UK public sector borrowing rises slightly
The UK government borrowed slightly more than expected in December- fuelling fears that the UK could lose its coveted AAA credit rating.UK public sector net borrowing, excluding financial interventions, hit £15.4 billion in December, the Office for National Statistics (ONS) said.
That marked a small rise from the £14.8 billion borrowed in December 2011.
The headline figure was slightly worse than expected – analysts had forecast borrowing of £15.2 billion.
December’s figure takes total borrowing so far this financial year, excluding a transfer of Royal Mail pension assets, to £106.5 billion, some £7.2 billion more than for the same period in 2011.
A Treasury spokesman insisted that the economy was healing and said that the figures indicated a gradual recovery.
The Pound fell against the euro immediately after the data was released – trading 0.2% lower at 1.1872 euros.
The data showed that government receipts rose 3.6%, while spending grew 5.4% in December compared with a year ago.
The broader public sector net borrowing measure – which includes the cost of bailing out the UK’s banks – rose to £13.2 billion in December from £12.6 billion a year ago.
The UK’s total public sector net debt, excluding the cost of bank support, is now £1.11 trillion, or 70.7% of GDP.
All three of the major credit ratings agencies now have the UK’s AAA rating on negative outlook, meaning they could downgrade its rating if performance deteriorates.
In his Autumn Statement in December, Chancellor George Osborne acknowledged public finances were taking longer to rectify than planned, and admitted he would be forced to extend austerity measures by at least another year.
The news on public sector finances comes days before economic growth (GDP) figures are expected to show the economy contracted in the final three months of 2012.
February 28, 2013 Tags: borrowing, Credit Crunch, Debt Crisis, Loan calculator, recession, uk recession Posted in: Borrowing Costs, Credit Crunch, Debt Crisis, Financial Services, Loans Calculators, UK Loans Rates, Uncategorized