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UK National Debt

The UK government owes more than the entire economy produces in a year. This page tracks public sector net debt, the annual deficit, and what the borrowing numbers mean for gilt markets, interest rates, and your taxes.

Data as of 2 Apr 2026, 13:08

£2.88TPublic sector net debt (2026 FEB)
93.1%Debt-to-GDP ratio (2026 FEB)
£-14.3bnMonthly net borrowing (2026 FEB)
4.86%10-year gilt yield (borrowing cost)

Total Public Sector Net Debt

Public sector net debt measures the government's total outstanding liabilities minus its liquid financial assets. It has grown sharply since the 2008 financial crisis and the COVID-19 pandemic, both of which required enormous fiscal responses.

Source: ONS (HF6W). Updated at build time.

Debt-to-GDP Ratio

Raw debt figures are less useful without context. The debt-to-GDP ratio measures how large the debt is relative to the size of the economy. A ratio above 100% means the government owes more than the country produces in a year. The UK crossed this threshold during the pandemic.

Source: ONS (HF6X). Updated at build time.

Monthly Government Borrowing

Net borrowing is the monthly gap between what the government spends and what it collects in taxes. Positive figures mean the government borrowed that month. The deficit tends to be seasonal — larger in some months than others due to the timing of tax receipts and spending.

Source: ONS (J5II). Updated at build time.

How UK Government Debt Works

Government borrowing is more complex than a household credit card. The mechanics of how debt is issued, who buys it, and what it costs matter for interest rates, gilt prices, and ultimately your mortgage and savings returns.

Gilt Issuance

The Debt Management Office (DMO) funds the deficit by selling gilts — government bonds. Regular auctions for conventional and index-linked gilts attract bids from primary dealers (large banks). When the government needs to borrow more, gilt supply rises, which can push yields higher.

How gilts work →

Interest Costs

Servicing the debt costs tens of billions per year in interest payments. The cost depends on gilt yields at the time of issuance and on RPI inflation (which affects index-linked gilts). When BoE rates and gilt yields rose sharply in 2022–23, debt interest costs surged, squeezing spending on other public services.

Who Holds UK Debt

UK pension funds and insurance companies are the largest domestic holders — they need long-dated gilts to match their liabilities. Overseas investors (sovereign wealth funds, foreign central banks) hold roughly a quarter. The Bank of England accumulated a large holding through QE, now being reduced via quantitative tightening.

Fiscal Rules

The Chancellor sets fiscal rules to constrain borrowing — typically targeting debt-to-GDP falling within 5 years and day-to-day spending balanced by tax revenues. These rules influence Budget decisions on tax and spending, and markets watch closely for any sign the rules might be breached.

UK tax system overview →

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Frequently Asked Questions

How much is the UK national debt?

UK public sector net debt stands at approximately £2.88 trillion according to the ONS. This figure represents total government borrowing accumulated over decades, minus liquid financial assets. It includes debt issued as gilts, Treasury bills, and National Savings products.

What is the UK debt-to-GDP ratio?

The debt-to-GDP ratio compares total public sector net debt to the size of the economy. It currently stands at approximately 93.1%. A higher ratio means the government has more debt relative to its ability to generate revenue through taxation. For context, the ratio was around 35% before the 2008 financial crisis.

What is the difference between debt and deficit?

The debt is the total stock — everything the government has borrowed over time and not yet repaid. The deficitis the annual flow — how much more the government spends than it receives in taxes each year. A deficit adds to the debt. Even when politicians talk about “cutting the deficit”, the debt continues to grow as long as the government is still borrowing (deficit is positive).

How does UK debt compare internationally?

The UK's debt-to-GDP ratio is moderate compared to advanced economies. Japan exceeds 250%, Italy is around 140%, the US is above 120%. France and Canada are similar to the UK. Germany is lower at around 65%. What matters more than the absolute level is the trajectory, the cost of servicing it (gilt yields), and the government's fiscal credibility with bond markets.

Does national debt affect mortgage rates?

Indirectly, yes. Higher government borrowing means more gilt issuance, which can push gilt yields up. Since fixed-rate mortgages are priced off swap rates (which track gilt yields), increased borrowing can lead to higher mortgage rates. The September 2022 mini-Budget was a dramatic example: markets lost confidence in fiscal discipline, gilt yields spiked, and mortgage rates jumped within days. See how gilts affect mortgage rates.

Debt and borrowing data is sourced from the Office for National Statistics (ONS) public sector finances bulletin and updated at build time. Figures are subject to revision by the ONS. This page does not constitute financial advice. GiltEdge is not regulated by the FCA.