Government borrowing for October higher than expected

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

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

Analysts had 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 while borrowing was down compared to the same month last year, it was “still the third-highest October figure on record in cash terms”.

“While spending on public services and benefits were both up on October last year, this was more than offset by increased receipts from taxes and National Insurance contributions,” he said.

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

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

Chief Secretary to the Treasury James Murray said at the moment £1 of every £10 in taxpayer money was spent on interest on national debt.

“That money should be going to our schools, hospitals, police and armed forces,” he said.

“That is why we are set to deliver the largest primary deficit reduction in both the G7 and G20 over the next five years – to get borrowing costs down.”

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

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