Reducing The Deficit Remains Difficult
19 July 2013 in Chamber News
• In June 2013, public sector net borrowing, excluding the effects of financial interventions and transfers from the Bank’s QE scheme, was £12.4bn, £0.5bn higher than in June 2012 when it was £11.9bn
• Public sector net debt at the end of June 2013 was 74.9% of GDP
Commenting on the public sector finances for June 2013, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:“Recent figures show a broadly unchanged position in the UK’s public finances compared with last year. This is in line with the OBR budget forecast which indicated a marginal reduction in the deficit this year. If the economy continues to improve in the next few quarters, we may well see a further reduction.
“However our structural deficit will remain unacceptably high for the foreseeable future. The government must persevere with making cuts in public spending, while shifting priorities towards measures to boost growth such as infrastructure investment, which would help businesses drive the economic recovery in the medium term. If the Chancellor demonstrates continued commitment to a realistic fiscal plan, the markets will allow him greater flexibility. He can then use this flexibility to implement measures that will drive the recovery.”