Finances out of control - Cameron

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Tory leader David Cameron has accused the government of "losing control of the nation's finances" as figures show public sector borrowing is soaring.

The Office for National Statistics revealed £16.1bn was borrowed in August - compared with £9.9bn in August 2008.

Downing Street says the figures are "broadly in line" with predictions and are less than the markets had expected.

It comes as Chancellor Alistair Darling begins talks with cabinet colleagues about possible spending cuts.

The latest ONS figures show UK public sector net borrowing reached £16.1bn last month - taking net borrowing to £65.3bn for the first five months of this financial year.

Budget forecasts

Government spending during August was £45.6bn - with an increase of £900m on unemployment benefits - while tax revenues slumped by 9.2% to £34.1bn.

The UK's overall net debt is £804.8bn - an increase of £172bn in a year, £140bn of was spent on banking sector bailouts.

The chancellor forecast in the Budget that it would reach a record £175bn by the end of this financial year - but some have predicted it will be higher.

Today's figures are in line with our Budget forecasts Treasury spokesman <a class="" href="/2/hi/uk_news/politics/8262168.stm">Cabinet discussing spending cuts</a> <a class="" href="/2/hi/business/8262434.stm">Public sector borrowing soaring</a> <a class="" href="/2/hi/uk_news/politics/8262514.stm">Where could spending cuts fall?</a>

Mr Cameron said: "We used to worry about borrowing £16bn in a whole year, but under this government we are borrowing it in a single month, they have completely lost control of the nation's finances."

A Treasury spokesman said the figures were in line with Budget forecasts.

"They reflect the impact of the global financial crisis on tax receipts as well as the action we are taking to support the economy right now and invest to benefit from the recovery."

Earlier it emerged that the chancellor has begun a series of one-to-one meetings with cabinet ministers, to identify priorities and areas of potential savings.

Vital services

It follows Gordon Brown's admission on Tuesday there would have to be some cuts in public spending in future, to rebalance the finances.

He said he would "cut costs, cut inefficiencies, cut unnecessary programmes and cut lower priority budgets" but would not support cuts in "vital front-line services".

The government has accused the Conservatives of planning swingeing 10% cuts across Whitehall departments but the Tories say Treasury papers leaked to them show the government was preparing 9.3% cuts between 2010 and 2014.

They're talking about cutting things that are unnecessary and wasteful - well if they're unnecessary and wasteful, why are they spending money on it at the moment? Vince CableLiberal Democrats <a class="" href="/2/hi/uk_news/politics/8262518.stm">Cable hints at need for tax rises</a> <a class="" href="/2/hi/uk_news/politics/8258999.stm">Q&A: Spending cuts</a>

Meanwhile Liberal Democrat Treasury spokesman, Vince Cable said the government had to work out how the budget deficit would be addressed in future years.

He told the BBC: "They have to have a plan and they haven't got one at the moment and all we've got is a grudging admission by Gordon Brown that there have to be cuts.

"And they're talking about cutting things that are unnecessary and wasteful - well if they're unnecessary and wasteful, why are they spending money on it at the moment?"

But he said the government was right not to start cutting spending now, while Britain was still in a recession.

"To rush in now with cuts in services, people losing their jobs would be disastrous, it would make the recession worse.

"What we have to have is a very clear plan as to how this whole process is going to be dealt with in the years ahead."

The Tories say the process of bringing down spending should start now and that a planned substantial increase in spending next year is unaffordable. But Mr Cameron has said he would protect NHS spending and also says he wants to protect front line services.