strikes outgo astatine slightest £3bn past year, truthful it was the close happening to bash to extremity those damaging disputes."

"Resolving this achromatic spread astatine the Budget adjacent week volition necessitate hard decisions to hole the foundations of our system and statesman delivering connected the committedness of change."