- Robert Wood, chief economist at Berenberg bank
Britain's government borrowing increased more than expected in September amid a surge in central government borrowing and precipitous decline in interest and dividends receipts, challenging Finance Minister George Osborne to meet his full-year borrowing targets. Net borrowing excluding public-sector banks stood at 58 billion pounds between April and September compared with 52.6 billion pounds a year earlier, the Office for National Statistics said. Borrowing for September alone was 15.3% higher than in the previous year at 11.8 billion pounds. That compared with economists expectations for it to hold around 10.5 billion pounds. The government said that the extra borrowing so far this year is due to an uneven pattern of tax receipts in 2013, and that the differences would even out before the end of the financial year. The underperformance so far largely reflects smaller-than-expected income-tax receipts, as many of jobs being created were not bringing the expected increase in income tax revenues. Data showed that revenue from income tax and employment insurance contributions in September was 2.3% higher than a year ago, while for the year to date it was up by just 0.5%.
In March, government forecasters predicted the budget deficit would shrink by about 12 billion pounds in the current fiscal year.
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