–May PSNB Stg16.023bn vs Stg17.421bn in May 09; median Stg18bn
–May PSNCR Stg11.963bn vs Stg19.13bn in May 09; median Stg20bn
LONDON (MNI) – Public Sector Net Borrowing eased in May compared to
a year earlier, suggesting that the worst could be over for the public
finances, according to figures released by National Statistics Friday.
Public sector borrowing stood at Stg16 billion in May, down from
Stg17.4 billion in the same month a year earlier. The outturn was also
below the median forecast of Stg18 billion.
The current budget posted a deficit of Stg14.1 billion, down from
Stg15.7 billion in May 2009.
For the first two months of the financial year net borrowing stood
at Stg24.3 billion, down on the Stg26.2 billion seen during the same
period last year.
While the data sugest the deterioration in the public finances may
have finally ended, borrowing remains at high levels. The new Office for
Budget Responsibility forecast earlier this week that net borrowing
would hit Stg155 billion in 2010/11 before easing a little to Stg134
billion in 2011/12.
In his emergency Budget, scheduled to take place on Tuesday, George
Osborne is expected to announce swingeing cuts in public spending
coupled with tax rises, in an attempt to cut the budget deficit. Most
pundits believe that the impact this financial year may be muted with
most of the pain being felt in 2011/12.
The Public Sector Net Cash Requirement stood at Stg11.963 billion
in May, down from Stg19.13 billion in May 2009, significantly below the
median forecast of Stg20 billion.
As a percentage of GDP, net debt rose to 62.2% in May, up from
55.4% in the same month a year earlier.
–London bureau: email: drobinson@marketnews.com
[TOPICS: MT$$$$,M$B$$$,MABDS$]
