Public sector borrowing hits record levels

PUBLIC sector net borrowing reached a record high in August, surprising analysts who had expected the figure to have dropped since last year.

The Office of National Statistics (ONS) said public sector net borrowing stood at £15.9bn in August, up from £14.1bn in the same month last year and the highest rate since records began in 1993. Economists had expected the figure to be around £12.5bn.

Public sector net borrowing now stands at £58.1bn for the financial year to date, but the figure is down slightly from £61.9bn for the same period last year.

The ONS said the rise in borrowing came as rising inflation meant interest payments rose to £3.8bn last month, from £1.3bn in August 2009.