MNI DATA ANALYSIS: June Borrowing Falls Courtesy of EU Credit>

-UK June borrowing Stg5.394bn vs Stg6.239bn June 2017

-UK April-June borrowing -24.4% over 2017 to Stg16.8 billion

     By Laurie Laird and Jamie Satchi 

     London (MNI) - UK public borrowing continued to decline in June, 

despite recent warnings from the government's fiscal watchdog over 

budget-busting government pledges to increase spending to the National 

Health Service. 

     June borrowing, excluding the Bank of England, slipped to Stg5.394 

billion, slightly above the MNI median forecast of Stg5.0 billion, down 

from Stg6.239 billion a year earlier. 

     Net debt fell to 76.1% of gross domestic product in June, from 

79.6% in the same month of 2017. 

     Government outlays declined by 3.1% to Stg57.6 billion, with 

Westminster benefitting from a retrospective adjustment in payments to 

the European Union, which flattered the government's fiscal position by 

a net Stg500 million over the same month of last year. 

     Value Added Tax receipts continued to boost government revenues, 

jumping by 4.0% to Stg11.9 billion, a record take for the month of June. 

Income and capital gains taxes increased by 2.1% to Stg12.9 billion, 

while corporation tax rose by 1.6% to Stg5.1 billion in June. 

     Over the first three months of the fiscal year, borrowing fell by 

24.4% over the same period of 2017 to Stg16.8 billion, the lowest 

year-to-date outturn since 2007. 

     In March, the Office for Budget Responsibility forecast a 6.2% drop 

in 2018/19 borrowing to Stg37.1 billion. But earlier this week, the OBR 

warned that the government's pledge to increase funding to the National 

Health Service could blow a hole in borrowing targets in the absence of 

politically-difficult tax increases. A National Statistics official had 

no information about when the extra health funding will hit the public 

finances. 

     The central government net cash requirement fell to Stg12.975 

billion in June, from Stg17.774 billion a year earlier. 

     The current budget deficit rose fell to Stg2.566 billion last 

month, from Stg3.142 billion a year earlier.    

     Including the Bank of England, public sector borrowing declined to 

Stg4.530 billion in June from Stg4.629 billion last year. 

-London bureau: 44 (0) 203 865 3812; email: ukeditorial@marketnews.com

[TOPICS: M$B$$$,MABDS$]