Chancellor George Osborne's deficit-busting plans were dealt a blow yesterday as the last borrowing figures before his Autumn Statement revealed further pressure on the public finances.
Public sector net borrowing, excluding financial interventions such as bank bailouts, was £8.6 billion in October, up £2.7bn on the same month last year.
The Chancellor wants to record borrowing for the full year 2012/2013 of £120bn, compared with £121.4bn in the previous year, but this is looking unlikely.
Mr Osborne is expected to announce in his Autumn Statement in December the UK Government will be unable to start bringing down debt as a percentage of GDP in 2015/16.
The chances of the Chancellor altering the debt target were heightened after Bank of England governor Sir Mervyn King effectively endorsed such a move if the global economy was growing slowly.
If Mr Osborne sticks to the debt target, he will be faced with the unpopular decision of announcing potentially large tax rises and further spending cuts in December.
Public sector borrowing for the year to date is £73.3bn, excluding a one-off £28bn boost from the transfer of the Royal Mail pension fund into Treasury ownership, which is £5bn higher than last year.
Within the October figures, the picture was much the same as previous months, with Government spending outstripping tax receipts.
Total tax receipts were 1.8% higher at £47.5bn in October, while total expenditure rose 7.4% to £52.8bn.
A Treasury spokesman said: "The economy is healing, but it still faces many challenges. These numbers illustrate that, but show the Government's plans to bring spending under control are on track."
Downing Street said lower receipts reflected the "global economic position" and downward revisions to growth prospects.
Labour Treasury spokeswoman Rachel Reeves said: "George Osborne is borrowing billions more to pay for the cost of his economic failure. Having failed on jobs and growth, the Government is now failing on the deficit too.
"By squeezing families and businesses too hard, choking off the recovery and so pushing borrowing up not down, the Government's economic plan has completely backfired."
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