Government borrowing for October higher than expected

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

The Office for National Statistics (ONS) said borrowing (the difference between public spending and tax revenue) fell to £17.4bn in October, from £19.2bn in the same month last year.

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

ONS chief economist Grant Fitzner said although borrowing was down on the same month last year, it was “still the third-highest October figure on record in cash terms”.

“Although public services and welfare spending increased in October last year, this was more than offset by increases in revenue from taxes and National Insurance contributions,” he said.

Borrowing in the financial year to October stood at £116.8bn; this was £9bn more than over the same seven-month period in 2024. This was the second-highest borrowing from April to October after 2020 since records began in 1993.

The borrowing figures come less than a week before Chancellor Rachel Reeves delivers her Budget, which she has previously confirmed. Both tax increases and spending cuts are on the table.

Treasurer James Murray said currently £1 in every £10 of taxpayers’ money was spent on interest on the national debt.

“This money should go to our schools, hospitals, police and armed forces,” he said.

“Therefore, we are ready to deliver the largest primary deficit reduction in both the G7 and G20 over the next five years to reduce borrowing costs.”

Shadow chancellor Sir Mel Stride said borrowing so far this financial year was the highest recorded outside the pandemic.

“If Labor had a backbone they would control spending to avoid tax rises next week,” he said.