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Sunday, 1 November 2026 Business · World · Analysis
THE BUSINESS TIME
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The Business TimeBudget 2026
Budget 2026

UK public debt passes £3 trillion: the state is borrowing more than expected – a week before the Budget

In September the state borrowed £24.5bn – £1.9bn more than forecast. Public debt exceeded £3 trillion for the first time. ONS data from 21 October.

HM Treasury building in London

On 21 October 2026 the Office for National Statistics (ONS) reported that public sector borrowing in September was £24.5bn. That is £1.8bn more than a year earlier and £1.9bn more than the OBR had forecast. Borrowing from April to September totalled £97.8bn – £6bn above the forecast, though £4.4bn less than a year ago.

Interest on central government debt alone cost £10.9bn in September, 16.6% more than a year earlier. About £4bn of that was due to bonds linked to RPI inflation. Public sector net debt stood at about £3,005bn – above £3 trillion for the first time. That is 94% of GDP.

The data come a week before the Budget set for 28 October. The next ONS public finance data are due on 20 November.

Editorial comment

Higher borrowing and rising interest reduce the government’s room for manoeuvre. That increases the risk of tax or charge rises in the Budget. For now, however, it is only speculation – we will learn the actual decisions on 28 October. Business owners should not make hasty decisions before that date.

What to do

  • Set aside a reserve for possible higher costs from April 2027.
  • Talk to your accountant about dividend and investment plans before the Budget.
  • Do not believe “sure-fire leaks” online – wait for the official documents on gov.uk.
  • On 28 October read our special edition on the Budget.

What do you think?

Do you feel this in your business? Tell us in the comments below the article. We will cover the most interesting views in future editions.

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