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The health of Britain’s public finances is being closely watched in both Westminster and the City of London, just days before chancellor Rachel Reeves is due to deliver her spring statement on 26 March.

And the latest public finances data, just released by the Office for National Statistics, shows that the UK borrowed more than economists expected last month to balance the books.

Public borrowing hit £10.7bn in February, higher than the £6.6bn forecasted by City economists.

It illustrates the scale of the challenge facing Reeves, who is due to announce cuts to spending, alongside fresh economic and public finance forecasts from the Office for Budget Responsibility, next week.

The ONS said that overall, government borrowing hit £132.2bn in the financial year to February, which is £14.7bn more than the same period a year earlier

Alex Kerr, UK economist at Capital Economics, said:

Although they will have no impact on the fiscal update next week, the significant overshoot in borrowing in February highlights the Chancellor’s tight fiscal backdrop. The OBR will still most likely conclude that the chancellor’s headroom against her fiscal rules has been wiped out.

So we expect her to announce further non-defence spending cuts, on top of the welfare cuts already unveiled earlier this week.

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