Ruth Mitchell

UK borrowing above expected in April says research

The UK reportedly notched up its worst April public sector net borrowing on record last month as tax receipts fell, the Office for National Statistics said.

Public borrowing, excluding financial interventions such as bank bail-outs, hit £10bn, compared with £7.3bn the previous year.

The ONS said tax receipts in April last year were boosted by a one-off bank payroll tax which raised £3.5bn.

April’s figure was higher than many analysts’ expectations of about £6.5bn.

Economists said the figures were a surprising disappointment.

“The public finances have got off to a pretty bad start this year,” said Hetal Mehta, at Daiwa Capital Markets. He warned that the position could worsen if economic growth was weaker than expected.

Samuel Tombs, at Capital Economics, told the national press he believed the government would struggle to meet its borrowing forecasts this year.

However, he added: “Nonetheless, these are just one set of figures and the trend in borrowing should improve as more of the spending cuts kick in later this year.”

The government hopes to bring deficit down to £122bn this financial year.

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