₦airaland Forum

UK government borrowing came in more than forecast in June, a setback for Chancellor of the Exchequer Rachel Reeves that will fan speculation over potential tax hikes to shore up the public finances.

A surge in debt-interest payments sent the budget deficit to £20.7 billion ($27.9 billion), the Office for National Statistics said on Tuesday, £6.6 billion more than a year earlier and well above the £17.5 billion economists surveyed by Bloomberg expected.

Borrowing in the first three months of the fiscal year was £57.8 billion, around £7.5 billion higher than a year earlier and in line with the forecast made by the Office for Budget Responsibility in March. The deficit had been running billions below official projections in April and May.

The level of borrowing leaves Reeves with a hole to fill in her autumn budget. Her fiscal plans have been knocked by recent U-turns over billions of pounds of spending cuts. There are also fears of a downgrade to official growth projections, leading many economists to warn that higher taxes are inevitable.

The chancellor is caught between febrile bond markets worried about government debt levels across advanced economies and rebellious Labour lawmakers who recently forced the government to pull back on reforms to welfare spending. Reeves has stood firm on her fiscal rules, which include a promise to fund everyday government spending with tax receipts by the end of the decade.

Gilts fell more than their German and US peers following the release, lifting the UK 10-year yield three basis points to 4.63%.

The deficit in June was boosted by a £16.4 billion debt-interest payment, the third highest for any month on record. The £8.4 billion surge from a year earlier was driven by a jump in inflation in April increasing the cost of servicing bonds linked to the Retail Prices Index, which make up a quarter of the total debt stock. However, this effect won’t be repeated in July, as the RPI barely rose in May.

“Things will probably get worse for the chancellor,” said Alex Kerr, UK economist at Capital Economics. “We think that she will need to raise £15-25 billion at the Budget later this year, with higher taxes doing most of the heavy lifting.”

The ONS said government receipts in June continued to be bolstered by the hike in employer payroll taxes that came into effect in April. Revenue came in at £86.8 billion, £5.7 billion more than a year earlier. Compulsory social contributions, which reflect the increase in national insurance contributions, were £48 billion for the first three months of the fiscal year, £7.5 billion higher than last year.

However, it was more than offset by rising spending with government expenditure in June climbing £12.4 billion to £97.1 billion. Besides debt costs, spending was also boosted by higher outlays on welfare and public-sector wages.

Net debt stood at £2.9 trillion, or 96.3% of GDP, in June — around the highest levels since the early 1960s. A wider view of the public finances used for the chancellor’s fiscal rules, known as public sector net financial liabilities, came in at £2.5 trillion, or 83.8% of GDP.

The Bank of England’s upcoming decision on quantitative tightening will be one factor determining the fiscal outlook. The Treasury is having to stump up for losses related to the BOE’s bond operations that are running into the tens of billions of pounds. There has been speculation it will halt sales of long-dated debt after signs of fragility in that part of the market.

Sources: https://fortune.com/europe/2025/07/22/uk-borrows-billions-more-than-expected-as-debt-costs-surge-rachel-reeves/

https://www.reuters.com/world/uk/uk-borrows-more-inflation-adds-debt-bill-reeves-headache-2025-07-22/

This is seriously serious.

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UK colonized Nigeria, debts runs in their blood so we are not surprised.
But for Nigerian politicians they've nothing to do with the fund$ being borrowed.

Interesting times ahead.

I believe there are ways to make the.most of these trying times.

President Tinubu, the best President in the world. Na beg I dey beg you o! Abeg no follow those dem president wey don throw their citizens inside one chance o.

Who didn't see this coming? This is just a microcosm of the wider Western economic crisis. High debt, weakening growth, limited political space for reform, and bond markets growing nervous. Then we have BRICS around the corner The model of “borrow now, stimulate growth, worry later” is no longer working. BRICS has exposed them. Ee ti rinkankan.

Na dem sabi

E nor consign us here
Almost everything in Nigeria has x5-x10 in the last 12 years.
My proposed solution is that the government should remove or hide one-zero from one currency.
E.g, whatever we're buying for 100 now should cost only 10, but salaries should remain the same
That's, minimum wage should remain 70k.
Sense no go kill me

manuelkel:
UK colonized Nigeria, debts runs in their blood so we are not surprised.

UK borrow to sustain production unlike Nigeria that borrow to loot and consume. The difference is clear. We didn't learn anything from them as former colonial master.

manuelkel:
UK colonized Nigeria, debts runs in their blood so we are not surprised.
But for Nigerian politicians they've nothing to do with the fund$ being borrowed.

What of US? Did they colonised Nigeria too? At least Nigeria govt hasn't appealed to her citizens to donate for the govt to settle her debt like US

Nigeria wan get excuse for borrowing money..Awon werey gbogbo

Great100000:
Sources: https://fortune.com/europe/2025/07/22/uk-borrows-billions-more-than-expected-as-debt-costs-surge-rachel-reeves/

https://www.reuters.com/world/uk/uk-borrows-more-inflation-adds-debt-bill-reeves-headache-2025-07-22/

The cost of fighting Russia in a proxy war they senior brothers are now begging 🙏 citizens to control to their debt 💸.

I know it just a scam because they can easily print more money and nothing will happen.

Just like they did during Covid.

Without colonialism and being a global power UK cannot survive. China has taken their market share and the slow decline is evident

They should increase income taxes and pay off the debt.
80% wont be bad. That way, they can get the country on the right track.

Nice, Nigeria should borrow more for looting.

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UK is a failing economy

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manuelkel:
UK colonized Nigeria, debts runs in their blood so we are not surprised.
But for Nigerian politicians they've nothing to do with the fund$ being borrowed.

So debt runs in the yansh of USA with $36 trillion and China with about $17 trillion ?
Even small South Africa has a debt of more than $600 billion dollars at the end of 2024.
Nigeria is owing mere $105 billion o.

The main thing is for govts to utilize the loans positively and not pocket them.
Secondly,the debt is jointly owed by the FG,state govts and the lgs.

All these news about the superpowers' debt surge are targeted to justify unbridled borrowings by APC-led government.

israelmao:
All this news about the superpowers' debt surge are targeted to justify unbridled borrowing by APC-led government.

Yes,they must borrow.A nation that doesn't borrow is dead.Just utilize the loan diligently.
Even during the time of Jonathan,when oil was being sold like craze and we had humongous revenue,Jonathan still borrowed.
The loans and everything then was swallowed by the corrupt leadership.
They were borrowing money to pay workers until 2014 before Pa Buhari came on board in 2015.

Nigerian govt don see excuses to justify their impotence

Don't be deceived. They know something is coming and they will borrow more.

In fact, any country that does not borrow more for the coming days is not wise.

Nigeria should borrow more.

Because the global reset and dollar collapse are coming.

And they will term it a season of jubilee, where all debts will be forgiven.

Everyone living on debt.
US, UK, Egypt, Naija..

It is well with naija

Tolu2024:
The cost of fighting Russia in a proxy war they senior brothers are now begging 🙏 citizens to control to their debt 💸.

I know it just a scam because they can easily print more money and nothing will happen.

Just like they did during Covid.

The US cannot print money without potential negative consequences. While the US dollar's status as the global reserve currency provides some insulation, excessive money printing can still lead to inflation, decreased purchasing power, and a loss of confidence in the currency.

Trying to keep up with the rest of the world, no more slavery missions and stealing peoples assets now they're borrowing.

Yet they are financing a war they can’t win while millions of their citizens are facing the scourge of poverty

That's the U.S business.

I hope Nigerians don't see this as a reason to justify the sorry state of the country and say even US borrow too, we can do better than this please.

Believe these lies at your own peril, from US to UK.

They own these institutions and this is trick to make Africans not to revolt against their leaders borrowing. I honestly donbilivit

They are using it to feed illegal migrants crossing through boats while they scrutinize law abiding migrants, check criminal records, check that you have enough money in your bank account to house and feed yourself.

Nations borrow money for a variety of reasons, including funding budget deficits, financing large infrastructure projects, and stabilizing their economies. Borrowing allows governments to spend beyond their current tax revenues, supporting public services, investments, and economic growth.

Ustec:
Everyone living on debt.
US, UK, Egypt, Naija..

Only Russia is safe, No wonder they kept those debtors on their kneels while at war with Ukraine.

Russia's total public debt in 2025 is a mix of domestic and external debt, with the domestic component dominating. As of March 2025, Russia's external debt was $317.5 billion. While the total public debt figure for 2025 isn't explicitly stated, it's clear that domestic debt is significantly larger, reaching 79% of GDP as of April 1, 2025