Government borrowing reaches third-highest yearly level since records began amid increasing benefits bill
23 April 2025, 07:57
The government borrowed more than expected in the last financial year, official figures show.
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Public sector net borrowing rose to £151.9 billion in the year to the end of March, the Office for National Statistics (ONS) said.
This was £14.6 billion higher than the £137.3 billion forecast by the Office for Budget Responsibility.
The yearly figure was also £20.7 billion more than the same period a year earlier.
The ONS said it was the third-highest level of borrowing in any financial year since records began in 1947, behind the Covid pandemic in the year to 2021, and the 2010 financial year following the global crisis.
It comes as borrowing rose to £16.4 billion last month, the third-highest March borrowing since monthly records began, the new figures show.
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Grant Fitzner, the ONS's chief economist, said: "Our initial estimates suggest public sector borrowing rose almost £21 billion in the financial year just ended as, despite a substantial boost in income, expenditure rose by more.
He said this was "largely due to inflation-related costs, including higher pay and benefit increases."
Mr Fitzner added: "At the end of the financial year, debt remained close to the annual value of the output of the economy, at levels last seen in the early 1960s."
The UK economy shrank unexpectedly by 0.1% in January
Junior Treasury minister Darren Jones said: "Economic stability is crucial within a changing world.
"We will never play fast and loose with the public finances, that's why our fiscal rules are non-negotiable and why we are going through every penny of taxpayer money spent, line by line, for the first time in 17 years to tear out waste.
"We are laser-focused on making sure taxpayer money is delivering our Plan for Change missions to put more money in people's pockets, rebuild the NHS and strengthen our borders."
