UK government borrowing falls £7.9bn compared to last year

The UK government borrowed £7.9bn less in June than it did in the same month last year, according to new figures from the Office for National Statistics.

Borrowing – the difference between what the government spends and what it collects in taxes – came in at £16bn for the month, slightly below the £16.3bn forecast by the Office for Budget Responsibility.

So far this financial year, total borrowing has reached £57.6bn, down £3.7bn from the same period last year.

Ruth Gregory, deputy chief UK economist at Capital Economics, described June's figure as "a rare piece of good news" for the new prime minister and his chancellor John Healey.

While the ONS noted that total debt remains high by historical standards and close to the annual value of the UK economy, the lower-than-expected borrowing offers some room for manoeuvre as the government sets out measures to cut living costs for households.

Gilbert