Britain had a larger budget deficit than economists forecast in May as the recession depressed tax receipts and government spending surged.
The shortfall, which excludes government support for banks, was 17.9 billion pounds ($28 billion) compared with 15.2 billion pounds a year earlier, the Office for National Statistics said in London today. Economists forecast a deficit of 14.8 billion pounds, according to the median of 16 estimates in a Bloomberg News survey. Spending jumped 7.9 percent and revenue rose 1.6 percent. Income-tax receipts fell 7.3 percent.
The figures may provide ammunition to the opposition Labour Party, which says the government is making the recession worse by trying to cut the deficit too quickly. With the euro-region debt crisis intensifying, the data cast doubt on whether the government can achieve its goal of cutting the deficit to 120 billion pounds in the current fiscal year.
The Treasury said in a statement the government is committed to dealing with the deficit and that it is too early to draw conclusions about borrowing in the fiscal year as a whole.
Wednesday, June 27, 2012
Our programs are failing...full speed ahead
Oh that austerity: