The Office for National Statistics have revealed that during March, public sector net borrowing, excluding interventions such as bank bail-outs, came in at £18.2 billion. However, because previous months' borrowing had been revised down, the government still met its target of £126 billion for the year.
The borrowing from the government during the last year was down from £136.8 billion the previous year – which was significantly helped by downward revisions in the previous 11 months.
A Treasury spokesperson said: "Today's data shows that the forecast for 2011/12 is on track, with public borrowing down by £11 billion compared to the previous year.”
Economists believe the government will have a tougher task meeting forecasts to reduce borrowing to £120 billion during the current financial year; mainly as a result of the economy still struggling and unemployment rising; which is expected to hurt tax revenues and increase benefit payments.
Despite the forecast for the next twelve months being gloomy, the government is aiming to eliminate the deficit by 2016 / 2017; with the Treasury spokesperson adding: "This shows that the government's plan to reduce the budget deficit is working."
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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