PwC comments on Public Sector Finance data for July 2025

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

“Public sector net borrowing totalled £1.1bn in July 2025, £2.3bn lower than the same month last year and the third-lowest July figure since records began. Although July typically sees higher receipts due to self-assessed taxes, revenues still rose sharply, up £9.2bn compared to July 2024.

“Debt interest payments reached £7.1bn in July, £0.2bn more than in July 2024. Higher debt servicing costs as a share of total revenues will leave the public finances more exposed to future economic shocks.

“Although tax receipts rose in July, the Chancellor remains under pressure as she tries to balance weak growth with the fiscal rules she has committed to. While the government’s manifesto promises to maintain investment and shield working people from tax hikes, analysis from NIESR suggests up to £40bn in additional revenue may be needed to restore headroom and maintain investor confidence in the UK’s public finances. As the Chancellor prepares for the Autumn Budget, the challenge will be finding creative sources of revenue while treading carefully around the impact on living standards.”