PwC comments on Public Sector Finance data - June 2026

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

“Public sector net borrowing came in at £23.3bn in May 2026, £5.4bn more than was recorded in May last year and £5.6bn more than the forecast from the OBR. Total public sector receipts did increase by £3.7bn from last May, but this was outweighed by the £9.1bn increase in total public sector spending - driven by higher costs of benefits, public service delivery and debt interest costs.

“Debt interest payments reached £11.7bn in May, £4.1bn more than a year ago and the highest in any May on record. Higher debt servicing costs as a share of total revenues leave the public finances more exposed to future economic shocks.

“This month’s borrowing figures offer little reassurance, and the public finances are unlikely to feel much relief while inflation risks remain live. With energy-driven price pressures still a risk, the Bank of England has so far kept the Bank Rate at 3.75%, underlining the prospect of borrowing costs staying higher for longer. That matters because elevated rates feed through into debt-servicing pressures - which are already high - limiting the Chancellor’s room for manoeuvre while financing conditions remain tight. In that sense, the challenge is not just the level of monthly borrowing, but how quickly those financing conditions genuinely ease.”