Public finance data, February 2017 - PwC comments
Published at 10:21 AM on 21 February 2017
Commenting on today's public finance data, John Hawksworth, PwC chief economist, said:
“The ONS handed the Chancellor a £5 billion pre-Budget windfall today by revising down its earlier estimates of public borrowing in the period from April to December 2016 by around £5 billion. This was largely due to a £4 billion boost to estimated corporation tax receipts, partly due to a methodological shift from cash to accruals accounting, as well as a cut in estimated EU budget contributions over this period.
“Together with a £9.4 billion budget surplus in January, which was slightly higher than last year although below market expectations, the budget deficit for 2016/17 as a whole now looks set to come in below £60 billion. This would be well below the OBR's estimate of around £68 billion in November, although probably still higher than the pre-referendum estimate of £55.5 billion at the time of the March 2016 Budget.
“Overall, the public finances now look in rather better shape than they did three months ago, and more in line with other data showing a relatively robust UK economy in the period since the Brexit vote. This should give the Chancellor a bit more room in his Budget on 8th March to find extra money for priorities like the NHS and social care, and possibly also to alleviate the increase in business rates for the biggest losers from the coming revaluation in April.”
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