Government borrowing hit £20 billion in September as debt interest surged due to inflation. The Office for National Statistics (ONS) said the reading for borrowing, excluding state-owned banks, marked the second-highest September on record, only surpassed during the height of the Covid-19 pandemic.
Borrowing in September outpaced the predictions of economists, who had forecast £17 billion for the month, and was significantly above the £14.8 billion estimated by the Office for Budget Responsibility back in March. The latest data revealed that increased borrowing was driven by £7.7 billion of debt interest payments for the month, reflecting an increase of £2.5 billion compared with the same month in 2021.
It was the highest September interest figure since records began in 1997. Significantly higher debt interest payments linked to Retail Prices Index inflation drove the increase, the ONS said.
Government spending increased by £5.8 billion to £79.3 billion for September, as a result of the jump in interest.
