The Office for National Statistics said public sector net
borrowing rose to £15.607 billion last month from 1£4.806 billion a year ago,
confounding economists’ expectations for a modest fall. Britain’s monthly
budget numbers are very seasonal, and this is the highest for a month of
September since records began in 1993. Government forecasts are based on a
measure of PSNB that excludes financial sector interventions, and this also
rose in September to a record for that month, increasing to £16.166 billion
from £15.461 billion in September 2009.
PSNB-ex is predicted to fall to £149 billion this fiscal
year from £156 billion in 2009/10.
Despite the surprisingly high September borrowing,
economists said it was still possible for the government to meet this target.
“The figures are still running a little bit below the
equivalent period in the previous financial year and, arithmetically at least,
seem on course to meet the Office for Budget Responsibility’s forecast for
2010/11,” said Investec economist Philip Shaw.
The government is likely to seize on the figures as evidence
of the urgent need for fiscal tightening, despite concerns from opposition
politicians and some economists that it could tip Britain back into recession.
“September’s public finances show that the slowing of the
wider recovery in recent months is starting to weigh on the borrowing figures,”
said Capital Economics’ Samuel Tombs. “It casts a shadow over the Spending
Review to be delivered to Parliament today.”
