Fact Service January 2023

Government borrowing hits 30 year high

Public sector borrowing reached £27.4 billion in December, the highest figure for that month since monthly records began in January 1993, the Office for National Statistics has revealed. The ONS pointed to a sharp rise in spending on energy support schemes and an increase in debt interest as contributors to the record high, which was £16.7 billion greater than December 2021’s figure, and £9.8 billion higher than the latest official forecast published by the Office for Budget Responsibility (OBR).

Central government debt interest payable was £17.3 billion, also the highest December figure since monthly records began.

Public sector debt was £2.5 trillion, equivalent to around 99.5% of the UK’s gross domestic product.

“Glimmers of good economic news have yet to show themselves in the public finances, with borrowing significantly higher than expected in December,” Felicia Odamtten, economist at the Resolution Foundation think tank, commented.

“Rising energy support and debt interest costs continue to drive up borrowing this year, though energy support is set to be far less costly next year,” she concluded.