Public sector finances, UK: October 2025

• Borrowing – the difference between total public sector spending and income – was £17.4 billion in October 2025; this was £1.8 billion (or 9.6%) less than October 2024 but the third-highest October borrowing (not adjusted for inflation) since monthly records began in 1993, after those of 2024 and 2020.

• Borrowing in the financial year to October 2025 was £116.8 billion; this was £9.0 billion (or 8.4%) more than in the same seven-month period of 2024 and the second-highest April to October borrowing (not adjusted for inflation) on record, after that of 2020.

• Borrowing in the financial year to October 2025 was provisionally estimated at 3.9% of gross domestic product (GDP); this was 0.1 percentage points more than in the same seven-month period of 2024.

• The current budget deficit – borrowing to fund day-to-day public sector activities – was £12.6 billion in October 2025; this brings the total current budget deficit in the financial year to October 2025 to £83.9 billion, which is £7.4 billion (or 9.7%) more than in the same seven-month period of 2024.

• Public sector net debt excluding public sector banks was provisionally estimated at 94.5% of GDP at the end of October 2025; this was 0.2 percentage points less than at the end of October 2024 and remains at levels last seen in the early 1960s.

• Public sector net financial liabilities excluding public sector banks were provisionally estimated at 84.0% of GDP at the end of October 2025; this was 2.5 percentage points more than at the end of October 2024, but 10.5 percentage points less than for public sector net debt.

• Central government net cash requirement (excluding UK Asset Resolution Ltd and Network Rail) was £21.7 billion in October 2025; this was £1.9 billion (or 9.8%) more than in October 2024.

Initial estimates show that the public sector spent more than it received in taxes and other income in October 2025, requiring it to borrow £17.4 billion.

This was £1.8 billion (or 9.6%) less than in October 2024 but £3.0 billion (or 21.4%) more than the £14.4 billion forecast in March 2025 by the Office for Budget Responsibility.

Public sector net borrowing is the sum of its current budget deficit and its net investment.

The current budget, which is usually in deficit, can be considered as borrowing to fund day-to-day public sector activities. This is the difference between its current receipts from taxes and other sources and its current expenditure on running public services, grants and administration.

The current budget deficit was £12.6 billion in October 2025; this was £2.4 billion (or 16.1%) less than in October 2024.

Public sector net investment comprises acquisitions, less disposals of capital assets (gross fixed capital formation), less the depreciation of capital assets, plus capital grants to the private sector, less capital grants from the private sector.

Net investment was £4.8 billion in October 2025, which was £0.6 billion (or 13.5%) more than in October 2024.

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.

Our Public sector finances borrowing by subsector: Appendix R dataset provides further detail on data presented in Table 1, including transactions related to borrowing by each subsector and their contribution to total public sector borrowing in a matrix table format. The time period presented in the matrix table can be changed using the dropdown box feature.

Central government borrowing

Central government forms the largest part of the public sector and includes government departments such as HM Revenue and Customs, the Department of Health and Social Care, the Department for Work and Pensions, the Department for Education, the Ministry of Defence and other government agencies.

The relationship between central government's receipts and expenditure is an important determinant of public sector net borrowing. Of the £17.4 billion borrowed by the public sector in October 2025, central government borrowed £22.0 billion, with some other subsectors showing a surplus.

Central government current receipts

Central government's current receipts were £86.4 billion in October 2025, £5.8 billion (or 7.3%) more than in October 2024. Of this £5.8 billion increase in income:

• central government tax receipts increased by £3.0 billion to £63.6 billion; this included increases of £1.2 billion in Income Tax, £0.9 billion in Value Added Tax (VAT) and £0.6 billion in Corporation Tax receipts

• compulsory social contributions increased by £2.8 billion to £16.9 billion; on 6 April 2025, as changes to the rate of National Insurance contributions paid by employers came into effect

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 2025 are provisional. There is uncertainty around these estimates until more detailed departmental information becomes available over time.

Central government's current expenditure was provisionally estimated as £92.6 billion in October 2025, £3.7 billion (or 4.2%) more than in October 2024. Of this £3.7 billion increase in spending:

• net social benefits paid by central government increased by £2.1 billion to £27.7 billion; this was largely caused by inflation-linked increases in many benefits, and earnings-linked increases to state pension payments

• central government departmental spending on goods and services increased by £2.0 billion to £39.0 billion, as pay rises and inflation increased running costs

• payments to support the day-to-day running of local government increased by £0.3 billion to £12.5 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

• central government debt interest payable decreased by £0.9 billion to £8.4 billion, with movements in the Retail Prices Index (RPI) adding volatility to the monthly debt interest costs

Central government debt interest costs

Borrowing is largely financed by the issuance of central government gilts by the Debt Management Office, on which interest is paid to investors.

The interest payable on index-linked gilts rises and falls with the RPI, adding volatility to central government debt interest costs. This additional RPI inflation-linked component of interest is described as "capital uplift" and affects the value of the gilt principal.

The £8.4 billion interest payable on central government debt in October 2025 includes £2.6 billion of capital uplift. This largely reflects the 0.4% increase in the RPI between July and August 2025.

Capital uplift is accrued throughout the life of each index-linked gilt but is paid to gilt holders as interest at redemption. Accrued capital uplift is shown as the light blue portion of each stacked bar in Figure 2.

Central government net investment

Central government net investment was £12.1 billion in October 2025, £0.3 billion less than in October 2024.

In October 2025, central government made a £6.7 billion quarterly payment to the Bank of England (BoE) Asset Purchase Facility (APF) Fund. This recent payment was £0.5 billion smaller than the equivalent payment in October 2024. These payments are recorded as both central government net investment expenditure and BoE receipts, so have no impact on overall public sector borrowing (PSNB ex).

The public sector spent more than it received in taxes and other income in the financial year (FY) to October 2025. Provisional estimates show it borrowed £116.8 billion over the seven-month period, £9.9 billion (or 9.2%) more than the £106.9 billion forecast by the Office for Budget Responsibility in March 2025.

Borrowing in the FY to October 2025 was £9.0 billion (or 8.4%) more than in the FY to October 2024. This is the second-highest FY to October borrowing since monthly records began in 1993, after that of April to October 2020, during the coronavirus (COVID-19) pandemic period.

Of the £116.8 billion borrowed by the public sector in the FY to October 2025, the current budget deficit was £83.9 billion. This was £7.4 billion (or 9.7%) more than in the same seven-month period a year ago. Public sector net investment increased by £1.6 billion (or 5.1%) to £32.9 billion over the same seven-month period.

Central government net borrowing

The relationship between central government's receipts and expenditure is an important determinant of public sector net borrowing. Of the £116.8 billion borrowed by the public sector in the FY to October 2025, central government borrowed £121.9 billion, with some other subsectors showing a surplus.

Tables 1 to 3 in our Public sector finances summary tables: Appendix M dataset provide an extended presentation of Table 2 and a summary of central government receipts and expenditure data.

Central government current receipts

Central government's current receipts were £609.6 billion in the FY to October 2025, £42.5 billion (or 7.5%) more than in the same seven-month period a year ago. Of this £42.5 billion increase in income:

• central government tax receipts increased by £24.3 billion to £454.5 billion; this included increases of £12.8 billion in Income Tax, £4.9 billion in Value Added Tax (VAT) and £3.6 billion in Corporation Tax receipts

• compulsory social contributions increased by £18.5 billion to £114.4 billion, as on 6 April 2025, changes to the rate of National Insurance contributions paid by employers came into effect

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 current expenditure was provisionally estimated at £649.9 billion in the FY to October 2025, £51.2 billion (or 8.5%) more than in the same seven-month period a year ago. Of this £51.2 billion increase in spending:

• central government departmental spending on goods and services increased by £21.4 billion to £267.8 billion, as pay rises and inflation increased running costs

• interest payable on central government debt increased by £13.3 billion to £67.7 billion, largely because the interest payable on index-linked gilts rises and falls with the Retail Prices Index (RPI)

• net social benefits paid by central government increased by £11.5 billion to £190.4 billion, largely caused by inflation-linked increases in many benefits (including Universal Credit) and earnings-linked increases to state pension payments

• payments to support the day-to-day running of local government increased by £1.7 billion to £89.6 billion; these intra-government transfers have no impact on overall public sector borrowing (PSNB ex)

Central government net investment

Central government net investment was £56.2 billion in the FY to October 2025, £12.2 billion less than in the same seven-month period a year ago. Over this period, central government made payments totalling £14.1 billion to the Bank of England (BoE) Asset Purchase Facility Fund, £16.7 billion less than in the same seven-month period of 2024. These payments are recorded as both central government net investment expenditure and BoE receipts, so have no impact on overall public sector borrowing (PSNB ex).

Local government

Initial estimates suggest that local government borrowing was £3.5 billion in the FY to October 2025. This was £1.1 billion (or 43.7%) more than in the same period a year earlier. Our local government estimates for the FY to October 2025 are currently based on budget data for England, Scotland, and Wales, with estimates included for Northern Ireland. Local government estimates for FYE March 2025 are also provisional and will be updated next month to reflect some recently published data for local authorities in England. More information is available in Section 10: Data sources and quality).

Provisional estimates show the public sector borrowed £149.7 billion in the financial year ending (FYE) March 2025. This was the third-highest amount borrowed in any financial year since comparable records began in the FYE March 1947.

The highest amount borrowed in any financial year was £310.9 billion in the FYE March 2021 during the coronavirus (COVID-19) pandemic, and the second highest was £159.6 billion in the FYE March 2010 following the global financial downturn. However, these estimates have not been adjusted for inflation.

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.

We currently estimate that the total borrowed in the FYE March 2025 was equivalent to 5.1% of GDP, 0.3 percentage points higher than in the FYE March 2024.

Borrowing in the first seven months of the current financial year was provisionally estimated at 3.9% of GDP. This was 0.1 percentage points more than during the same period in 2024, and was the eighth-highest borrowing ratio in any April to October period since monthly records began in 1993.

We describe the methodology used for the presentation of our GDP ratios in our The use of GDP in public sector fiscal ratio statistics methodology.

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 post.

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

Public sector net debt excluding public sector banks (PSND ex) is a widely used balance sheet measure that describes the UK public sector's financial position at a point in time. 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 2025 was provisionally estimated at 94.5%, 0.2 percentage points less than a year ago. However, this is a highly provisional estimate. It is likely to be revised in future publications because it relies partly on GDP forecasts based on the Office for Budget Responsibility's Economic and fiscal outlook – March 2025 report.

Public sector net debt excluding the Bank of England (BoE) was £2,768.6 billion at the end of October 2025, or around 90.0% of GDP. This was £136.4 billion, or 4.5 percentage points of GDP, less than the wider measure of net debt (including the BoE). This difference was largely a result of the BoE's quantitative easing activities, including the gilt-purchasing activities of the Asset Purchase Facility (APF) Fund.

The APF Fund's gilt holding is not recorded directly as a component of public sector net debt. Instead, in October 2025, we recorded the £86.3 billion difference between the £556.0 billion of reserves created to purchase its gilts (at market value at the time of purchase) and their £469.7 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) were £2,583.5 billion at the end of October 2025 and equivalent to an estimated 84.0% of GDP. This was £187.3 billion, or 2.5 percentage points, more than at the end of October 2024.

PSNFL ex adds further assets and liabilities to those recorded in debt (PSND ex). These extra assets are currently valued at more than the extra liabilities. This means that PSNFL ex was 10.5 percentage points of GDP less than PSND ex, which stood at 94.5% of GDP at the end of October 2025.

We explain the financial assets and liabilities captured in PSNFL ex in our Public sector net financial liabilities (PSNFL) methodology.

Additionally, we published a blog post explaining the PSNFL measure, because it has been selected by the UK government as the reference for a balance sheet fiscal rule.

The additional financial assets and liabilities included in PSNFL ex that fall outside of the PSND ex boundary are not updated monthly. Instead, they are updated quarterly, or when data become available. These data were updated on 19 September 2025 and will next be updated on 19 December 2025.

A more detailed presentation of the public sector balance sheet is available in our Public sector net worth: Appendix O dataset, released on 19 September 2025.

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 2025 bulletin, published on 21 October 2025. 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 in the financial year to September 2025

We have reduced our provisional estimate of public sector net borrowing (PSNB ex) in the FY to September 2025 by £0.4 billion to £99.4 billion since publishing our Public sector finances, UK: September 2025 bulletin.

Table 4 of our Public sector finances summary tables: Appendix M dataset presents the revisions to our previously published estimates of public sector net borrowing by subsector.

We have increased our previous estimate of central government net borrowing for the seven months to September 2025 by £0.5 billion. This increase was offset by a reduction in our previous estimate of local government net borrowing of £1.0 billion over the same period.

Regular monthly updates to our central government data have reduced our previous estimate of central government receipts by £0.4 billion and increased our previous estimate of spending by £0.1 billion.

Within this increase to our spending estimate, small reductions spread across several categories were offset by a £1.0 billion increase to our estimate of current transfers to local government. Such transfers are public sector borrowing neutral, increasing central government borrowing and reducing local government borrowing by equal and offsetting amounts.

Tables 5 to 6 of our Appendix M dataset present the revisions to our previously published estimates of central government receipts and spending by component.

Revisions to public sector net borrowing in earlier financial years

We have increased our provisional estimates of public sector net borrowing in both the FY to March 2024 and FY to March 2025, by £0.1 billion and £0.3 billion, respectively, since publishing our Public sector finances, UK: September 2025 bulletin. These increases were both because of regular updates to our corporation tax data.

Revisions to public sector net debt at the end of September 2025

We have increased our estimate of public sector net debt (PSND ex) at the end of September 2025 by £0.7 billion to £2,916.9 billion, since publishing our Public sector finances, UK: September 2025 bulletin.

This increase was largely because of updates to data used to estimate the Bank of England's contribution to debt, which are published one month in arrears.

Revisions to gross domestic product

This month, we have updated our previous estimates of nominal gross domestic product (GDP) with those published in our GDP first quarterly estimate, UK: July to September 2025 release on 13 November 2025.

Published GDP in the latest quarter was higher than previously estimated, meaning that our headline balance sheet figures expressed as a ratio of GDP reduced in recent periods.

Our estimate of public sector net debt as a ratio of GDP at the end of September 2025 reduced by 0.2 percentage points from 95.3% to 95.1%. This was largely because of this update to GDP.

Our How the Office for National Statistics (ONS) estimates UK debt to GDP figures blog post 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 last 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 income 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 our accompanying Monthly statistics on the public sector finances: a methodological guide and Public sector finances quality and methodology information (QMI) 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, 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.

Central government tax receipts and social contributions

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 (PAYE) 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 largely reflect the expectations published in the Economic and fiscal outlook – March 2025 report from Office for Budget Responsibility.

Value Added Tax data

On 8 October 2025, HM Revenue and Customs (HMRC) reported an under-estimation in its VAT cash receipts data for the period April to August 2025.

HMRC has implemented immediate improvements to quality assurance processes, including comparisons with independent data sources, working with HM Treasury and the Office for National Statistics (ONS). HMRC will also carry out a robust review across all receipts to consider the underlying issue, and to identify actions to minimise the risk of similar incidents in future.

The ONS and HM Treasury are engaging with this process to lend their support to it. The Office for Statistics Regulation will provide an independent perspective on HMRC's review to ensure compliance with the Code of Practice for Statistics.

The ONS will report on progress with work to improve the quality of public sector finance statistics as part of the first quarterly update on the Economic Statistics Plan, scheduled for December 2025.

Local government

Local government data for the financial year ending (FYE) March 2026 are provisional estimates for the UK. They are largely based on budget data for England, Scotland and Wales, and with estimates included for Northern Ireland.

Local government data for the FYE March 2025 also remain provisional estimates for the UK. For local authorities in England, estimates for current expenditure are based on published first release data, while capital expenditure and receipts are based on published provisional data. England estimates will be updated to reflect final outturn data for capital expenditure and receipts in our next release, publishing on 19 December 2025.

Estimates for the devolved governments for the FYE March 2025 are based on published budget data for Wales, published provisional outturn data for Scotland, and estimates 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 may include adjustments to increase or decrease the amounts reported at the budget stage.

For the FYE March 2025, these adjustments include:

• a £2.4 billion upward adjustment to Scotland's current expenditure

• a £0.5 billion downward adjustment to Wales's capital expenditure

For the FYE March 2026, these adjustments include:

• a £2.0 billion upward adjustment to England's current expenditure

• a £2.4 billion upward adjustment to Scotland's current expenditure

• a £0.4 billion downward adjustment to Scotland's capital expenditure

To reflect the most recently available data for housing benefits, we have applied a further £3.1 billion downward adjustment to current expenditure in the FYE March 2026. 

Public corporations

Data for public corporations in the financial year ending (FYE) March 2026 are highly provisional initial estimates for the UK. They are largely based on the Office for Budget Responsibility's (OBR's) Economic and fiscal outlook – March 2025 report.

Data for public corporations in FYE March 2024 and FYE March 2025 remain largely based on the OBR's Economic and fiscal outlook – October 2024 report, and are 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 – March 2025 report. The Autumn Budget 2025 will take place on 26 November 2025 and will be accompanied by updated forecasts presented in the Economic and fiscal outlook – November 2025 report.

The UK's fiscal targets

The UK government has legislated for targets to constrain its management of the public finances. The Autumn Budget 2024 announced that, from January 2025, these fiscal targets focus on the public sector current budget deficit and public sector net financial liabilities.

The current budget deficit

The UK government has set a target to bring the current budget into surplus by the end of the FYE March 2030 – in other words, that the public sector's day-to-day spending should be met by its revenues. The public sector would, therefore, be forecast to be only borrowing for investment (capital) spending.

Our latest figures show that the public sector current budget deficit was £76.1 billion in the FYE March 2025; this was £9.7 billion more than in the FYE March 2024.

Public sector net financial liabilities

The present UK government target is that, by the end of March 2030, public sector net financial liabilities (PSNFL) should be falling relative to the size of the economy (or GDP) compared with the previous year.

Our latest figures show that PSNFL was provisionally estimated at 81.2% of GDP at the end of March 2025; this was 1.5 percentage points more than at the end of March 2024.