Government borrowing in June higher than expected

Total debt – which is the overall amount of money owed by the government that has built up over years – was the equivalent of 99.5% of the size of the UK’s economy as measured by gross domestic product (GDP).

ONS chief economist Grant Fitzner said the fall in June’s borrowing figure reflected “a fall in spending, thanks to lower debt interest payments and the ending of energy support schemes, as well as higher tax revenues”.

Debt interest payments have decreased as some are linked to the rate of inflation, which has fallen over the past year.

However, June’s borrowing figure was higher than the £11.6bn that had been predicted by the government’s independent forecaster, the Office for Budget Responsibility.

“Weaker than expected borrowing so far this year will serve as a reminder to the new chancellor of the huge fiscal challenge she faces ahead of her first Budget this autumn,” said Cara Pacitti, senior economist at the Resolution Foundation.