UK borrowing surges over forecasts in May as government spending rises – business live

Introduction: UK borrowing surges over forecasts in May Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy. The health of the British economy is centre stage today, as Andy Burnham wins the Makerfield by-election and declared that the Labour party has a “final chance to change”. But the latest public finances, just released, show the challenges facing whoever is in Downing Street. Britain borrowed £23.3bn in May to cover the diference between governmnent income and spending – a surge of £5.4bn more than a year ago. That’s the highest borrowing for any May since 2020, when the Covid-19 lockdown was in force. Worryingly, it’s also also £5.6bn more than the £17.7bn forecast by the Office for Budget Responsibility (OBR), the UK’s fiscal watchdog. This means government borrowing for this financial year (since April) is running £7.7bn over the OBR’s forecasts – at £46.3bn. That raises the risk that borrowing could be higher than forecast by the next budget, risking breaking Rachel Reeves’s fiscal rules – unless, of course, there is a leadership battle, and a new chancellor by the autum… The bigger picture is that this pushes the UK’s national debt up to 95.1% of GDP, levels last seen in the early 1960s Photograph: ONS ONS senior statistician To m Davies says : double quotation mark “Borrowing in the first two months of the financial year was nearly £9 billion higher than the same period of 2025. …