A big increase in Government borrowing was revealed today as Theresa May promised pay rises totalling £2 billion for teachers, police officers and other public sector staff.
Public sector net borrowing jumped sharply in June because of higher debt interest payments and rising spending on services, said the Office for National Statistics.
It totalled £7.2 billion, up from £3.3 billion in June 2018, the highest June amount since 2015.
Figures showed the Government took in £800 million more in tax and National Insurance contributions than a year previously, but this was swallowed as debt repayments rose by £2.1 billion.
The Treasury will unveil the biggest public sector pay rise for six years on Monday. Two million workers will receive above-inflation salary increases, the paper said, amid concerns the private sector is pushing ahead on pay.
Police officers are set to receive a 2.5 per cent pay rise, soldiers a 2.9 per cent increase and teachers and other school staff 2.75 per cent, while dentists and consultants will get 2.5 per cent and senior civil servants 2 per cent.
The rises do not apply to other public sector staff, such as more junior civil servants and nurses, whose pay is dealt with separately, The Times added.
The Treasury is expected to say that, barring some extra funding for schools, the money will have to come from existing budgets.
Public sector pay rises were capped at 1 per cent in 2010, but the cap was scrapped last year.