The total net borrowing by the UK's public sector totalled £16bn last month, according to figurers released by the Office for National Statistics (ONS).

This is a large rise from the same figure in August last year, which was just under £10bn, and this increase takes net borrowing for the five months of the financial year to £65bn.

"The scale of the challenge facing the country is huge, and we must have a credible multi-year plan to cut the deficit without damaging wealth-creating businesses. While painful choices are unavoidable, unless the business sector is nurtured and encouraged to take the economy out of recession, the country will face serious risks of further declines," said David Kern, Chief Economist at the British Chambers of Commerce.

Chancellor Alistair Darling has forecast that public sector net borrowing will reach a record £175bn this year.