Britain’s soaring benefits bill drove up public borrowing to its highest May level outside of lockdown, official figures show, pushing the UK’s debt share above the size of the economy for the first time since 1961.

The Government borrowed £20bn to plug the gap between tax receipts and public spending in May.

This is more than double the £9.4bn borrowed in the same month a year ago, according to the Office for National Statistics (ONS).

It is also the second highest May borrowing since monthly records began in 1993, only behind the first Covid lockdown in May 2020.

The UK’s total debt mountain is now 100.1pc of gross domestic product (GDP) exceeding 100pc for the first time since March 1961.

While Grant Fizner, the ONS’s chief economist, said the figure was provisional and was likely to be revised in future months, it means total debt is now more than the annual output of the UK economy.

The ONS blamed the rise in borrowing on increases in benefit payments, including the state pension, universal credit and child benefit, which all climbed by 10.1pc in April to match increases in the cost of living. Net social benefits were £22.9bn, £2.9bn higher than a year ago.

“This increase was largely because of inflation-linked benefits uprating,” the ONS said.

Debt was also pushed up by a £9.8bn payment from the Treasury to the Bank of England to cover losses on its massive bond buying programme as interest rates have climbed.

Borrowing so far this year is currently estimated to be £2.1bn higher than the £40.8bn forecast by the Office for Budget Responsibility (OBR), the Government’s tax and spending watchdog.

However, borrowing for the previous financial year is currently £18.3bn less than the OBR predicted in March.

Debt interest stood at £7.7bn in May. Economists said the recent jump in gilt yields suggested the Government’s bill to service its debts will continue to soar.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, believes the rapid rise in UK borrowing costs will leave “no scope for pre-election tax cuts” if current forecasts for interest rates to hit 5.75pc are borne out.

He estimates the OBR will be forced to raise its forecast for interest payments by almost £40bn in 2024/25 alone if it republished estimates based on current bond yields and interest rate expectations. 

With an election pencilled in for next year, Mr Tombs said: “It is looking ever more likely that the Conservatives will have to go into the next general election, which must be held by January 2025, merely with the promise of lower taxes to come, rather than with pre-election bribes.”