
UK borrowing rises to £10.7bn in setback for Rachel Reeves
UK government borrowing rose by more than expected in February to £10.7bn, underscoring the challenge for Rachel Reeves before next week’s spring statement.
Figures from the Office for National Statistics showed borrowing – the difference between total public sector spending and income – was little changed from the same month a year earlier. However, over the financial year to date borrowing was up nearly £15bn on the same period last year.
In a setback for the chancellor, the monthly total was higher than expected in a Reuters poll that predicted a deficit of £6.6bn.
Reeves will make her spring statement to the Commons on Wednesday against a backdrop of sluggish economic growth, stubbornly high inflation and rising government borrowing costs.
Updated forecasts from the Office for Budget Responsibility due alongside the statement are expected to show her self-imposed fiscal rules would be broken without action.
Darren Jones, the chief secretary to the Treasury, said the government needed to go “further and faster to create an agile and productive state that works for people”.
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He said: “At the core of this urgent mission is sound public finances, based on our non-negotiable fiscal rules. This government will never play fast and loose with the public finances.”