UK state borrowing rises in February

Friday 21 March 2014 12.11
The UK's public sector net borrowing rose to £9.3 billion in February
The UK's public sector net borrowing rose to £9.3 billion in February

The UK's state borrowing worsened in February, official data showed today, but the government remains on track to meet the new deficit target unveiled earlier this week.

Public sector net borrowing, the government's preferred measure of the deficit, rose to £9.3 billion in February. 

That compared with £6.5 billion the same month of 2013, the Office for National Statistics (ONS) said in a statement. Market expectations had been for borrowing of about £8.8 billion.

Last year's February borrowing was skewed by a one-off windfall from 4G mobile licences as well as interest earned from the Bank of England's quantitative easing programme of asset purchases. 

However, analysts said today's data left the government on course to meet its annual borrowing target of £108 billion for the 2013/2014 financial year that runs from April until March.

The latest official target, unveiled by British finance minister George Osborne in his annual budget on Wednesday, was less than previous borrowing forecast of £111 billion.

However, the ONS said today that underlying public sector debt was £1.2468 trillion, or 74.7% of gross domestic product (GDP) at the end of February 2014.

That marked an increase on 72.5% the same time last year, while it was also up on last month's reading of 74.6%.

Mr Osborne had also revealed on Wednesday that the government expects to wipe out its annual budget deficit by the end of the decade.

After the current financial year, state borrowing was then forecast to drop to £95 billion in 2014/2015, followed by £75 billion, £44 billion and £17 billion in subsequent financial years, with a surplus of almost £5 billion expected in 2018/2019.