UK government finances better than expected in January

2 weeks ago 3

Getty Images Rachel Reeves walking outside Number 11 Downing Street, smiling and wearing a green blazer.Getty Images

Chancellor Rachel Reeves has come under criticism for her public borrowing rules

The government's finances had a record monthly surplus in January as it took in more tax receipts than it spent.

The surplus - the difference between public spending and the tax take - was £30.4bn in January, according to the Office for National Statistics (ONS).

The ONS said it was the highest surplus in any month since records began in 1993, and more than double last January's £15.4bn monthly surplus.

Analysts had expected the surplus to be £23.8bn. The government usually collects more tax than it spends in January compared with other months due to the collection of self-assessed taxes.

Borrowing in the 10 months to January was £112.1bn - 11.5% lower than the same 10 month period a year ago - although the ONS noted that it was the fifth-highest borrowing for the period on record.

HM Treasury said borrowing for 2026 is forecast to be "the lowest since before the pandemic."

Chief Secretary to the Treasury, James Murray said: "We know there is more to do to stop one in every £10 the government spends going on debt interest, and we will more than halve borrowing by 2030-31 so that money can be spent on policing, schools and the NHS."

Separately, retail sales grew more than expected in January, according to official data

The amount of goods bought rose by 1.8% in January, up from 0.4% in December, the ONS reported.

City economists had expected a rise of 0.2%.

The performance was boosted by strong demand for sports supplements and jewellery. Sales of artwork and antiques also did well.


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