By Richard Johnstone | 20 December 2013
The Office for National Statistics has today revised up its public sector borrowing estimate for the financial year so far by £2.6bn, meaning the government’s deficit reduction plan only saved £1.9bn in the eight months to the end of November.
According to the latest ONS figures, net borrowing excluding the temporary effects of one-off transactions was £84bn so far in 2013/14. Borrowing for the month of November stood at £16.5bn, £900m higher than last year, according to the ONS.
Today’s updated figures showed underlying borrowing has only been cut ‘modestly’ in the year so far, the Office for Budget Responsibility said.
Analysing the year-to-date figures, the OBR said the revisions made the public finances look ‘less favourable than appeared last month’. By contrast, data for October indicated that year-to-date borrowing was down £5.8bn.
A £2bn reduction in tax receipts from initial estimates was the primary reason for the change, it stated.
Rowena Crawford, senior research economist at the Institute for Fiscal Studies, added the upwards revision could impact the OBR’s forecast at the Autumn Statement for 2013/14 borrowing to be £111.2bn, down £3.7bn on the year before.
‘Two weeks ago the Office for Budget Responsibility updated its forecasts to predict lower borrowing, lower spending and higher receipts than it had previously forecast in March.
‘A £2.6bn upward revision to estimated borrowing over the year so far means that borrowing is now estimated to have been higher than was thought last month. However, with four months of the financial year left much uncertainty remains, and the OBR’s forecast for borrowing this year may still prove to be correct.’
