- February borrowing came in at £8.4 billion, higher than the £6 billion economists had expected
- Borrowing for the year to date stands at £106.8 billion – £4.6 billion less than for the same period last year
- Cash coming in jumped by £7.2 billion compared to February 2023 as threshold freezes, higher corporation tax rates and inflation boosted receipts
Danni Hewson, AJ Bell head of financial analysis, comments on the latest UK public sector finances:
“The wheels might not be coming off entirely but they’re certainly wobbling. Just weeks after Jeremy Hunt announced supposed vote-winning tax cuts amid speculation that further giveaways are in the offing, it emerges the government has had to borrow more than had been expected for the month of February.
“That’s despite the end of universal support for energy bills, fiscal drag that’s seen income tax receipts rise considerably and falling inflation which has helped keep a lid on interest costs.
“Debts swelled by £157.4 billion when compared to a year ago – now 97.1% of GDP and continuing to be at levels last seen in the 1960s. Cost of living support payments will come to an end, but uprated benefit costs will have to be factored into the sums of any chancellor making tax and spend decisions for the future.
“The good news is that this is the fourth month in a row when borrowing was down compared to the year before. There are tentative signs that the volatility created by the pandemic and the energy crisis is behind us, though the legacy left behind will weigh on public finances for generations to come.”
