There really is no good news for Rachel Reeves as she prepares her second Budget. This morning’s borrowing figures are not just bad; they hint at a sense of hopelessness, that Britain is sliding inexorably towards a very deep fiscal crisis.

This is yet another fiscal black hole for Reeves to fill, along with another about to be created by the OBR

In August, the government had to borrow £18 billion, £3.5 billion more than in August 2024. This is in spite of £40 billion worth of tax rises (or rather tax rises which were hoped to raise an extra £40 billion) in last year’s Budget. Government receipts are indeed up over the past year, £4.8 billion higher than they were in August 2024. Trouble is that spending was £8.4 billion higher than in August 2024, thanks in part to higher public sector

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