Government borrowing hit £26.7 billion in July – £28.3 billion more than the same time last year, and the fourth-highest monthly figure since records began in 1993.
The new report means public sector debt is officially higher than gross domestic product (GDP) – the value of everything produced in the UK in a year.
It comes as the country plunges into the deepest recession on record after the economy shrank 20.4% from April to June.
Chancellor Rishi Sunak said the bleak milestone is a reminder that ‘difficult decisions’ will need to be made in the future in order to revive the UK economy.
He said: ‘This crisis has put the public finances under significant strain as we have seen a hit to our economy and taken action to support millions of jobs, businesses and livelihoods.
Without that support things would have been far worse.
‘Today’s figures are a stark reminder that we must return our public finances to a sustainable footing over time, which will require taking difficult decisions.
‘It is also why we are taking action now to support the growth and jobs which pay for our public services, by helping businesses to reopen safely and, through our Plan For Jobs, protecting, supporting and creating jobs to ensure that nobody is left without hope.’
The Office for National Statistics said: ‘The coronavirus pandemic has had an unprecedented impact on borrowing.