Borrowing rockets to £9bnHighest in more than a decade
19 March 2009
The UK plunged further into the red in February as public borrowing soared to £9 billion, official figures show.
The record figure for the month brings borrowing in the 11 months of the financial year so far to £75.2 billion, also the highest since records began in 1993, the Office for National Statistics (ONS) said.
The worsening state of the public finances was driven by a fall of almost 10% in government tax receipts over the month compared to a year earlier as the recession tightens its grip.
VAT receipts in February were 31% below last year, thanks to the slowing economy and the government's temporary VAT cut introduced late last year.
The UK is now labouring under a debt burden of £717 billion, the figures showed, more than £100 billion above a year earlier.
Net debt as a proportion of GDP soared to 49% - another record - and even excluding the impact of financial sector bailouts, still stood at 40.7%, the highest since June 1998.
This leaves the sustainable investment rule of then-chancellor Gordon Brown - that net debt should never exceed 40% of output - an even dimmer memory as borrowing soars in recession.
Borrowing last year
A year ago net borrowing was £1.1 billion - just over a 10th of the current figures.
The £75.2 billion figure is more than three times higher than the £23 billion recorded a year ago.
The latest dire blow for the public finances means chancellor Alistair Darling is virtually certain to exceed his net borrowing forecasts of £78 billion for the current financial year.
Economists predict the figure could reach £90 billion or higher.
The data also showed the government running a current budget deficit during February for the first time since the ONS began collecting figures in 1998.
Total current tax receipts fell to £40.7 billion from £45.1 billion a year earlier, although spending rose by 6.5% to £43 billion.
This includes a rise of £1 billion in social benefits to £12.1 billion as unemployment - which topped the two million mark for the first time in a decade this week - continues to rise.
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