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The UK government borrowed less than expected in December, official figures show, after stronger receipts than a year earlier.<\/p>\n
Public sector net borrowing \u2013 the difference between spending and income \u2013 was \u00a311.6bn last month, the Office for National Statistics<\/a> said, compared with \u00a318.7bn in the same month a year earlier.<\/p>\n Economists polled by Reuters had expected borrowing to be \u00a313bn in December. The figure is closely watched by the City as it shows how much the government is borrowing to finance its spending plans and whether it is exceeding its target for the year.<\/p>\n Borrowing in the financial year so far to December was \u00a3140.4bn, down \u00a3300m compared with the same period last year. Borrowing in the previous months of the year was also revised down by a combined \u00a33.5bn.<\/p>\n Tom Davies, a senior statistician at the ONS, said: \u201cBorrowing in December was substantially down on the same month in 2024, as a result of receipts being up strongly on last year whereas spending is only modestly higher.\u201d<\/p>\n The chancellor, Rachel Reeves<\/a>, has made reducing government borrowing a priority, especially because the charge on its debt is currently so high, with \u00a31 in every \u00a310 spent going on debt interest.<\/p>\n The ONS figures show that interest costs accounted for \u00a39.1bn of the \u00a311.6bn of net government borrowing in December.<\/p>\n Dennis Tatarkov, a senior economist at KPMG UK, said this iwas likely to ease in the coming months. \u201c<\/strong>With interest rate cuts expected later this year and the eventual ending of the Bank of England\u2019s quantitative tightening programme on the horizon, the Treasury could see a marked decline in borrowing costs, potentially creating more room for public spending,\u201d he said.<\/p>\n