MNI: Revisions to UK 2017/18 Borrowing To Be Limited: OBR

By Jamie Satchithanantham

     LONDON (MNI) - Despite the latest estimate of public sector net borrowing

coming in significantly lower than their March forecast, the Office for Budget

Responsibility has cautioned this will unlikely generate any major downward

revisions to the OBR's 2017-18 forecast which is set to accompany next month's

Budget announcement.

     At stg45.7bn, the latest estimate of public sector net borrowing stands

some stg6.4bn lower than the OBR's March 2017 forecast. But the OBR, in its

monthly commentary, warned that "only part of this difference is likely to

prompt downward revisions to our forthcoming forecast for 2017-18".

     Data released on Friday by the Office of National Statistics saw

year-to-date borrowing in September, which covers the first six months of the

financial year, total stg32.5bn. This was 7.2% lower than that over the same

period of last year and the lowest half-year tally since 2007.

     The OBR, however, said that this was "likely to overstate" the extent to

which full-year borrowing will be revised down in their November forecast, with

a simple extrapolation seeing 2017-18 borrowing coming it at stg42.4bn,

stg16.2bn lower than the forecast the OBR made in March.

     Such an approach was "unlikely to provide a good guide" as the data did not

reflect the predicted stg3.8bn fall in self assessment income tax receipts, owed

to the unwind of dividend forestalling that look set to reduce incoming receipts

in January and February, and greater uncertainty surrounding local authority net

borrowing this year.    

     Today's monthly commentary released by the OBR will be the last piece of

communication released by the body before the November 22 Budget, at which it

will release its updated raft of economic forecasts.

--MNI London Bureau; +44 203-586-2226; email: jamie.satchithanantham@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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