This figure is an increase from the £19.1bn shortfall recorded in April 2024 and surpassed economists’ forecasts of £17.9bn.

The ONS attributed April’s overshoot primarily to a £6.6bn year-on-year increase in spending on public services and benefits. While government receipts also rose by £5.6bn, partly driven by higher employer National Insurance contributions announced by Chancellor Rachel Reeves at the Budget, this was not enough to offset the increased expenditure.

This development places considerable pressure on Chancellor Reeves ahead of her first spending review for the Labour government on 11 June. She is tasked with adhering to her fiscal rule of balancing day-to-day spending with revenues by 2029-30, alongside ambitions to improve public services and stimulate economic growth. Her already slender fiscal headroom, last estimated at £9.9bn, faces further potential strain from the economic impact of US President Donald Trump’s tariffs.

Professor Joe Nellis, economic adviser to MHA, which has offices in Edinburgh and Aberdeen, described the April borrowing figure as “concerning”, noting it “continues to put strain on her slim fiscal headroom”. He highlighted that yields on UK bonds are relatively high and have risen further, increasing government debt interest costs, which the Office for Budget Responsibility (OBR) has warned could exceed £100bn a year.

Professor Nellis added that low growth forecasts result in lower tax revenues, making it “almost impossible for the Chancellor to balance public spending and revenue without growth-inhibiting tax raids”. He advocated for prioritising economic growth, suggesting the Chancellor should “scrap her fiscal rules to enable public and corporate investment and focus on recalibrating the economy onto a positive path to growth”.

The ONS data also showed that government borrowing for the 2024-25 fiscal year was revised down to £148.3bn from a previous estimate of £151.9bn. However, this revised figure remains £11bn above the OBR’s forecast of £137.3bn. The current budget deficit stood at £70.3bn in the fiscal year ending March 2025, which is £8.4bn more than the previous fiscal year and higher than the OBR’s £60.7bn forecast.