UK government debt rose to over £1 trillion for the first time in December, despite a fall in public sector borrowing.
Excluding bank bailouts and other financial interventions, public sector borrowing fell £2.2 billion to £13.7 billion in December according to the latest figures from the Office for National Statistics.
This was lower than City forecasts of £14.9 billion.
However, net debt increased from £883 billion in 2010 to £1,003.9 billion in 2011, representing 64.2 per cent of GDP.
The government has reduced borrowing by increasing taxes and cutting spending, with December representing the fourth consecutive month when borrowing has declined.
On average borrowing has fallen by around 5 per cent year on year over the past four months, compared with an average increase of nearly 7 per cent in the 10 years to the 2010-11 financial year, according to George Buckley, an economist at Deutsche Bank.