Borrowing exceeds forecasts by nearly £15bn in blow to Reeves

Rachel Reeves could be forced to raise taxes or announce deeper cuts to public spending after figures revealed UK borrowing overshot official forecasts by almost £15bn in the last financial year.

- Richard Partington

With the British economy coming under mounting strain amid Donald Trump's escalating trade war, the Office for National Statistics (ONS) said yesterday that borrowing in the financial year ending in March was £151.9bn, more than £20bn higher than in the previous financial year.

After a larger-than-anticipated rise in borrowing in March, the figure was £14.6bn more than the Office for Budget Responsibility (OBR) had predicted less than a month ago in forecasts published alongside the chancellor's spring statement.

In a setback for the government, economists warned that Reeves could be forced to put up taxes or cut public spending further at the autumn budget if she wanted to maintain her self-imposed fiscal rules.

"Public borrowing was overshooting the OBR's forecast even before the influence from the tariff chaos is felt," said Ruth Gregory, the deputy chief UK economist at the consultancy Capital Economics.