Unexpected UK borrowing surge adds to pre-Budget pressure on chancellor
Borrowing was higher than expected in August as inflation piles pressure on the government ahead of the Budget.
An unexpected surge in government borrowing in August, driven by persistently higher inflation, has added to pressure on Chancellor John Healey as he prepares to deliver his first Budget at the end of October.
Borrowing - the difference between tax receipts and government spending - was £18.3bn in August, almost a fifth higher than the year before, the Office for National Statistics (ONS) said.
Inflation rose to its highest rate in five months in August in the UK, driven up by higher petrol and diesel prices.
About a quarter of the interest paid on UK public sector debt is linked to the Retail Prices Index, a measure of inflation which tends to be a higher rate than the Consumer Prices Index measure used to calculate the UK's headline rate.