UK Government Borrowing: April 2026 Starts the Fiscal Year on the Back Foot

The UK recorded a £24.3bn deficit in April 2026 — the highest April borrowing figure since 2020 and significantly above official forecasts. The latest data from the Office for National Statistics (ONS) signals a challenging start to the 2026/27 financial year and highlights the limited fiscal room available to whoever occupies Downing Street later this year.

A Weak Start to 2026/27

Public sector net borrowing excluding banks (PSNB ex) reached £24.3bn, overshooting expectations across the board:

• £4.9bn higher than April 2025
• £5.0bn higher than April 2024
• £4.3bn higher than April 2023
• £3.4bn above the OBR’s March 2026 monthly profile
• £3.4bn above Reuters’ consensus forecast
• Already 18.1% of the OBR’s full‑year borrowing projection

This marks the worst April deficit in six years (nominal terms).

Current Budget Deepens

The current budget deficit — the measure tied directly to the Chancellor’s fiscal rule requiring balance by 2029/30 — came in at £17.4bn.
This is:

• £3.4bn worse than April 2025
• £2.6bn worse than the OBR expected

The deterioration underscores the structural pressures on day‑to‑day spending.

2025/26 Outturn Revised Down

There was one bright spot: the updated estimate for 2025/26 borrowing is now £129.0bn, which is:

• £22.9bn lower than 2024/25
• £3.7bn below the OBR’s Spring Budget forecast

However, this improvement is overshadowed by the weak opening month of the new fiscal year.

Debt Continues to Rise

Public sector net debt excluding banks (PSND ex) rose to £2,943.0bn, equivalent to 94.2% of GDP — up from 93.7% a year earlier.
The Chancellor’s preferred measure, PSNFL ex, reached £2,613.7bn (83.6% of GDP), £176.1bn deeper in the red than a year ago.

Interest Payments Hit a Record April High

Debt interest payments totalled £10.3bn, making it:

• £7.1bn higher than March’s unusually low figure
• £0.9bn higher than April 2025
• £0.4bn above the OBR’s projection
• The highest April interest bill on record (nominal)

This reinforces how sensitive the public finances remain to inflation and gilt yields.

Outlook

These figures are not the start the Chancellor — or the Prime Minister — would have hoped for. With borrowing overshooting expectations and debt ratios edging higher, the next government will inherit tight fiscal rules and minimal headroom.
The message from April’s data is clear: fiscal policy options will be constrained throughout 2026/27.