22nd Oct 2024 07:11
(Alliance News) - UK public sector borrowing spiked in September, ahead of the government's budget next week, amid lofty interest payable on government.
According to the Office for National Statistics, public sector net borrowing amounted to GBP16.61 billion in September, stretching from GBP13.02 billion in August and GBP14.48 billion a year prior.
It was the "third highest September borrowing since monthly records began in January 1993", the ONS said.
"The interest payable on central government debt was GBP5.6 billion in September 2024, GBP4.6 billion more than in September 2023; this was owing to the interest payable in September 2023 being exceptionally low at GBP900 million because of movements in the retail price index around that time, rather than September 2024's interest being unusually high."
Public sector net debt, excluding public sector banks, was estimated at 98.5% of gross domestic product in September, sitting at levels last seen since the "early 1960s", but fading slightly from 98.8% in August. Net debt to GDP was at 86.2% in September 2023.
"Excluding the Bank of England, debt was 91.2% of GDP, 5.0 percentage points more than at the end of September 2023 but 7.3 percentage points lower than the wider debt measure," the ONS added.
The reading comes just over a week before UK Chancellor Rachel Reeves sets out the government's budget announcement.
The Cabinet is united on the UK government's spending plans, Reeves has insisted.
The chancellor was reportedly locked in negotiations with some ministers until last week as she sought GBP40 billion of tax rises and spending cuts ahead of the announcement on October 30.
Speaking to the PA news agency, Reeves said the final settlements had been confirmed but acknowledged it had been "right for all Cabinet members to want to get the best settlement for their departments".
She added that settling departmental budgets was "an important achievement and shows the determination of this government to get a grip of the public finances, and shows that we are as one, united in fixing the mess that the Conservatives left for us".
Several ministers were reported to have written to the prime minister to express concern about the scale of cuts being demanded in some areas as the chancellor attempts to find GBP40 billion with which to deliver Labour's promises.
By Eric Cunha, Alliance News news editor
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