Economic Buzz: UK budget deficit widens in May

UK public sector net borrowing increased in May despite an increase in government receipts, official data showed on Friday.

In May, borrowing increased GBP 0.7 billion from the last year to GBP 17.7 billion, the Office for National Statistics reported. This was more than the GBP 17.1 billion forecast by the Office for Budget Responsibility.

Further, this was the second highest borrowing in any May since records began in 1993.

Central government's current receipts increased GBP 5.3 billion to GBP 82.5 billion in May. Tax receipts rose by GBP 3.5 billion due to the increases in income tax and value added tax income and compulsory social contributions.

Changes to the rate of National Insurance contributions paid by employers lifted compulsory contributions in May.

Meanwhile, central government's current expenditure grew GBP 4.1 billion annually to GBP 89.2 billion in May.

Further, data showed that borrowing in the financial year to May was GBP 37.7 billion, which was GBP 1.6 billion more than in the same two-month period of 2024 and the third-highest April to May borrowing since monthly records began.

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