UK public sector net borrowing (excluding public sector banks) widened to £23.3 billion in May 2026, up from £17.9 billion in May 2025 and above market expectations of £18.5 billion. This was the second-highest borrowing level for any May on record, exceeded only by May 2020.
Public sector expenditure rose by £9.1 billion to £118.0 billion, driven by higher debt interest payments, increased public service delivery costs, greater investment, and higher benefit spending. Central government debt interest costs were the highest ever recorded for the month of May.
Public sector receipts increased by £3.7 billion to £94.8 billion, supported in particular by stronger tax revenues. However, growth in National Insurance contributions slowed relative to recent trends, as the year-on-year uplift from the April 2025 policy changes has now dropped out of the comparison.
Public sector net debt, excluding public sector banks, was equivalent to 95.1% of GDP at the end of May, 0.4 percentage points higher than a year earlier.
