UK government borrowing hits record for February

UK government borrowing hit a record high for February due to the energy support scheme, according to figures released on Tuesday by the Office for National Statistics.

Public sector net borrowing came in at £16.7bn, up from £7.1bn in February 2022 and above consensus expectations of £11.4bn. It marked the highest level for the month of February since records began in 1993.

However, the data also showed that debt interest payments fell by £1.3bn on the year to £6.9bn.

Chancellor Jeremy Hunt said: Chancellor Jeremy Hunt said: "Borrowing is still high because we're determined to support households and businesses with rising prices and are spending about £1,500 per household to pay just under half of people's energy bills this winter.

"What will bring these costs right down is lower inflation, which is why it remains one of our top priorities to halve it this year, alongside growing our economy and reducing debt."

Ruth Gregory, deputy chief UK economist at Capital Economics, said: "The news on the public finances may have raised the Chancellor’s hopes that he will be able to announce a pre-election giveaway later this year.

"But the big risk is that a further escalation in the banking crisis causes a deterioration in the fiscal outlook as the hit to the public finances from weaker economic growth is only partially cushioned by lower gilt yields."