UK government borrowing below expectations in April

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UK government borrowing below expectations in April

The government borrowed 18.6 billion last month, 5.6 billion less than in April last year, and was below expectations, according to the government.

The Office for Budget Responsibility's estimates of borrowing were for 19.1 billion and the city economists had predicted 18.8 billion billion. It is the fourth highest borrowing for the month since records began in 1993.

The government was helped by a 5.5 billion increase in taxes to 50.2 billion, including 1.4 billion from the increase in National Insurance. Total receipts rose to 70.2 billion, 9.9 billion more than in the same month last year.

The inflation to 40 year highs is pushing up the cost of servicing debt, as the government continued to be helped by the drop in spending on Covid 19, while the rise in inflation was also helped by the drop in spending on Covid 19. Debt interest payments were 4.4 billion. There was a rise in the retail prices index, which determines payouts on index-linked gilts, which led to 3.9 billion dollars being paid last month.

According to Michal Stelmach, senior economist at KPMG, we expect monthly interest spending to reach an eye-watering 16 billion in June, exceeding the annual day-to- day budget of the Home Office. Inflation is pushing up our spending on debt, which is expected to reach 83 billion this year, and we are doing what we can to help families deal with rising prices, according to Rishi Sunak, the chancellor. We must take a balanced and responsible approach to support people now, while also not burdening future generations, and we are on track to drive public debt down by the year 2024 -- 25. The chancellor announced 22 billion of temporary support to cushion the cost-of-living squeeze on households in his spring statement, but is under pressure to do more. He is considering a windfall tax on electricity companies as well as oil and gas suppliers to help households cope with the rise in energy prices.

The energy bill for millions of households with bills that are affected by the energy price cap went up 54 per cent last month. The war in Ukraine has resulted in a rise in food prices.

Paul Dales, chief UK economist at Capital Economics, said: "The lower-than expected public borrowing of 18.6 billion in April and the downward revisions to borrowing in 2021 -- 22 will add to the pressure on the chancellor to go big when finalising the support package for households. We think that the support will be small and targeted rather than big and widespread. Samuel Tombs, chief UK economist at Pantheon Macroeconomics, predicted that public borrowing would be over 110 billion this year, above OBR's 99.1 billion forecast, even before any additional measures to support households are taken into account. The public sector net debt stood at 2,347, according to Samuel Tombs, chief UK economist at Pantheon Macroeconomics. At the end of April, there was 75.7 per cent of gross domestic product, a 0.9 percentage point higher year on year.

The Office for National Statistics has revised down its borrowing estimate to 144.6 billion in the year to the end of March, from 151 billion previously. It remained above the OBR's forecast of 127.8 billion.