UK borrowing falls by almost 50% as pandemic spending eases By Reuters
2021-12-21 16:30:10
more 
598
UK borrowing falls by almost 50% as pandemic spending eases © Reuters. British pound coins are seen in front of displayed stock graph in this illustration taken, November 9, 2021. REUTERS/Dado Ruvic/Illustration

By William Schomberg

LONDON (Reuters) -British public borrowing nearly halved in the first eight months of the 2021/22 financial year compared with a year earlier when finance minister Rishi Sunak was deep in his emergency pandemic spending programme.

Borrowing between April and November fell to 136 billion pounds ($180 billion), down by almost 116 billion pounds in the same period of 2020, the Office for National Statistics said.

But the figure was still almost three times its level two years earlier, before the pandemic, and Sunak is under pressure to come up with fresh support for the hospitality industry and other sectors hit hardest by a new jump in COVID-19 cases.

Media have reported that Sunak was opposed to new social-distancing rules to slow the spread of the Omicron coronavirus variant. Prime Minister Boris Johnson said on Monday he was not changing the rules, for now.

Bethany Beckett, an economist with Capital Economics, said Tuesday's data almost seemed like old news as Omicron made another tightening of the rules a possibility.

"Although the economy has got better at coping with restrictions with each new wave, we still suspect it would prompt a deterioration in the public finances via lower tax revenues and the potential reintroduction of government support schemes," she said.

Public sector net borrowing for November alone, excluding state banks, totalled 17.4 billion pounds, more than the average forecast of 16 billion pounds in a Reuters poll of economists.

Borrowing in October was revised down to 12.4 billion pounds from a previously reported 18.8 billion pounds, official data showed.

Britain racked up its biggest budget deficit since World War Two, equivalent to 15% of gross domestic product, in the 2020/21 financial year.

But it is falling this year as the government scales back its emergency economic support, including its furlough jobs support programme which expired at the end of September, and tax revenues pick up along with the economy.

Tuesday's data showed total government receipts were up almost 15% in the April-November period.

But rising inflation is adding to the borrowing bill. Interest paid by the government, most of it from inflation-linked bonds, jumped by 54% to almost 43 billion pounds.

A recent acceleration of inflation in October and November had not yet impacted the interest costs, ONS officials said.

Public sector net debt totalled 2.318 trillion pounds, equivalent to 96.1% of gross domestic product and up by more than 500 billion pounds since the start of the pandemic.

($1 = 0.7565 pounds)

Statement:
The content of this article does not represent the views of fxgecko website. The content is for reference only and does not constitute investment suggestions. Investment is risky, so you should be careful in your choice! If it involves content, copyright and other issues, please contact us and we will make adjustments at the first time!

Related News

您正在访问的是FxGecko网站。 FxGecko互联网及其移动端产品是中国香港特别行政区成立的Hitorank Co.,LIMITED旗下运营和管理的一款面向全球发行的企业资讯査询工具。

您的IP为 中国大陆地区,抱歉的通知您,不能为您提供查询服务,还请谅解。请遵守当地地法律。