Government borrowing exceeded forecasts in November, according to the latest official data, despite a slight decrease from the previous year. November's borrowing reached £14.3 billion,

surpassing the expected £13 billion, marking the fourth highest total for this month since records began in 1993. The rise in spending, mainly driven by benefit payments, countered the reduction in energy bill support. However, increased income tax and VAT receipts contributed to higher government income.

Year-to-date borrowing has totaled £116.4 billion, an increase of £24.4 billion from the same period last year. The Office for National Statistics (ONS) highlighted the cessation of energy price schemes initiated in October 2022, although these spending reductions were offset by other inflation-related expenses, notably increased benefit payments.

Despite lower-than-anticipated borrowing earlier this year, attributed partly to favorable tax revenues due to static income tax thresholds, experts anticipate a gradual decline in borrowing over the coming years. This outlook is hinged on income tax bands not adjusting in line with recent wage increases, a phenomenon known as fiscal drag.

Government borrowing surged in recent years due to substantial spending on pandemic relief and energy bill subsidies following last year's energy price surge. Chief Secretary to the Treasury, Laura Trott, emphasized the need to address this escalating debt burden while acknowledging the necessity of prior spending in response to the pandemic and energy market disruptions.

National debt, which stands at £2.67 trillion as of November 2023, equates to approximately 97.5% of the UK's GDP. This statistic raised scrutiny when Prime Minister Rishi Sunak claimed a reduction in debt, a statement challenged by the UK Statistics Authority due to its potential impact on public trust in government statistics.

Economists highlighted concerns over the government's fiscal policy, noting that despite stable debt levels, the government's goal of reducing debt might prove challenging. Projections suggest marginal decreases in debt over the next few years, contingent on ambitious and potentially unrealistic spending plans, prompting questions about the government's ability to achieve its fiscal targets. Photo: Sergeant Tom Robinson RLC/MOD, Wikimedia commons.