Rachel Reeves has achieved a record-breaking borrowing reprieve, as new data precedes the Chancellor’s upcoming Spring Statement in March. The Treasury reported a £30.4bn surplus in January, according to the latest figures from the Office for National Statistics (ONS), following a surge in tax receipts. This figure is £15.9m higher than January 2025 and £6.3bn above the Office for Budget Responsibility’s (OBR) November 2025 forecast.
Capital gains tax receipts reached their highest January on record, with total receipts increasing by £7bn to £17bn, suggesting fears over future tax hikes may have prompted a significant asset sell-off. “January – traditionally a strong month for self-assessed tax receipts – saw the highest surplus since monthly records began,” commented Grant Fitzner, chief economist at the ONS.
Borrowing for the financial year up to January 2026 stood at £112.1m, approximately 11.5% lower than the same period last year, though it remains the fifth-highest April to January borrowing run on record. Meanwhile, total public sector spending increased by £900m from January 2025 to £112.7bn, primarily attributed to a decrease in interest payable on central government debt.
At the end of 2025, total borrowing costs for the financial year had exceeded £140.4bn, surpassing the OBR’s forecast of £138.3bn, despite December’s borrowing figures falling short of City analysts’ estimates.
The Chancellor will present her Spring Statement on 3 March 2026, with reports indicating the Treasury aims to downplay the event to avoid disrupting bond markets and increasing borrowing costs.
