UK govt borrowing less than expected in good news for chancellor

The treasury borrowed less than expected in November, as a previous reduction in inflation pushed down interest rates on government bonds.

Economists had predicted public sector net borrowing last month would be about £13bn. 

But figures from the Office for National Statistics (ONS) show the sum was actually £11.2bn. 

Borrowing is the difference between public sector spending and income. 

In November 2023, the government borrowed £3.4bn more, with today’s figures recording the lowest November borrowing for three years.

ONS deputy director for public sector finances Jessica Barnaby said: “Central government tax receipts grew compared with last year, while increased spending on public services and on benefits were offset by lower debt interest payable.” 

The figures will give a small boost to Chancellor Rachel Reeves, who has been under pressure following the tax-raising autumn budget.

She announced the biggest tax increases in three decades in October, but promised to balance day-to-day spending with tax revenues by the end of the decade.

She also plans to increase borrowing sharply in the coming years as the new Labour government seeks to improve public services and invest more in infrastructure.