# Government borrowing falls sharply as national insurance hike boosts coffers

By Derren Nathan — 2026-01-22

Derren Nathan, head of equity analysis at Hargreaves Lansdown, said: “Rachel Reeves’ policy of fiscal tightening looks to be having the desired effect on the public purse as December’s public borrowing came in below market forecasts of £13 billion at £11.6 billion, the lowest December drawdown since 2019.

“However, it’s unlikely to signal a spending spree with borrowing for the year still above Treasury forecasts.

“That said, it’s likely to be taken as a positive signal for government borrowing costs and interest rate expectations, adding to the positivity on London markets, which are close to record highs.”

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