UK Government Posts Larger-Than-Expected Budget Deficit in November as Borrowing Pressures Persist
Public sector net borrowing in November overshot forecasts, reinforcing strains on Britain’s finances and underscoring fiscal challenges ahead
The United Kingdom’s public finances showed a wider-than-expected budget deficit in November, official data released on Friday revealed, highlighting ongoing pressure on government borrowing amid a mixed economic backdrop.
Public sector net borrowing — the difference between what the government spends and what it collects in revenue — amounted to £11.7 billion last month, above economists’ forecasts of around £10 billion.
While this represented the lowest November figure since 2021, it nonetheless surpassed market expectations and contributed to a larger-than-anticipated fiscal gap.
The Office for National Statistics also revised up borrowing figures for previous months, with October’s deficit now estimated at £21.2 billion, higher than earlier reported, and total borrowing for the first eight months of the 2025/26 financial year reaching £132.2 billion — roughly £10 billion more than the same period a year earlier.
These revisions reflect weaker-than-expected corporation tax receipts and additional winter fuel payment costs, which were only partly offset by lower local government spending.
Although the November deficit was smaller than in many previous months, the fact that it exceeded forecasts underscores persistent fiscal challenges for the government as it seeks to balance investment in public services with efforts to meet its long-term budgetary targets.
Public sector borrowing has surpassed economists’ expectations in most months of the current fiscal year, adding to concerns about the trajectory of the nation’s finances and the need for continued vigilance in managing revenue and expenditure.
The data arrive against a backdrop of subdued economic activity, with other indicators showing weak consumer spending and slowing growth, further complicating the fiscal outlook.
November retail sales unexpectedly contracted, reflecting subdued demand in the run-up to the holiday season, a trend that could weigh on future tax receipts.
Such developments are likely to feature in policymakers’ assessments as they navigate the interplay between supporting economic recovery and maintaining fiscal discipline.
Public sector net borrowing — the difference between what the government spends and what it collects in revenue — amounted to £11.7 billion last month, above economists’ forecasts of around £10 billion.
While this represented the lowest November figure since 2021, it nonetheless surpassed market expectations and contributed to a larger-than-anticipated fiscal gap.
The Office for National Statistics also revised up borrowing figures for previous months, with October’s deficit now estimated at £21.2 billion, higher than earlier reported, and total borrowing for the first eight months of the 2025/26 financial year reaching £132.2 billion — roughly £10 billion more than the same period a year earlier.
These revisions reflect weaker-than-expected corporation tax receipts and additional winter fuel payment costs, which were only partly offset by lower local government spending.
Although the November deficit was smaller than in many previous months, the fact that it exceeded forecasts underscores persistent fiscal challenges for the government as it seeks to balance investment in public services with efforts to meet its long-term budgetary targets.
Public sector borrowing has surpassed economists’ expectations in most months of the current fiscal year, adding to concerns about the trajectory of the nation’s finances and the need for continued vigilance in managing revenue and expenditure.
The data arrive against a backdrop of subdued economic activity, with other indicators showing weak consumer spending and slowing growth, further complicating the fiscal outlook.
November retail sales unexpectedly contracted, reflecting subdued demand in the run-up to the holiday season, a trend that could weigh on future tax receipts.
Such developments are likely to feature in policymakers’ assessments as they navigate the interplay between supporting economic recovery and maintaining fiscal discipline.
