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The Office for National Statistics published data indicating that the United Kingdom recorded public sector net borrowing of £1.8 billion in July 2026. This outcome came despite expectations of a balanced position or surplus in a month when self-assessment tax payments typically boost revenues. The borrowing total was £700 million higher than in July 2025 and surpassed the Office for Budget Responsibility forecast by £2.3 billion.
According to the Office for National Statistics, borrowing for the financial year to July reached £56.7 billion. Although this represented a decline of £6 billion from the prior year, it remained £2.3 billion above the independent forecast. The current budget registered a surplus of £3.1 billion for the single month, contributing to a cumulative surplus of £37.5 billion over the four-month period.
Public sector debt stood at £2.98 trillion at the end of July, equivalent to 94 percent of gross domestic product, the national statistics body reported. This reflected a year-on-year increase of £96 billion. The statistics arrive as Chancellor of the Exchequer John Healey readies his inaugural budget set for October 28.
John Healey said fiscal discipline is the bedrock of UK economic stability and national security. The chancellor added that the government is committed to meeting its fiscal rules with a buffer against global uncertainties. Healey further noted that the administration is cutting the deficit faster than any other G7 economy and will announce his first budget as the chancellor on 28 October.
Grant Fitzner, chief economist at the Office for National Statistics, stated that borrowing was slightly higher this month than in July last year. He pointed to spending growth outpacing higher receipts, including from self-assessed taxes which often feed in more strongly in July. Fitzner observed that another £2 billion was spent on social benefits compared with a year ago while debt interest payments rose by £700 million to £7.7 billion.
The Office for Budget Responsibility had anticipated a £500 million surplus for the month, according to accompanying analysis. Economists polled ahead of the release had largely projected zero borrowing. The Office for National Statistics data places total UK debt just short of the £3 trillion mark at £2.985 trillion, or 94.1 percent of gross domestic product.
