Public sector borrowing reached £10.7 billion, marking a £0.1 billion rise compared to February 2024 and the fourth highest February borrowing since records began in 1993. Similarly, the current budget deficit surged to £3.3 billion, down £1.0 billion from February 2024, the lowest February deficit since 2022. This indicates easing of day-to-day funding pressures.

Debt servicing costs rose, with interest on central government debt reaching £7.4 billion, the same as February 2024 and driven largely by retail price index fluctuations. Cumulatively, borrowing in the financial year to February 2025 amounted to £132.2 billion, £14.7 billion higher year-over-year, making it the third-highest February borrowing on record.

Public sector net debt excluding banks stood at 95.5 percent of GDP, 0.1 percent higher than a year ago. Net financial liabilities were estimated at 82.9 percent of GDP, underscoring a gap between liabilities and overall debt. Additionally, the central government net cash requirement rose to £8.4 billion, highlighting fiscal strains.

These trends underscore fiscal pressures requiring economic management and targeted policy interventions.

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.