UK public sector net borrowing (excluding public sector banks) widened to GBP 24.3 billion in April 2026 from GBP 19.5 billion a year earlier, above market expectations of GBP 20.9 billion. It was the second-highest April borrowing on record, underlining pressure on the public finances. The reading contrasts with March forecasts that borrowing would fall to 3.6% of GDP in the 2026/27 tax year, its lowest level since before the COVID-19 era. However, the war involving Iran has increased the risk of an economic slowdown, threatening tax revenues while adding pressure on Chancellor Rachel Reeves to support households and businesses facing higher energy costs. Public sector spending rose by GBP 7.6 billion, driven by higher welfare costs, increased investment, public service spending, and record April debt interest payments. Meanwhile, public sector receipts increased by GBP 2.7 billion. Public sector net debt stood at 94.2% of GDP at the end of April, up 0.5 percentage points from a year earlier.