In April 2025, UK public sector borrowing rose to £20.2 billion, marking a £1.0 billion increase from April 2024 and ranking as the fourth-highest April figure since 1993. This rise was also about £6.1 billion above the previously revised figure for the previous month. For the financial year ending March 2025, total borrowing stood at £148.3 billion, £11.0 billion above the Office for Budget Responsibility's (OBR) forecast, though slightly revised down from earlier estimates.

The current budget deficit was also higher than forecast at £70.3 billion. Notably, public sector net debt excluding public banks reached 95.5 percent of GDP, its highest since the early 1960s, signalling persistent fiscal pressures. Meanwhile, net financial liabilities were lower at 83.5 percent of GDP, reflecting differences in accounting for financial assets.

Despite these burdens, the central government's net cash requirement fell to £15.8 billion, £2.6 billion less than a year earlier. However, caution is needed when interpreting early-year figures, as they are heavily reliant on provisional data and likely to face revisions. These developments suggest a widening gap between fiscal targets and outcomes, highlighting the challenge of balancing economic recovery with fiscal sustainability in a high-debt environment.

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.