UK borrowing reaches £18.3bn in August and exceeds OBR forecast

The UK public sector borrowed £18.3 billion in August 2026, according to provisional figures from the Office for National Statistics.

That was £2.9 billion, or 19%, more than in August 2025 and £3.5 billion above the Office for Budget Responsibility's monthly forecast.

What has been verified

Borrowing in the financial year to August reached £77.3 billion. This was £2.2 billion less than in the same five months of last year, but £8.1 billion more than the OBR forecast for the period.

The current budget deficit was £12.4 billion in August and £51.9 billion over the financial year to date. This measure excludes net investment and shows the gap between current receipts and day-to-day spending.

Central government receipts were £89.8 billion in August, £3.3 billion more than a year earlier. Central government expenditure rose by £4.9 billion to £103.1 billion.

Debt interest remains an important pressure

Central government debt interest payable was £8.8 billion in August. The ONS said this was the highest August figure since monthly records began in 1997, without adjusting for inflation.

The total included a £2.1 billion uplift in the capital value of index-linked gilts. Payments on these securities move with the Retail Prices Index, so monthly debt-interest figures can be volatile.

Debt remains close to £3 trillion

Public-sector net debt was provisionally estimated at £2,985.5 billion at the end of August, £78.5 billion more than a year earlier.

Debt was estimated at 93.8% of gross domestic product. That ratio was 1.3 percentage points lower than in August 2025, reflecting revisions and changes in both debt and the size of the economy.

Why this matters to investors

Higher borrowing can increase the amount the government needs to raise through gilt issuance. It can also reduce fiscal headroom ahead of tax and spending decisions.

Neither consequence is mechanical. Gilt yields are also influenced by inflation, Bank of England policy, economic growth and global bond markets. One month's borrowing figure should therefore be treated as one part of a wider fiscal picture.

The next Budget is scheduled for 28 October, when the OBR is expected to publish an updated economic and fiscal forecast.

The Apolifina view

The August release sends a mixed signal. Borrowing over the financial year so far is slightly below last year's level, but it remains materially above the OBR's monthly profile.

Receipts continued to grow, but spending rose faster in August and debt-interest costs remained elevated. The important question for the Budget is whether the full-year outlook leaves the government enough room to meet its fiscal rules without significant policy changes.

Uncertainty

Public-finance estimates are provisional and are routinely revised as better information becomes available. The ONS also incorporates annual data updates in September, which can alter comparisons with earlier releases.

Monthly borrowing is volatile. A single month should not be used on its own to infer the eventual full-year total or the direction of gilt markets.

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