Overall public sector net borrowing (PSNB) was £19.22 billion in May, down from a smaller revised £22.00 billion in April and, more significantly, some £10.7 billion more than a year ago. This was the second-highest May borrowing since records began in 1993 and largely reflected the additional costs of the energy support schemes, increases in benefit payments and staff costs. Excluding public sector banks (PSNB-X), net borrowing stood at £20.05 billion versus £22.82 billion in April and £9.37 billion in May 2022.

For the financial year to May, PSNB-X was £42.9 billion, £19.6 billion more than in the same period last year and £2.1 billion higher than the £40.8 billion forecast by the Office for Budget Responsibility.

Of note, public sector net debt reached £2.567.2 billion in May and is provisionally estimated at 100.1 percent of GDP. The last time that the debt-to-GDP ratio was above 100 percent was March 1961.

The public sector net borrowing requirement (PSNB) is the difference between the sector's receipts and expenditure and so provides a simple measure of government fiscal policy. In response to the global economic crisis in 2008/09 the UK government introduced a number of measures designed to show the underlying state of public sector finances by omitting temporary distortions caused by financial interventions. It bases its fiscal policy on these measures. To this end, the underlying gauge of government borrowing watched most closely by financial markets is the PSNB-X which takes overall net borrowing (PSNB) but excludes public sector banks.

Changes in public sector finances can be used to determine the thrust of the government's fiscal policy. Generally speaking when the government has a rising deficit (or falling surplus) it is loosening its fiscal stance with a view to boosting economic activity. When its deficit is falling (or surplus rising), fiscal policy is being tightened in order to slow economic growth. However, sometimes changes in government financial positions can be due to factors outside of the government's control and do not signal an explicit shift in policy. This means that great care is needed in interpreting the data.