UK public sector borrowing below expectations, declines to lowest level since 2007

UK public sector borrowing excluding banks in February missed expectations and declined to its lowest level since 2007. Data released by the Office for National Statistics (ONS) Tuesday showed that UK borrowing excluding public sector banks fell by GBP 2.8 billion year-on-year to GBP 1.8 billion, below forecasts at GBP 3.2 billion.

In the current financial year-to-date, public sector net borrowing excluding banks decreased by GBP 19.9 billion to GBP 47.8 billion. The figure was the lowest year-to-date borrowing since the financial year-to-date ending February 2008.

The ONS noted that receipts are particularly high in both January and, to a lesser extent in July, due to the receipt of self-assessed income tax, capital gains tax and self-assessed national insurance contributions. The latest report included for the first time the GBP 497.25 million deferred prosecution agreement payment from Rolls-Royce PLC after a probe into bribery and corruption, the ONS adds.

Net debt excluding public sector banks totaled GBP 1,699.7 billion at the end of February, equivalent to 85.4 percent of gross domestic product. The figure was higher than the GBP 111.1 billion or 2.3 percentage points as a ratio of GDP, since February 2016