The UK’s public sector net borrowing excluding public sector banks (PSNB ex) in October 2023 was £14.9 billion, £4.4 billion more than in October 2022 and the second highest October borrowing since monthly records began in 1993, according to the UK’s Office for National Statistics (ONS).
PSNB ex for April to October 2023 was £98.3 billion, £21.9 billion more than in the same seven-month period last year, but £16.9 billion less than the £115.2 billion forecast by the Office for Budget Responsibility (OBR) in March 2023.
Public sector net debt (PSND ex) was £2.643 trillion at the end of October 2023 and was provisionally estimated at around 97.8% of the UK’s annual gross domestic product (GDP) — this is 2.3 percentage points higher than in October 2022 and remains at levels last seen in the early 1960s.
In October 2023, the interest payable on UK central government debt was £7.5 billion, £1.1 billion more than in October 2022, and £2.6 billion more than the OBR’s March 2023 forecast of £4.9 billion. This was the highest interest payable in any October since monthly records began in April 1997.
In the seven months to October 2023, UK central government received £540.5 billion in taxes and other payments, an increase of £23.4 billion compared with the same period a year ago. However, this increase was exceeded by a £67.4 billion increase in total expenditure, rising to £663.9 billion over the same period.
“The principal determinants of the £98.3 billion borrowed by the public sector in the first seven months of the current financial year was the £123.4 billion borrowed by central government, which was partially offset by a £19.3 billion Bank of England (BoE) surplus,” said the ONS.
“The borrowing of both of these subsectors is affected by payments totalling £33.2 billion made by central government to the BoE over the last seven months under the Asset Purchase Facility Fund (APF) indemnity agreement. This was £32.4 billion more than the £0.8 billion paid in the same period last year.
“As with similar intra public sector transactions, these payments are public sector borrowing neutral. They increase central government’s borrowing by £32.4 billion compared with the same period last year, but reduce the borrowing impact of the BoE by an equal and offsetting amount.
“The receipt of these indemnity payments reduced the BoE’s contribution to net borrowing by £32.4 billion compared with a year earlier. However, this decrease was partially offset by a £16.0 billion increase in the net interest payable by the BoE, largely on the reserves created to finance the quantitative easing activities of the APF.”