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Government borrowing undershoots official forecast
(WebFG News) - Government borrowing was £2.6bn lower than the official forecast in the last financial year as the total fell to the lowest since before the financial crisis.
Public sector net borrowing fell £3.5bn in the year to the end of March to £42.6bn, the Office for National Statistics reported. The figure for annual borrowing, excluding public sector banks, was the lowest since the year that ended in March 2007.
At Chancellor Philip Hammond's spring statement in March the Office for Budget Responsibility forecast net public borrowing of £45.2bn - less than its earlier estimate of £49.9bn.
Economists were expecting borrowing to undershoot the OBR's revised forecast after the Treasury benefited from bigger than expected tax receipts. But the government remains constrained by its own austerity plans and the slowing economy.
Ruth Gregory, UK economist at Capital Economics, said: "As expected, March's public finances figures showed that borrowing has come in below the OBR's forecast. Given the time lags involved, the apparent slowing in the economy so far in 2018 will probably have some adverse impact on the public finances in the coming months. But we expect this slowdown to be temporary so it should not knock the fiscal improvement off course."