Public borrowing tumbles as Forex bank fines boost UK Treasury coffers
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Public borrowing tumbles as Forex bank fines boost UK Treasury coffers
Public borrowing tumbled last month as income tax receipts grew and bank fines helped boost Treasury coffers. The Office for National Statistics (ONS) said public sector net borrowing, excluding state-controlled banks, fell to £14.1bn in November, down 10%, or £1.6bn, on the same month last year. It said the Government's finances were boosted by the £1.1bn in fines imposed on HSBC, Royal Bank of Scotland, Citi, JP Morgan and UBS last month for the manipulation of foreign exchange markets. That total is on course to rise, given comments by the chief executive of Barclays that the £500m it has set aside to cover its own looming settlement will not be sufficient .
It is encouraging that today’s figures show borrowing for the month is lower than last year, due to stronger receipts.
Treasury spokesman
The borrowing figure for November meant the total amount borrowed during the first eight months of the financial year was £75.8bn - £500m lower than was achieved in the same period in 2013. It marked the first time in 2014/15 that the year-to-date public finances have been in better shape than the same period a year before. The Chancellor admitted during his Autumn Statement to MPs earlier this month he will not meet his original target for cutting the budget deficit in 2014/15. The new target figure - £91.3bn - while higher than expected, is below last year's total.
One swallow does not make a summer, and although the figures are moving in the right direction we have to remember that public sector borrowing for the financial year so far is only very slightly down on last year.
James Sproule, chief economist at the Institute of Directors