“These figures are worse than expected and provide a weak background for the Budget. After last month’s positive figures, there were hopes that the deficit in the current financial year would be £7-8bn below the official forecast. But judging by these numbers, it seems the Chancellor will have much less room for manoeuvre.
“Given this background, it is important that the Government perseveres with its tough approach, aimed at stabilising Britain’s public finances. British business supports the need for credible deficit-cutting measures over the next few years and we believe that the proposed strategy is achievable. The emphasis on spending cuts, rather than tax increases, must be maintained to ensure the economy is on a sustainable growth path.
“But such measures will not suffice on their own. The strategy will only succeed if the austerity measures are backed by effective policies that enable businesses to create jobs and deliver growth. The Budget will be the test as to whether the Government will be able to translate its promises into real action, and deliver a strong enterprising economy.”