PwC comments on Public Sector Finance data - March 2026

Commenting on the latest ONS public sector finance data, Nabil Taleb, economist at PwC UK, says: 

“Public sector net borrowing came in at £14.3bn in February 2026, £2.2bn more than was recorded in February last year and the second-highest February borrowing since records began. Financial year-to-date borrowing was around 8.7% lower than in the same period a year ago, but still the fourth-highest April to February borrowing on record. 

“Debt interest payments reached £13.0bn in February, £5.5bn more than a year ago. The increase partly reflects the timing of payments, with some interest due at the end of January falling into February because of the intervening weekend. Nonetheless, the interest payable on central government debt remains elevated. Higher debt servicing costs as a share of total revenues leave the public finances more exposed to future economic shocks. 

“Recent months had pointed to some tentative improvement in the fiscal outlook, with easing inflation, expectations of rate cuts, and firmer revenues offering the Chancellor a little more breathing space. But the escalation of conflict in the Middle East has quickly reintroduced uncertainty. Interest rates cuts are inevitably deferred, inflation now looks set to pick up again, and growth remains subdued. That combination risks putting renewed pressure on borrowing and leaves the public finances exposed, underlining just how quickly the fiscal picture can shift.”