The Office of National Statistics published their ‘Statistical bulletin: Public sector finances, UK: July 2018. How the relationship between UK public sector monthly income and expenditure leads to changes in deficit and debt.’ Basically, balancing the country’s books; is Britain making as much in tax, as it is spending on public services? This report says that the government has a surplus of £2bn in July – that means it is £2bn in the black. Previous estimates from City experts were only £1bn.
What else do we know about our financial situation?
We also know that this is the most that the Treasury has been in surplus for the last 18 years.
In terms of government borrowing, there is a significant decrease compared to last year. In 2017-18, after four months, the government had borrowed £21.3bn. In the same four months of 2018-19 financial year, this figure is £12.8bn. If things continue at the same rate, borrowing would only be £24bn for the entire 2018-19 financial year. This is substantially less than the Office for Budget Responsibility’s £37.1bn estimate.
How has this budget surplus been achieved?
The budget surplus has been achieved with the usual combination of increased income and decreased outgoings.
Increased income is from more tax coming into the Treasury. This is the percentage increase in tax takings as compared to the same time last year:
Britain’s outgoings on public services is only 0.7% higher.
A spokesperson form the Treasury said: “Thanks to the hard work of the British people, government borrowing is down by three-quarters and debt is due to begin its first sustained fall in a generation. But we cannot be complacent, and we must keep debt falling to build a stronger economy and secure a brighter future for the next generation.”
How does this affect me?
You already know how the government’s commitment to an ‘austerity’ driven economic plan affects your life and there is plenty of news coverage about it impacts our education system, police, armed forces, NHS, social care, fire service, prison service and local government provisions. There is the suggestion that the Chancellor now has more flexibility in the Autumn Budget to plough some of this unexpected surplus back into public services, as this means there is no reason to divert the money from another purpose.
But he may also need to raise taxes further in order to maintain the current level of ‘surplus’ while simultaneously rectifying some of our public services issues. People’s individual opinions and experiences of living with government policies are always varied. We bring you statistical information from official sources with some reported interpretation from different perspectives to give some context and meaning to the figures.