GDP rises by almost 4%

Debt as a percentage of gross domestic product (GDP) - a broad measure for the total economy - hit 65% in May, up from 61.3% last year.

April's borrowing figures were flattered by a one-off £28 billion lift from the value of assets transferred from the Royal Mail pension plan.

But excluding this one-off impact, total borrowing for the current financial year stands at £28.4 billion.

Earlier this month, the Chancellor and Governor of the Bank of England Sir Mervyn King unveiled a multibillion-pound lending scheme to stimulate economic growth - but ministers insisted the move was not a "Plan B".

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Public borrowing hits £17.9bn

The Chancellor's plans to tackle to deficit have come under pressure after figures revealed a larger-than-expected surge in government borrowing. Public sector net borrowing was £17.9 billion in May, up from £15.2 billion the previous year.