Public sector finances, UK: October 2024

• Borrowing – the difference between public sector spending and income – was £17.4 billion in October 2024, £1.6 billion more than in October 2023 and the second highest October borrowing since monthly records began in January 1993.

• Current budget deficit – borrowing to fund day-to-day public sector activities – was £12.7 billion in October 2024, £0.4 billion more than in October 2023 and the second highest October deficit since monthly records began in April 1997.

• Central government debt interest payable was £9.1 billion in October 2024, £0.5 billion more than in October 2023 and the highest October figure since monthly records began in January 1997.

• Borrowing in the financial year to October 2024 was £96.6 billion, £1.1 billion more than at the same point in the last financial year and the third highest financial year-to-October borrowing since monthly records began in January 1993.

• Public sector net debt excluding public sector banks was provisionally estimated at 97.5% of gross domestic product (GDP) at the end of October 2024; this was 1.6 percentage points more than at the end of October 2023, and remains at levels last seen in the early 1960s.

• Public sector net financial liabilities excluding public sector banks was provisionally estimated at 83.7% of GDP at the end of October 2024; this was 2.5 percentage points more than at the end of October 2023, but 13.8 percentage points lower than public sector net debt.

• Central government net cash requirement (excluding UK Asset Resolution Ltd and Network Rail) was £19.7 billion in October 2024, £1.6 billion more than in October 2023.

The public sector spent more than it received in taxes and other income in October 2024. It was required to borrow £17.4 billion, which is the highest October borrowing since 2020, when it was £18.2 billion. This is the second highest October borrowing since monthly records began in January 1993.

Initial estimates for October 2024 suggest that borrowing was £1.6 billion higher than October last year.

Public sector borrowing consists of two broad components: the current budget deficit (or borrowing to fund day-to-day activities) and net investment (capital expenditure).

The public sector current budget deficit was £12.7 billion in October 2024, £0.4 billion more than in the October 2023. This means that the public sector spent more on day-to-day activities than it received in taxes and other current receipts.

Net investment increased by £1.1 billion to £4.7 billion over the same 12-month period.

A breakdown of net borrowing by subsector and a summary of central government receipts and expenditure data are presented in Tables 1 to 3 in our Public sector finances summary tables: Appendix M dataset.

Central government borrowing

Central government forms the largest part of the public sector and includes HM Revenue and Customs, the Department of Health and Social Care, the Department for Education, and the Ministry of Defence.

The relationship between central government’s receipts and expenditure is an important determinant of public sector borrowing. Central government borrowed £23.6 billion in October 2024, £0.4 billion more than in October 2023. Some of this borrowing was offset by surpluses in other subsectors, with public sector borrowing totalling £17.4 billion in October 2024.

Central government current receipts

Central government’s receipts were £81.2 billion in October 2024, £2.9 billion more than in October 2023. Of this £2.9 billion increase in revenue:

• central government tax receipts increased by £3.8 billion to £61.3 billion; this included increases in Corporation Tax and Income Tax of £1.5 billion and £1.4 billion, respectively, and negligible growth in Value Added Tax (VAT) receipts

• compulsory social contributions decreased by £1.1 billion to £13.8 billion, largely because of the reductions in the main rates of National Insurance in early 2024

A detailed breakdown of central government income is presented in our Public sector current receipts: Appendix D dataset.

Central government current expenditure

Central government spending data for October 2024 are provisional. There is uncertainty around these estimates until more detailed departmental information becomes available later in the year.

Central government’s total expenditure was £88.5 billion in October 2024, £3.9 billion more than in October 2023. Of this overall £3.9 billion increase in spending:

• central government departmental spending on goods and services increased by £2.5 billion to £36.9 billion, as pay rises and inflation increased running costs

• payments to support the day-to-day running of local government increased by £0.9 billion to £12.3 billion; these intra-government transfers are both central government spending and a local government receipt, so they have no effect on overall public sector borrowing

• net social benefits paid by central government increased by £0.5 billion to £25.3 billion; this is because increases caused by inflation-linked benefits uprating were partially offset (reduced) by the one-off cost-of-living payments made last year but not repeated in October 2024

• interest payable on central government debt increased by £0.5 billion to £9.1 billion, largely because the interest payable on index-linked gilts rises and falls with the Retail Prices Index (RPI)

• current grants abroad decreased by £0.4 billion to £0.8 billion, largely because of the timing of payments made to the EU

Central government net investment

Central government net investment decreased by £0.9 billion to £12.8 billion. This was largely because of regular payments from HM Treasury to the Bank of England (BoE) Asset Purchase Facility (APF) Fund, which decreased by £1.6 billion, compared with a year earlier.

These intra-public sector transfers have no impact on overall public sector borrowing because they are both central government spending and a Bank of England receipt. However, they do affect our public sector net borrowing excluding the Bank of England (PSNB ex BoE) measure.

Interest payable on central government debt

In October 2024, the interest payable on central government debt was £9.1 billion, an increase of £0.5 billion compared with October 2023 and the highest October figure since monthly records began in January 1997.

The large monthly changes in the Retail Price Index (RPI) since early 2021 have led to considerable volatility in debt interest payable, with the largest three months on record occurring in 2022 and 2023. The additional interest caused by RPI inflation is described as “capital uplift” and affects the value of the gilt principal.

Capital uplift was £3.8 billion in October 2024, largely reflecting the 0.6% increase in the RPI between July and August 2024. This increased the capital uplift on the three-month lagged index-linked gilts (as shown on the UK Debt Management Office website), which make up around 95% of the index-linked gilt stock.

A monthly time series of capital uplift on the index-linked gilts in issue is available as series identifier code JNYY. This series is illustrated as the blue portion of each bar in Figure 2 and excludes the uplift payable at the time of an index-linked gilt redemption. These redemption payments are already recorded as accrued interest payable across the life of each index gilt.

For further details of our approach, see our Calculation of interest payable on government gilts methodology.

Our provisional estimate for the total borrowed in the financial year to October 2024 is £96.6 billion. This includes the £17.4 billion borrowed in October 2024, combined with a downward revision of £0.3 billion to our previously published financial year-to-September 2024 borrowing estimate.

This was £1.1 billion more than was borrowed in the same seven months last year. It is the third highest financial year-to-October borrowing since monthly records began in January 1993, behind those of the coronavirus (COVID-19) pandemic period.

Within public sector borrowing in the financial year to October 2024, the current budget deficit was £64.1 billion, £4.5 billion less than in the same period a year ago. Net investment increased by £5.5 billion to £32.6 billion over the same seven-month period.

A breakdown of net borrowing by subsector, and a summary of central government receipts and expenditure data are presented in Tables 1 to 3 in our Public sector finances summary tables: Appendix M dataset.

Central government borrowed £121.5 billion of the £96.6 billion borrowed by the public sector (excluding public sector banks) in the financial year to October 2024. This larger central government borrowing was partially offset by a £17.9 billion Bank of England (BoE) surplus and balanced by remaining subsectors.

The borrowing of both subsectors is affected by payments totalling £31.1 billion made by central government to the BoE in this period, under its Asset Purchase Facility (APF) Fund indemnity agreement.

As with similar intra-public sector transactions, these payments are public sector borrowing neutral. They increased central government’s borrowing by £31.1 billion in the financial year to October 2024, but reduced the borrowing impact of the BoE by an equal and offsetting amount.

Central government current receipts

Central government’s receipts were £570.0 billion in the financial year to October 2024, £18.8 billion (3.4%) more than in the same period last year. Of this £18.8 billion increase in revenue:

• central government tax receipts increased by £22.2 billion to £432.2 billion, with increases in Income Tax, Corporation Tax and Value Added Tax (VAT) receipts of £11.2 billion, £5.2 billion, and £3.2 billion, respectively

• compulsory social contributions decreased by £6.4 billion to £95.7 billion, largely because of the reductions in the main rates of National Insurance in early 2024

A detailed breakdown of central government income is presented in our Public sector current receipts: Appendix D dataset.

Central government current expenditure

Central government’s total expenditure was provisionally estimated as £691.5 billion in the financial year to October 2024, £20.0 billion (3.0%) more than in October 2023. Of this overall £20.0 billion increase in spending:

• central government departmental spending on goods and services increased by £11.9 billion to £245.7 billion, as pay rises and inflation increased running costs

• net social benefits paid by central government increased by £7.2 billion to £178.4 billion, largely because of inflation-linked benefits uprating

• payments to support the day-to-day running of local government increased by £6.9 billion to £87.8 billion; these intra-government transfers have no impact on overall public sector borrowing because they are both central government spending and a local government receipt

• current grants abroad decreased £4.4 billion to £3.3 billion, largely because of the timing of payments made to the EU

• subsidies paid by central government decreased by £3.3 billion to £16.2 billion, largely because of the closure of the energy support schemes that were active until June 2023

• interest payable on central government debt decreased by £2.2 billion to £53.6 billion, largely because the interest payable on index-linked gilts rises and falls with the Retail Prices Index (RPI)

Central government net investment

Central government net investment increased by £1.8 billion to £69.6 billion in the financial year to October 2024. This includes the regular payments from HM Treasury to the Bank of England APF Fund, which decreased by £2.1 billion compared with a year earlier. These intra-public sector transfers have no impact on overall public sector borrowing (PSNB ex).

Local government

Initial estimates suggest that local government was in surplus by around £3.9 billion in the seven months to October 2024. This is a £1.2 billion larger surplus than in the same period a year earlier. Our provisional monthly estimates for the UK are currently based on published budget data for England, Scotland, and Wales, with estimates included for Northern Ireland.

The public sector borrowed £125.1 billion in the financial year ending (FYE) March 2024. This was £1.6 billion more than the £123.5 billion borrowed in FYE March 2023, and £3.2 billion more than the £121.9 billion forecast by the Office for Budget Responsibility (OBR).

Expressing borrowing as a ratio of gross domestic product (GDP) – the value of everything produced in the UK economy in a 12-month period – gives an estimate of its affordability and provides a more thorough and reliable measure for comparison of the UK’s fiscal position over time.

Our current estimate for the total borrowed in the financial year ending (FYE) March 2024 as a ratio of GDP is 4.5%. This is 0.1 percentage points higher than our initial estimate published in our March 2024 release.

Our article, The use of GDP in public sector fiscal ratio statistics, describes the methodology used for the presentation of our GDP ratios.

The public sector balance sheet describes its financial position at a point in time. It shows its liabilities (amounts owed) and its assets (amounts owned).

There are several measures of the public sector balance sheet that we discuss in our What the UK government owns and what it owes blog.

Table 3 presents the narrowest balance sheet measure, which is the redemption value of central government gilts. It then builds on this measure, widening coverage by both the subsector and the range of asset and liability types included, to reach the far wider measure of public sector net worth. We explain this measure in our Wider measures of the public sector balance sheet: public sector net worth methodology.

Our Public sector balance sheet tables: Appendix N dataset presents a detailed reconciliation between the balance sheet measures summarised in Table 3.

Public sector net debt

The most widely used balance sheet measure used to describe the UK public sector’s financial position at a point in time is public sector net debt excluding public sector banks (PSND ex). Expressing net debt as a ratio of gross domestic product (GDP) gives an estimate of its affordability and provides a more thorough and reliable measure for comparison of the UK’s fiscal position over time.

The net debt-to-GDP ratio at the end of October 2024 was provisionally estimated at 97.5%, 1.6 percentage points higher than a year ago. However, this is a highly provisional estimate and is likely to be revised in future publications, because it partly relies on GDP estimates based on the October 2024 Office for Budget Responsibility forecast. Our blog explains why our estimates of the Debt to GDP ratio are susceptible to revision.

Public sector net debt excluding the Bank of England (BoE) was £2,581.3 billion at the end of October 2024, or around 90.2% of GDP. This is £210.2 billion (or 7.3 percentage points of GDP) less than the wider measure (including the BoE). This difference is largely a result of the BoE’s quantitative easing activities, including the gilt-purchasing activities of the Asset Purchase Facility (APF) Fund.

The APF’s gilt holding is not recorded directly as a component of public sector net debt. Instead, in October 2024, we recorded the £95.1 billion difference between the £654.5 billion of reserves created to purchase its gilts (at market value at the time of purchase) and their £559.4 billion redemption value.

For details of the BoE’s contribution to public sector net debt, see Table PSA9A of our Public sector finances tables 1 to 10: Appendix A dataset.

Public sector net financial liabilities

Public sector net financial liabilities excluding public sector banks (PSNFL ex) was £2,394.3 billion at the end of October 2024, which is equivalent to 83.7% of GDP. This was £157.0 billion (2.5 percentage points) more than at the end of October 2023.

PSNFL ex adds further assets and liabilities to debt (PSND ex). These extra assets currently are valued at more than the extra liabilities. This means that PSNFL ex is currently 13.8 percentage points of GDP less than PSND ex, which stood at 97.5% of GDP at the end of October 2024.

On 30 October 2024, we published an explanation of the financial assets and liabilities captured in PSNFL ex in our PSNFL methodology. Additionally, we published a blog explaining the PSNFL measure, because it has been selected by the UK government as the reference for a balance sheet fiscal rule.

Our Public sector balance sheet tables: Appendix N presents a reconciliation between PSND ex and PSNFL ex, in the context of the other balance sheet measures summarised in Table 3.

The additional assets and liabilities that fall outside of the PSND ex boundary, but are included in these wider balance sheet measures, are not updated monthly. Instead, they are updated quarterly, or when data becomes available.

A more detailed presentation of the public sector balance sheet is available in our Public sector net worth: Appendix O dataset, released on 20 September 2024.

The data for the latest months of every release contain a degree of forecasts. These are then replaced by improved estimates, as further data are made available, and finally by outturn data.

Tables 4 to 6 of our Public sector finances summary tables: Appendix M dataset compare our latest public sector finances data with those in our Public sector finances, UK: September 2024 bulletin, published on 22 October 2024. They highlight the revisions to borrowing by subsector, with additional detail for central government receipts and expenditure.

Our Public sector finance revisions analysis: Appendix P dataset records monthly borrowing data as at first and at subsequent publications, graphically illustrating any potential bias to our early estimates.

Revisions to public sector net borrowing

Since publishing our September 2024 release, we have reduced our estimate of public sector net borrowing (PSNB ex) in the first six months of the financial year by £0.3 billion to £79.3 billion. This change was because of regular updates to our central government data.

This month, we have included an adjustment to accrued corporation tax in line with the OBR’s new Autumn Budget 2024 forecast, alongside the inclusion of October 2024 receipts outturn data. These combined effects have resulted in downward adjustment to accrued corporation tax estimates of £2.5 billion in the financial year to September 2024.

These updates have resulted in reductions in our previous estimates of accrued corporation tax of £3.1 billion in the financial year ending March 2024, and £0.2 billion in the financial year ending March 2023.

We have reduced our previous estimate of central government spending over the latest six months by £1.7 billion. This is largely because of a £1.1 billion reduction to our previous estimate of net social benefits and a £0.7 billion reduction to our previous estimate of departmental spending of goods and services.

Over the same period, we increased our previous estimate of current grants to local government by £0.5 billion. In doing so, we reduced our previous estimate of local government borrowing by an equal and offsetting amount.

Revisions to public sector net debt (PSND ex) at the end of September 2024

Since publishing our September 2024 release, our estimate of debt at the end of September 2024 increased by £0.8 billion to £2,767.2 billion.

This change was largely because of routine monthly updates to our estimates of the cash holding of the Bank of England (BoE) Asset Purchase Facility Fund, which we reduced by £0.7 billion. These data are reported one month in arrears.

Revisions to public sector banks’ contribution to debt

Estimates of the net debt of public sector banks are derived from the balance sheet of these organisations, supplied to us by the BoE twice annually.

We have received the balance sheet covering the period January to May 2024 for the first time this month, which allows us to update previous estimates.

Because of these updates, we have reduced our estimate of public sector net debt including public sector banks at the end of May 2024 by £1.8 billion to £3,098.9 billion.

Revisions to gross domestic product

Since publishing our September 2024 release, we have reduced our estimate of debt as a ratio of gross domestic product (GDP) at the end of September 2024 by 1.4 percentage points, from 98.5% to 97.1%.

This reduction was a result of two regular data updates:

• our estimates of monthly nominal GDP have been updated to include the latest OBR forecasts, published in its outlook for the economy and public sector finances on 30 October 2024

• our previous OBR-based estimate of nominal GDP for the Quarter 3 (July to Sept) of 2024 has been replaced by our GDP first quarterly estimate, UK: July to September 2024, published on 15 November 2024

Our blog explains why our estimates of the debt to GDP ratio are susceptible to revision.

Public sector

In the UK, the public sector consists of six subsectors: central government, local government, public non-financial corporations, public sector funded pensions, the Bank of England (BoE), and public financial corporations (including public sector banks). The figures presented in this release exclude public sector banks unless otherwise noted.

The NatWest Group, the only remaining public sector bank, was reclassified to the private sector as of June 2024.

Public sector current budget deficit

Public sector current budget deficit (PSCBD) is the gap between current expenditure and current receipts on an accruals basis, having taken account of depreciation. PSCBD is effectively an estimate of borrowing to fund day-to-day public sector activities and is the reference statistic used for a UK government fiscal rule.

The current budget is in surplus when receipts are greater than expenditure and is indicated with a negative sign.

Public sector net borrowing

Public sector net borrowing (PSNB) is the gap between total expenditure and current receipts on an accruals basis. If receipts exceed expenditure, this is referred to as a surplus and is indicated with a negative sign. Borrowing is often referred to by commentators as “the deficit”.

Public sector current budget deficit and net borrowing are measured on an accruals basis, where transactions for revenue are recorded when earned and expenses are recorded when incurred, rather than when the bills are paid (on a cash basis).

Central government net cash requirement

The central government net cash requirement (CGNCR) represents the cash needed to be raised from the financial markets over a period to finance its activities. The amount of cash required will be affected by changes in the timing of payments to and from the public sector, rather than when these liabilities were incurred.

Public sector net debt

Public sector net debt (PSND), often referred to by commentators as “the national debt”, represents the amount of money the public sector owes to the private sector and overseas (in the form of loans, debt securities, deposit holdings and currency), net of liquid financial assets held.

Public sector net financial liabilities

Public sector net financial liabilities (PSNFL) is a wider measure of the balance sheet than public sector net debt and includes all financial assets and liabilities recognised in the national accounts. PSNFL is the reference statistic used for a UK government fiscal rule and is sometimes referred to as “net financial debt”.

Broadening the PSNFL measure to include the public sector’s non-financial assets provides public sector net worth (PSNW), our widest balance sheet measure.

Methodology guides

To supplement this release, we publish an accompanying methodological guide and quality and methodology information report outlining the strengths, limitations, and appropriate uses of government finance statistics.

We also explain the recording of interest payable to holders of UK government gilts in the UK public sector finances in our Calculation of interest payable on government gilts methodology and our Use of gross domestic product (GDP) in public sector fiscal ratio statistics methodology.

Accredited official statistics

Public sector net borrowing, cash requirement and debt are accredited official statistics. These accredited official statistics were independently reviewed by the Office for Statistics Regulation in June 2017. They comply with the standards of trustworthiness, quality, and value in the Code of Practice for Statistics and should be labelled “accredited official statistics”.

Official statistics

Public sector net financial liabilities and public sector net financial worth are both official statistics. These measures were introduced after June 2017, and so have not yet been reviewed by the Office for Statistics Regulation.

Official statistics in development

Public sector net worth is labelled as “official statistics in development”. Until October 2023, these were called “experimental statistics”. Read more about the change in our guide to official statistics in development.

Tax receipts

In the most recent months, tax receipts recorded on an accrued basis are subject to some uncertainty. This is because many taxes such as Value Added Tax (VAT), Corporation Tax, and Pay As You Earn Income Tax contain some forecast cash receipts data and are liable to revision when actual cash receipts data are received.

The forecasts underlying our current tax estimates reflect the expectations published in the Office for Budget Responsibility’s (OBR’s) Economic and fiscal outlook – March 2024 report. However, this month we referenced the updated forecasts published in OBR’s Economic and fiscal outlook – October 2024 report in our latest corporation tax data.

Bank of England

In October 2021, our Recent and upcoming changes to public sector finance statistics: September 2021 article explained improvements to our estimates of the Bank of England’s (BoE’s) contribution to our public sector measures.

In December 2024, we aim to include additional monthly data from the BoE, which will replace further instances where published annual data are used. These more frequent data will be used to provide more precise monthly estimates of the contribution of the BoE to the public sector finance aggregates.

Local government and public corporations

Local government data for the financial year ending (FYE) March 2025 are provisional estimates for the UK. They are largely based on published budget data for England, Scotland, and Wales, and with estimates included for Northern Ireland.

In recent years, planned local government expenditure initially reported in local authority budgets has been systematically lower than final outturn current expenditure reported in the audited accounts, and generally higher than that reported in final outturn capital expenditure. Therefore, we include adjustments to increase or decrease the amounts reported at the budget stage.

For FYE March 2024, we include:

• a £3.0 billion upward adjustment to England’s current expenditure on goods and services
• a £0.5 billion downward adjustment to Wales’s capital expenditure
• a £0.5 billion downward adjustment to Scotland’s capital expenditure

To reflect the most recently available data for housing benefits, we have applied further downward adjustments to budget data for current expenditure on benefits of £0.7 billion in FYE 2024 and £1.7 billion in FYE 2025.

Data for public corporations in FYE 2024 are largely based on the OBR’s Economic and fiscal outlook – March 2024 report, supplemented by in-year estimates for train operating companies, the Housing Revenue Account, and surveyed public corporations.

Comparing our data with official forecasts

The independent OBR is responsible for the production of official forecasts for the UK government. These forecasts are usually produced twice a year, in spring and autumn. The latest forecast was published in the OBR’s Economic and fiscal outlook – October 2024 report.