Reeves' Borrowing Blowout: £18bn in August, 44% Above Forecast
Debt now £2.91 trillion — equal to £52,000 per adult, with interest costs at historic highs.
📉 Borrowing Blowout in August
The UK Government borrowed £18.0 billion in August 2025. To put that in perspective:
It’s the second-highest August deficit on record, only surpassed during the extraordinary Covid-era borrowing of 2020.
Compared with last year, borrowing rose by £3.5 billion.
Crucially, the Office for Budget Responsibility (OBR) had forecast just £12.5 billion for August. That means actual borrowing was £5.5 billion higher, 44% above forecast.
These aren’t just small misses. They show a government that cannot get control of the public finances, and an economy delivering weaker receipts while costs spiral.
👉 After stripping out the Covid spike, 2024 and 2025 now stand as the two highest August borrowing figures in modern records (since monthly data began in 1993).
📊 Total Debt Nears £3 Trillion
The UK’s public sector net debt (excluding public sector banks) is now:
£2,909,418,000,000
That’s almost £2.91 TRILLION.
For context:
In 2007, on the eve of the financial crisis, debt was just £0.6 trillion (36% of GDP).
Today it’s 96.4% of GDP — levels not seen since the early 1960s.
That means nearly every pound of output in the economy has a pound of debt attached to it.
Debt isn’t just an abstract number. The larger it grows, the more taxpayers are forced to spend on interest rather than services.
💷 £52,000 Per Adult
Strip out children under 18, and Britain has 55.9 million adults. Against a debt pile of £2.91 trillion, that’s ≈ £52,000 per adult (18+).
That’s like handing every adult in the UK a second mortgage. Only this one isn’t paying for a house, or even for a long-term investment. It’s paying for day-to-day spending that we can’t afford.
This figure also masks the reality that taxpayers, not just adults, ultimately shoulder the cost. For a typical household, it’s tens of thousands of pounds in hidden liabilities.
📈 Why the Deficit is Growing
ONS data shows borrowing is climbing because spending is rising faster than receipts.
Spending up £7.8bn year-on-year:
Goods & services +£3.7bn — pay rises for public sector staff, and inflation making everything more expensive.
Debt interest +£1.9bn — driven by index-linked gilts, which alone added £2.6bn this month due to movements in RPI.
Social benefits +£1.1bn — uprated pensions and inflation-linked benefits driving higher welfare spending.
Receipts up, but not enough (+£4.3bn YoY):
Income Tax +£1.0bn
NICs +£2.6bn — largely thanks to April’s increase in employer National Insurance contributions.
VAT and Corporation Tax rose slightly.
The imbalance is stark: even with higher taxes and NI contributions, the government cannot keep up with its rising bills.
⚠️ Off Track Already
We are not even halfway through the financial year, but the numbers show the UK is already badly off course:
April–August 2025 borrowing: £83.8 billion.
That’s £16.2 billion more than last year, and
£11.4 billion higher than the OBR’s March forecast.
The government is spending faster than planned, with no credible route back to balance. Every missed target today means even harsher decisions tomorrow.
📈 Borrowing Costs at Historic Highs
Under Rachel Reeves, the cost of government borrowing has climbed to historic highs.
Ten-year gilt yields are now around 4.7% — compared with less than 1% in 2021.
Every pound of debt maturing has to be refinanced at rates five times higher than just a few years ago.
The result is billions more of taxpayers’ money swallowed by interest payments instead of frontline services.
This squeeze isn’t temporary. With debt levels nearing £3 trillion, even small increases in gilt yields result in huge extra costs.
🏦 A Debt Mountain That Drains Britain
The UK’s debt mountain doesn’t just sit quietly on the books — it demands payment every single month:
August interest bill: £8.4 billion.
Of this, £2.6 billion was simply an RPI “uplift” on index-linked gilts — meaning inflation is literally inflating the cost of our debt.
To put that in perspective:
The August interest bill alone could have paid the annual salary of around 236,000 NHS nurses (based on the ONS median of £35,584).
This is the trap: as debt rises, interest rises with it, swallowing more and more of the tax base. It’s money gone — with nothing to show for it.
🚨 The Bottom Line
Britain is piling on debt faster than forecast. Borrowing is surging, spending is outrunning income, and debt is now close to £3 trillion. That’s £52,000 for every adult in the UK — and climbing.
The longer this continues, the bigger the bill taxpayers will face — and the less room government will have to fund services, cut taxes, or invest in growth.
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Thank you, unfortunately I fear thing are only going to get worse!