Public Finance Press Releases

Public finance bulletin: December 2008

Date: 18 December 2008
Authors:

Headline comparisons

  • Central government current receipts in November were 5.2% lower than in the same month last year. Receipts in the first eight months of 2008-09 were 0.5% higher than in the same months of 2007-08. Last month's Pre-Budget Report forecast for 2008-09 implies a fall relative to last year's levels of 0.6% for the year as a whole and of 3.0% for the period from November 2008 to March 2009.

  • Central government current spending in November was 6.2% higher than in the same month last year. Spending in the first eight months of 2008-09 was 6.1% higher than in the same months of 2007-08. Last month's Pre-Budget Report forecast for 2008-09 implies an increase over last year's levels of 5.6% for the year as a whole and of 5.0% for the period from November 2008 to March 2009.

  • Public sector net investment in November was £3.0bn, compared to £2.5bn in the same month last year. Together, public sector net investment during the first eight months of 2008-09 has been £16.7bn, which is 50% higher than in the same months of 2007-08. Last month's Pre-Budget Report forecast for 2008-09 implies an increase of 24% for the year as a whole and an increase of 9% for the period from November 2008 to March 2009.

  • Public sector net borrowing during the first eight months of 2008-09 was £56.1bn, which is 92.1% higher than the same period last year. The next four months is also set to see a further increase in borrowing of around £5bn as a direct impact of measures announced by Alistair Darling that are yet to be fully reflected in the monthly figures for borrowing. For example the thirteen month 2.5 percentage point reduction in the main rate of VAT, which came into force from 1st December 2008, is costed by the Treasury at £3.8bn in 2008-09, while extra support for all pensioners and all families with children from January is costed at £1.1bn. Taking the expected cost of all these measures into account and assuming that the underlying trend in borrowing were to continue for the remaining four months of this financial year, then Public Sector Net Borrowing for the year as a whole would be around £73bn. This is compared to the £77.6bn forecast in last month's Pre-Budget Report and the £42.5bn forecast in the March 2008 Budget.