Yael Selfin, Chief Economist at KPMG UK, comments on today’s public finance figures:
“Cumulative public sector net borrowing reached £12.8bn in July, down on the previous month due to a surplus of £2.0bn. If the pattern for the balance of spending follows the trend we’ve seen over the last two years, the Chancellor may have an extra £10bn to spend from this (2018-19) fiscal year. In addition, the latest estimate on the level of public sector net borrowing for the previous financial year (2017-18) also shows an extra £5.8bn that the Chancellor may be able to spend from that year, taking the overall figure for both financial years to around £16bn.
“The Prime Minister’s recent commitment to increase NHS spending by an estimated 3.4% in real terms over the next five years is expected to add around £16bn to spending, so the extra savings from public borrowing have already been committed. This means there will be little room for additional spend in the Autumn Budget if the Chancellor wants to stick to his target to bring the structural deficit to below 2% in 2020-21.”
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