UK government borrowing

UK government borrowing from April through to January was £21.2 billion, marking £18.5 billion less than the year before.

According to the Office for National Statistics (ONS), net borrowing for the month was in a record surplus of £14.9 billion, an increase of £5.6 billion from last January.

This marked the largest surplus for the UK government since records began in 1993.

This was attributed to a rise in self-assessment income tax as well as capital gains tax.

Howard Archer, chief economic adviser to the EY Item Club, commented: “A record high surplus on the January public finances provides a much-needed welcome boost for Chancellor Philip Hammond as he faces a worrying backdrop to his Spring Statement on 13 March.

“With the economy clearly struggling early on in 2019 after a sharp slowdown in the fourth quarter of 2018 and the Brexit situation highly uncertain, the chancellor will have a lot on his mind when he presents the Spring Statement.

“It looks highly likely that he will have to announce downgraded growth forecasts from the OBR [Office for Budget Responsibility] at least for the near term, with possible negative ramifications for expected budget deficits.”

The chancellor Philip Hammond is set to deliver his next budget statement on the 13th of March.

Whilst the chancellor will be busy putting together his speech, the rest of the UK government has been preoccupied with the deflection of three of its Conservative MPs, making it even harder to pass any legislation in parliament.

On Wednesday, Anna Soubry, Sarah Wollaston and Heidi Allen joined the Independent Group, resigning their membership from the Tory party.

The Independent Group now includes 8 Ex-Labour MPs and 3 Conservative deflectors.