UK government borrowing fell last month, official figures showed today, in a sign that the Chancellor's austerity measures are increasingly taking hold.

Public sector net borrowing, excluding financial interventions, was £12.8 billion sterling in September, compared with a revised £13.5 billion the same month last year.

It was the lowest level of borrowing for a September since 2008.

The improvement was partly driven by a 4.5% fall in central government net investment to £2.4 billion, which includes the purchase and sale of assets such as buildings and vehicles.

The figures came as experts warned that the underlying health of the public finances will remain problematic for George Osborne despite the better picture in September.

The UK government is in the middle of a multi-year deficit reduction programme, and is enacting spending cuts and tax increases.

But the austerity programme has hit the British economy, which has shrunk for three quarters in a row. Figures next week are expected to show the recession ended in the third quarter of 2012.