- Howard Archer, IHS Global Insight
Public finances in Britain improved in October, with borrowing excluding banks falling to 7.7 billion pounds, according to the Office for National Statistics. Net borrowing excluding banks for October was 2.4% lower compared with the same period last year after an increase in stamp duty receipts, which have soared 3.6% to 1.3 billion pounds and a rise in income tax related payments. The biggest jump was seen in VAT receipts, which advanced by 4.9% to 10.3 billion pounds. In the central government receipts have risen 12% compared with last year. Central government expenditure is still rising, reaching 57.3 billion in October, a rise of 2.9% compared with the same month last year. Interest and dividends rise by 4.7 billion pounds; largely due to an Asset Purchase Facility transfer to central government. Public sector net borrowing excluding banks for the financial year to date is 64.1 billion pounds, an increase of 3.7 billion pounds or 6.1% compared with the 2013/14 financial year.
With five months before the end of the fiscal year, borrowing now stands at 64.1 billion pounds, while the Office for Budget Responsibility's expects a target of 86.6 billion pounds for the full fiscal year. The OBR's Economic and Fiscal Outlook had estimated a decline in borrowing of over 12 billion pounds between 2013-14 and 2014-15. The OBR said that higher borrowing so far this year primarily indicated the fact that receipts growth was much weaker than expected.
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