Record public sector surplus in January, says ONS

21 Feb 19

The public sector ran a £15bn surplus in January – the biggest on record for that month – as a result of strong taxes coming in, official figures have revealed.

This was a £5.6bn greater surplus than in January the previous year, the Office for National Statistics said today, in its monthly data.

Central government revenues overall were 10% higher than the same month last year, driven by self-assessment and capital gains tax receipts, which were 17% higher than last January.

Borrowing in the current financial year to date was £21.2bn - £18.5bn less than the same period last year, the ONS said.

Public sector debt at the end of last month was £1,78bn – 82.6% of GDP. This is an increase of £40.5bn on January 2018.

This is the final set of monthly data from the ONS before the chancellor’s Spring Statement, which is scheduled for 13 March.

In response to the figures, the Institute for Fiscal Studies said the strong public finance figures were “good news” but “a deteriorating outlook could still make for tricky fiscal arithmetic” in the March statement.

Thomas Pope, research economist at the IFS, said: “If the government’s official forecasts follow suit that alone could add around £5bn to the deficit in the medium-term.

“Even in spite of today’s good news, therefore, there could be tricky fiscal arithmetic for the chancellor as he considers how best to respond to uncertainty around Brexit and how much money to make available to departments at this year’s Spending Review.”

This comes after the Bank of England earlier this month downgraded its growth forecast for 2019 by half a percentage point, reducing the expected size of the economy this year by as much as £10bn.

The deficit for 2017-18 was £42bn.

Did you enjoy this article?