11/23/22, 8:33 PM Fiscal defi­cit in Octo­ber ‘fourth highest level for the month’

Fiscal defi­cit in Octo­ber ‘fourth highest level for the

month’

The Guardian · 23 Nov 2022 · 32 · Larry Elli­ott Eco­nom­ics editor

Gov­ern­ment help with energy bills and the impact of a slow­ing eco­nomy
helped push UK pub­lic bor­row­ing last month to the fourth highest level for an
Octo­ber on record.
The Office for National Stat­ist­ics said the gap between the state’s spend­ing and
its rev­en­ues widened by £4.4bn to £13.5bn last month as pay­ments began
under the energy sup­port scheme.
Higher debt interest caused by rising infla­tion, and the first pay­ments by the
Treas­ury to indem­nify the Bank of Eng­land for losses made on its buy­ing and
selling of gov­ern­ment bonds, also caused bor­row­ing to be higher than a year
ago.
The Octo­ber total was well below the £21.5bn expec­ted by City eco­nom­ists,
partly because the fig­ures did not include estim­ates of gov­ern­ment sup­port
provided for busi­ness.
A break­down of the ONS fig­ures showed the energy bills sup­port scheme –
which provides a £400 dis­count on bills – cost the gov­ern­ment £1.9bn in
Octo­ber, while the energy price guar­an­tee, which caps the aver­age house­hold
bill, cost £1.1bn.
Pub­lic bor­row­ing was £84.4bn in the first seven months of the 2022-23 fin­an­-
cial year, a £21.7bn drop on the same period of 2021-22 but £35.6bn higher
than in the period to Octo­ber 2019 just before the pub­lic fin­ances were affected
by the Covid pan­demic.
Ruth Gregory, a UK eco­nom­ist at Cap­ital Eco­nom­ics, said there were “grow­ing
signs” the weak­ness in eco­nomic activ­ity was hit­ting the state’s fin­ances.
“Total tax receipts in Octo­ber, at £70.2bn, were £700m lower than last Octo­-
ber’s level,” she said.
The chan­cel­lor, Jeremy Hunt, said:
ation and ensure the eco­nomic sta­bil­ity for long-term growth it is vital we put
the pub­lic fin­ances back on a more sus­tain­able path … we have taken the
neces­sary decisions to get debt fall­ing while tak­ing steps to pro­tect jobs, pub­lic
ser­vices and the most vul­ner­able.”

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