Search Share Prices
Government borrowing set to undershoot OBR forecast
Government borrowing is on course to undershoot the official forecast for the full year, official figures suggest.
Public sector net borrowing fell by £2.5bn to £41.4bn in the financial year to the end of February from a year earlier, the Office for National Statistics reported. The ONS said the figure, which excludes public sector banks, was the lowest year-to-date net borrowing since February 2008.
The Office for Budget Responsibility reduced its forecast for borrowing in the current financial year to £45.2bn from £49.9bn at the 13 March Spring Statement. With a month left of the financial year the annual total now looks like it will be less than the OBR predicted.
Ruth Gregory, UK economist at Capital Economics, said: "February's public finances figures were fairly encouraging ... An extrapolation of the current trend suggests that borrowing is on course to undershoot the OBR's (recently downwardly revised) forecast, perhaps by £2bn or so."
The public finances have improved in recent months as the Treasury has benefited from bigger than expected tax receipts. But analysts have said the UK is on course for further difficult economic times with little scope for significant easing of austerity measures under Chancellor Philip Hammond's plans.
Public sector net debt rose by £68.1bn to £1.763 trillion, or 85.1% of GDP, at the end of February. The OBR estimates debt as a share of output will start to fall in 2018-19.