Government borrowing soared to £13.7 billion in August, representing a 44% annual increase.
It was the third-highest rate of August borrowing, which is determined by the difference between public sector spending and tax income, since records began.
Office of National Statistics’ chief economist Grantz Fitzner stated: “Central government tax receipts grew strongly, but this was outweighed by higher expenditure, largely driven by benefits uprating and higher spending on public services due to increased running costs and pay."
The ONS data shows that net debt as a percentage of gross domestic product has hit 100%, a level not seen since the early 1960s. In raw figures, public sector net debt excluding the Bank of England was £2.54 trillion.
The data is likely to fortify chancellor Rachel Reeves’ resolve to increase tax rates in the upcoming budget, which is due on 30 October.