Public sector net borrowing was in surplus for the first time since 2002 in July, driven by higher self-assessment tax receipts.

The figure was in surplus by £200 million last month, with VAT also helping to boost the figure.

According to the Office for National Statistics, for the year to date public sector borrowing is up by £1.9 billion to £22.8 billion. The Office for Budget Responsibility is forecasting that public sector net borrowing will increase to £58.3 billion during the financial year to March 2018.

Ruth Gregory, UK economist at Capital Economics, says that July’s public sector finance figures “will probably prove to be just a temporary blip”.

“As such, despite July’s strength the Chancellor may still find that he has little scope for any easing back on the planned fiscal squeeze in his November Budget,” she added.