The UK government’s borrowing has surged to its highest level in five years, piling fresh pressure on Prime Minister Keir Starmer’s administration just weeks before its annual budget announcement.
According to data released Tuesday by the Office for National Statistics (ONS), public sector borrowing between April and September 2025 — the first half of the fiscal year — hit £99.8 billion ($133.6 billion). That’s the second-highest six-month figure since records began in 1993, surpassed only during the Covid-19 pandemic.
For September alone, the UK recorded a deficit of £20.2 billion, up £1.6 billion from the same month last year.
The sharp rise reflects ongoing pressure on the Labour government to fix public finances without stalling an economy already struggling with weak growth and persistent inflation.
Finance Minister Rachel Reeves is widely expected to announce tax increases in the upcoming November budget as part of efforts to stabilize the country’s debt levels. Reeves had already raised certain levies in her first budget last October, a move some analysts argue has slowed recovery.
Economists say a major driver of the growing deficit is the soaring cost of servicing debt, particularly inflation-linked government bonds that have become more expensive as prices continue to rise.
“No wonder the government isn’t winning any extra supporters: they are borrowing more to fund previous borrowing, which is a debt doom loop,”
said Kathleen Brooks, research director at XTB trading group.
