Public debt in October is higher than expected

UK government borrowing was more than £2 billion higher than expected in October, according to the latest official figures.

Borrowing – the difference between public spending and tax revenue – was £17.4bn in October, up from £19.2bn in the same month last year, the Office for National Statistics (ONS) said.

Analysts expected government borrowing to be £15bn in October, slightly higher than the Office for Budget Responsibility’s (OBR) March forecast of £14.4bn.

ONS chief economist Grant Fitzner said that while borrowing was down compared to the same month last year, it “remains the third highest figure on record for October in cash terms”.

“Although spending on public services and benefits increased in October last year, this was more than offset by higher income from taxes and National Insurance contributions,” he said.

In the financial year to October, borrowing was £116.8bn, £9bn more than in the same seven-month period in 2024. It was the second highest April-October borrowing since records began in 1993, after 2020.

The borrowing figures are known less than a week before chancellor Rachel Reeves reveals her budget, and she has previously confirmed that both tax rises and spending cuts are on the table.

Chief Secretary to the Treasury James Murray said £1 in every £10 of taxpayers’ money was currently being spent on interest on the national debt.

“That money should go to our schools, hospitals, police and military,” he said.

“That is why we are prepared to achieve the largest reduction in the primary deficit in both the G7 and the G20 in the next five years: to reduce borrowing costs.”

Shadow chancellor Sir Mel Stride said borrowing so far this financial year had been the highest on record apart from the pandemic.

“If Labor had the guts, they would rein in spending to avoid tax rises next week,” he said.