A rise in local authority borrowing pushed up the government deficit by £9.3bn last month, but left George Osborne's deficit reduction plan on track, according to official figures.
The Office for National Statistics said that for the first 11 months of the 2013/14 financial year borrowing was down £4.4bn on the same months last year to £99.3bn.
Coming days after the chancellor said the public finances would be in surplus by 2018-19, the latest monthly data showed the Treasury remains on course to hit its borrowing target of £107.8bn when the financial year ends in April.
Osborne said better than expected growth in the next couple of years would close the public spending deficit – the difference between tax income and government spending – at a faster rate than predicted last year.
Howard Archer, chief UK economist at IHS Global Insight, said the figures represented mixed news for George Osborne.
He said the underlying improvement in February was undermined by comparison with February 2013, when the shortfall was limited by a £2.3bn transfer from the sale of 4G mobile phone licences.
"To meet his revised PSNBR [public sector net borrowing requirement] target of £107.8bn in 2013-14, the chancellor now needs the shortfall to come in at £8.5bn in March.This may prove difficult to achieve, given that there was a deficit of £11.4bn in March 2013," he said."
"If the chancellor immediately just misses his newly set targets for 2013-14, it could increase scepticism that the chancellor will achieve his fiscal targets further out. The latest public finances highlight the fact that there is still an awfully long way to go in getting the public finances into decent shape."
Analysts dismissed the rise in council borrowing, saying it was a figure that would normally be spread over several months, but said concerns remained that cuts in public sector spending relied on cuts in vital services to support the deficit reduction strategy.
Jonathan Loynes, chief European economist at Capital Economics, said it was worrying that tax receipts were still not responding to the economic recovery as positively as might have been hoped.
theguardian.com
The Office for National Statistics said that for the first 11 months of the 2013/14 financial year borrowing was down £4.4bn on the same months last year to £99.3bn.
Coming days after the chancellor said the public finances would be in surplus by 2018-19, the latest monthly data showed the Treasury remains on course to hit its borrowing target of £107.8bn when the financial year ends in April.
Osborne said better than expected growth in the next couple of years would close the public spending deficit – the difference between tax income and government spending – at a faster rate than predicted last year.
Howard Archer, chief UK economist at IHS Global Insight, said the figures represented mixed news for George Osborne.
He said the underlying improvement in February was undermined by comparison with February 2013, when the shortfall was limited by a £2.3bn transfer from the sale of 4G mobile phone licences.
"To meet his revised PSNBR [public sector net borrowing requirement] target of £107.8bn in 2013-14, the chancellor now needs the shortfall to come in at £8.5bn in March.This may prove difficult to achieve, given that there was a deficit of £11.4bn in March 2013," he said."
"If the chancellor immediately just misses his newly set targets for 2013-14, it could increase scepticism that the chancellor will achieve his fiscal targets further out. The latest public finances highlight the fact that there is still an awfully long way to go in getting the public finances into decent shape."
Analysts dismissed the rise in council borrowing, saying it was a figure that would normally be spread over several months, but said concerns remained that cuts in public sector spending relied on cuts in vital services to support the deficit reduction strategy.
Jonathan Loynes, chief European economist at Capital Economics, said it was worrying that tax receipts were still not responding to the economic recovery as positively as might have been hoped.
theguardian.com
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