UK borrows more than expected in July as Healey prepares for first Budget
The UK government's borrowing in July exceeded official forecasts by £2.3bn, driven largely by increased welfare and pension spending. Chancellor John Healey faces a difficult fiscal environment as he prepares for the upcoming October Budget while maintaining strict fiscal discipline.
Why it matters
Higher-than-expected borrowing limits the government's ability to fund public services and cost-of-living support, potentially impacting future economic policy.
Image source, Getty Images By Faarea Masud Business reporter Published 8 minutes ago The government borrowed slightly more than expected in July, according to figures published as Chancellor John Healey draws up his first Budget.
The Office for National Statistics (ONS) said borrowing was £2.3bn more than official forecasts from the Office for Budget Responsibility (OBR).
Borrowing, the gap between what the government spends and what it takes in tax receipts, was £1.8bn in July, two thirds higher than the same month last year.
Economists warned the figure will restrict Healey and Prime Minister Andy Burnham's room for manoeuvre as they target measures aimed at easing the cost of living for households, with little room to increase borrowing in the Budget on 27 October.
Healey has made it clear he will oversee "strong fiscal discipline" at the Budget – which will limit how much the government has to spend.
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