Government borrowing soars to more than £18bn in August

(Sharecast News) - The UK government borrowed more than expected last month, official data showed on Tuesday, as spending outstripped a rise in tax receipts. According to the Office for National Statistics, public sector net borrowing was £18.3bn in August, up £2.9bn on the same month last year and higher than the £15.7bn markets had pencilled in. It also exceeded the Office for Budget Responsibility's forecast by £3.5bn.

Self-assessed income tax receipts in July and August rose by £1.9bn to £18.6bn. That was slightly above the OBR's forecast. However, spending was also above target, in part due to rising inflation. Debt interest payments totalled £8.8bn, the highest August figure since monthly records began in 1997.

Tom Davies, senior statistician at the ONS, said: "On the month, borrowing was up by almost a fifth on last August, as spending increased by more than government income, partly reflecting the impacts of inflation."

In the financial year to date, borrowing was notably lower than the same period last year, down 2.7% at £77.3bn. However, the OBR had expected a bigger fall.