Britain's budget deficit increased more than initially was expected in February on the back of higher government spending, that accelerated at the fastest pace in almost a year. A report from the ONS showed expenditure exceeded budget revenue by 9.3 billion pounds, rising from 9.2 billion a year ago and outpacing markets' estimations for a 8.6 billion gap. While the nation's government is less that half way toward reaching a balanced budget, George Osborne pointed out during his March 19 budget release that austerity measures will be in place for another five years even despite broadening economic improvement.
Moreover, analysts are staring to make their bets on whether the government will be able to meet its new, tougher estimate from the Office for Budget Responsibility. Figures showed that borrowing during the 11 months of the tax year hit 99.3 billion pounds– a 4.3% less than in the same period a year earlier. This figure is a massive burden on the nation's public finances. Some economists suggested the U.K. government will be able to reduce the deficit to 5.5% of GDP in 2015, given the signs domestic economy will post a growth around 3%. Nonetheless, the bigger picture shows that it is still a very long way to go before Britain's public sector will heal up its finances.
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