By Jonathan Davies

The government increased public sector borrowing by £700m to £11.6bn in August, according to the Office for National Statistics (ONS).

The ONS said August figures put a dent in the Chancellor George Osborne's plans to cut the deficit. The total public sector borrowing for the year so far, since April, stands at £45.5bn, 6.2% higher than at the same point last year.

However, it is difficult to compare as the ONS has changed its methodology.

The ONS said one of a main reasons for the increase in public sector borrowing is Network Rail becoming re-nationalised. When the government moved Network Rail from the private sector to the public sector, it took on its debt.

The Treasury is yet to release any specific figures for Network Rail, but said: "the reclassification of Network Rail adds £1bn to £2bn onto borrowing in most years and £4.6bn in 2013/14."

The ONS also revealed the budget deficit - the difference between tax receipts and the amount the government has to borrow to fund public services. It was £9.4bn in August, £100m lower than a year ago and £36.4bn for the financial year so far, £200m lower than this time last year.

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