British state borrowing climbs: official data

21st July 2011, Comments 0 comments

British state borrowing rose in June, but finance minister George Osborne remains on course to meet his annual target after downward revisions to previous months, official data showed on Thursday.

Public sector net borrowing hit £14 billion ($23 billion, 16 billion euros) in June, the Office for National Statistics (ONS) said in a statement.

That compared with net borrowing of £13.6 billion in June 2010, while market expectations had been for about £12.5 billion.

However, borrowing shortfalls for May and April were both revised sharply downwards.

"The public finances were disappointingly slightly weaker in June compared to a year ago, but there was some better news for the chancellor as the May and April shortfalls were revised down," said IHS Global Insight economist Howard Archer.

"As a result, there was marginal overall improvement in the public finances in the first three months of fiscal 2011/12," he added.

The government's official target is to cut borrowing to £122 billion in the current financial year which runs until March 2012. The forecast compared with total borrowing of £143.2 billion in 2010/2011.

The British economy is meanwhile struggling to rebound from recession amid steep public spending cuts and tax hikes.

Next Tuesday, the ONS will publish its first estimate for gross domestic product (GDP) for the second quarter of this year, or three months to the end of June.

© 2011 AFP

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