Wednesday, January 22, 2020 - 04:34

MNI DATA IMPACT: UK YTD Borrowing Higher, Above OBR FY Goal

LONDON (MNI) - A burst of government spending has lifted year-to-date borrowing well above the full-year target, even ahead of a dose of government largesse expected in the March budget.

The following are the key points from public sector finance data published Wednesday by the Office for National Statistics.

- The UK's financial position has deteriorated markedly in the current financial year, courtesy of 5.0% surge in government spending on goods and services, the biggest year-to-date increase since records began in 1997.

- Borrowing has increased by 7.9% over the first nine months of the fiscal year to GBP54.6 billion, far exceeding the Office for Budget Responsibility target of GBP47.6 billion.

- The OBR's target could rise further in months to come, as the updated December estimate largely reflects the addition of student loans to the government's borrowing position, but does not account for slowing growth or promises of increased government spending.

- December borrowing fell modestly to GBP4.765 billion from GBP4.981 billion in 2018, taking debt as a proportion of GDP to 73.0% from 73.1% a year earlier.

- Corporate tax receipts continued to disappoint, in line with stagnating business investment, declining by 3.4% in the first nine months of the fiscal year, the biggest fall since 2012.

- Value Added Tax receipts weakened markedly over the same period of 2018, rising by just 2.9% between April and December, the smallest increase since 2012. However, VAT takings rose by an exceptionally-high 6.0% in 2018, making for a challenging comparison in 2019.

- The Bank of England saw a GBP4.6 billion early repayment against the Term Funding scheme in December, with the total outstanding and added to the total Public Sector Net Debt now GBP108.2 billion.

-London bureau: 44 (0) 203 865 3812; email:


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