UK public sector borrowing reaches highest December level in four years

The UK public sector’s borrowing for December 2024 reached £17.8 billion, marking an increase of £10.1 billion compared to December 2023. This figure represents the highest December borrowing level recorded in the past four years, reflecting ongoing financial pressures on government finances.

The current budget deficit, which accounts for borrowing to cover day-to-day public sector operations, stood at £10.0 billion in December 2024. This represents a year-on-year increase of £7.3 billion and is the highest December deficit recorded in the past two years.

Interest payments on central government debt rose to £8.3 billion in December, driven largely by fluctuations in the Retail Prices Index (RPI). This marks an increase of £3.8 billion compared to the previous year and represents the third-highest December figure since monthly records began in January 1997.

For the financial year to December 2024, total public sector borrowing reached £129.9 billion, which is £8.9 billion higher than the same period in the previous fiscal year. This makes it the second-highest borrowing figure recorded for this period since monthly records began in January 1993.

The UK’s public sector net debt, excluding public sector banks, was provisionally estimated at 97.2% of gross domestic product (GDP) at the end of December 2024. This figure reflects a 0.3 percentage point increase compared to December 2023, keeping debt levels at figures last seen in the early 1960s.

Similarly, public sector net financial liabilities, excluding public sector banks, were estimated at 84.5% of GDP at the end of December 2024. This marks an increase of 1.9 percentage points from the previous year but remains 12.7 percentage points lower than public sector net debt.

The central government net cash requirement, which measures the difference between government receipts and expenditure excluding UK Asset Resolution Ltd and Network Rail, stood at £19.4 billion in December 2024, reflecting a £0.8 billion increase compared to December 2023.

The rising levels of public borrowing and debt highlight the ongoing financial challenges facing the UK government, as it navigates economic pressures and rising interest costs while seeking to manage public finances effectively.

Source: UK National Statistics Office