UK public finances have worst year since World War Two
Britain's public finances came in slightly better than economists had expected in March, but official figures on Wednesday still confirmed the 2009/10 fiscal year as the worst since records began after World War Two.world Updated: Apr 22, 2010 14:26 IST
Britain's public finances came in slightly better than economists had expected in March, but official figures on Wednesday still confirmed the 2009/10 fiscal year as the worst since records began after World War Two.
The Office for National Statistics said public sector net borrowing in March rose to 23.498 billion pounds from 20.060 billion pounds in March last year, in what is typically a heavy-spending month as civil servants rush to use up funds before the end of the fiscal year.
This was the highest monthly borrowing for March) since records began in 1993, and just below private-sector economists' consensus forecast of 24 billion pounds.
For the fiscal year as a whole, borrowing totalled a record 152.842 billion pounds ($236.2 billion), equivalent to 10.87 per cent of GDP, and up from 86.913 billion pounds in 2008/09.
The deterioration in Britain's public finances since the start of the financial crisis has been a key point of contention in the political campaign ahead of a May 6 national election.
Labour finance minister Alistair Darling has argued that the spending was necessary to avoid an even deeper recession, while the Conservative opposition has warned it has pushed Britain dangerously close to a downgrade of its triple-A debt rating.
In his 2010 budget in March, Darling forecast that public-sector net borrowing excluding the cost of interventions to support the financial sector would hit 166.5 billion pounds in 2009/10, equivalent to 11.8 per cent of GDP.
The Office for National Statistics said this measure of PSNB came in at 163.4 billion pounds for the fiscal year, equivalent to 11.6 per cent of GDP.
The alternative public-sector net cash requirement measure of borrowing, which measures immediate government funding needs, showed borrowing of 25.752 billion pounds in March, down from the record 28.359 billion pounds a year ago.
This was well below economists' forecasts of 32 billion pounds.
For the fiscal year, PSNCR totalled 134.338 billion pounds, up from 59.561 billion in the 2008/09 fiscal year, and the highest since records began in 1963/64.
The ONS also released March retail sales figures at the same time, which showed that Britain's tentative economic recovery remained on track.
Retail sales volumes rose by 0.4 per cent in March versus 2.5 per cent in February, giving an annual increase of 2.2 per cent. Economists had forecast a monthly rise of 0.6 per cent and a year-on-year gain of 2.4 per cent.