Higher than expected government borrowing has reduced the Chancellor's
'wiggle room' at a pre-election Budget.
Government borrowing - the difference between spending and tax income - was
£120.7 billion in the year to March, according to the latest figures from the
Office for National Statistics (ONS).
This was £7.6 billion lower than last year, but £60 billion higher than the year
before the pandemic and, critically, £6.6 billion higher than the Office for
Budget Responsibility's (OBR) forecast at the Spring Budget.
High inflation and rising interest rates also contributed to public spending
rising by £58 billion for the year, according to the ONS.
Cara Pacitti, Senior Economist at the Resolution Foundation, said:
'Last year was one of high but falling inflation and rising interest rates,
causing both spending and tax receipts to rise in nominal terms compared to
the year before.
'While lower than last year, borrowing is already £6.6 billion higher than
forecast at the Spring Budget last month. So far there are no signs of any
new fiscal wriggle room emerging that might allow the Chancellor to announce
another pre-election Budget in the Autumn.'
Internet links: ONS website Resolution Foundation website