What changed this month?

The government borrowed £18.3 billion in August 2026, the gap between what it spent and what it raised. That was £2.9 billion (19.0%) more than in August 2025 and the second-highest August since monthly records began, behind only 2020. It was also £3.5 billion more than the OBR had forecast for the month.

Why did borrowing move?

Spending grew faster than receipts. Total central government spending, including investment, rose £4.9 billion on the year while receipts rose £3.3 billion, so central government borrowing rose £1.6 billion, and local government borrowed £1.5 billion more than a year earlier.

What happened to tax receipts?

Central government receipts were £89.8 billion, up £3.3 billion (3.8%) on August 2025. Income-related taxes rose 6.6% and corporation tax 4.7%, but VAT rose only 1.7%. The ONS notes that a temporary cut in the VAT rate on certain family-focused activities and children's meals, from 25 July to 1 September 2026, reduced VAT receipts while it ran. Self-assessment income tax for July and August together was £18.6 billion, £1.9 billion more than a year earlier but £0.4 billion below forecast.

What happened to spending?

Central government day-to-day spending was £93.9 billion, up £3.8 billion (4.3%) on the year. Net social benefits rose £1.9 billion and spending on goods and services rose £2.2 billion, both outpacing the growth in receipts.

What happened to debt interest?

Central government interest payable was £8.8 billion in August, £0.4 billion more than a year earlier and the highest August since monthly records began in 1997, though lower than in each of the first three months of the financial year. The RPI-linked capital uplift on index-linked gilts accounted for £2.1 billion of it, reflecting a 0.3% rise in RPI between May and June 2026.

How does this compare with the OBR forecast?

Borrowing was £3.5 billion above the OBR's forecast for the month. For the financial year so far, borrowing of £77.3 billion is £2.2 billion lower than the same period last year but £8.1 billion above the OBR's forecast, mostly because central government spending is running £7.4 billion above profile, with social benefits and debt interest the largest parts. This release also carried the ONS annual data alignment, which revised borrowing for the whole of 2025-26 up by £4.5 billion to £134.3 billion, or 4.4% of GDP. One month is a weak guide and figures are routinely revised.

Monthly update: August 2026

Borrowing in August was the second highest for the month on record, up a fifth on last year and well above the official forecast, as spending grew faster than receipts.

Released 22 September 2026. provisional

What changed, and why

What changed this month?: The government borrowed £18.3 billion in August 2026, the gap between what it spent and what it raised. That was £2.9 billion (19.0%) more than in August 2025 and the second-highest August since monthly records began, behind only 2020. It was also £3.5 billion more than the OBR had forecast for the month.
Why did borrowing move?: Spending grew faster than receipts. Total central government spending, including investment, rose £4.9 billion on the year while receipts rose £3.3 billion, so central government borrowing rose £1.6 billion, and local government borrowed £1.5 billion more than a year earlier.
What happened to tax receipts?: Central government receipts were £89.8 billion, up £3.3 billion (3.8%) on August 2025. Income-related taxes rose 6.6% and corporation tax 4.7%, but VAT rose only 1.7%. The ONS notes that a temporary cut in the VAT rate on certain family-focused activities and children's meals, from 25 July to 1 September 2026, reduced VAT receipts while it ran. Self-assessment income tax for July and August together was £18.6 billion, £1.9 billion more than a year earlier but £0.4 billion below forecast.
What happened to spending?: Central government day-to-day spending was £93.9 billion, up £3.8 billion (4.3%) on the year. Net social benefits rose £1.9 billion and spending on goods and services rose £2.2 billion, both outpacing the growth in receipts.
What happened to debt interest?: Central government interest payable was £8.8 billion in August, £0.4 billion more than a year earlier and the highest August since monthly records began in 1997, though lower than in each of the first three months of the financial year. The RPI-linked capital uplift on index-linked gilts accounted for £2.1 billion of it, reflecting a 0.3% rise in RPI between May and June 2026.
How does this compare with the OBR forecast?: Borrowing was £3.5 billion above the OBR's forecast for the month. For the financial year so far, borrowing of £77.3 billion is £2.2 billion lower than the same period last year but £8.1 billion above the OBR's forecast, mostly because central government spending is running £7.4 billion above profile, with social benefits and debt interest the largest parts. This release also carried the ONS annual data alignment, which revised borrowing for the whole of 2025-26 up by £4.5 billion to £134.3 billion, or 4.4% of GDP. One month is a weak guide and figures are routinely revised.

Monthly update: August 2026

Borrowing this month

What changed, and why

A note on monthly figures