Public Borrowing Rises to £11.8bn in September

Government borrowing increased to £11.8bn in September, an increase of £1.6bn in comparison with a year earlier, according to the Office for National Statistics. 

The latest figures have been a setback for Chancellor George Osborne, who in March pledged to cut the budget deficit by more than 10% over the next 12 months. 

Between April and September borrowing was £58bn, a rise of £5.4bn compared with the same period last year. Economists were forecasting that borrowing would become stable. 

That is an increase of 10.3%. Last month’s figures showed borrowing between April and August was 6% higher than a year earlier.

“We have seen stronger growth in receipts this month, but as today’s figures show, the impact of the great recession is still being felt in our economy and the public finances,” a treasury spokesman said. 

Source: www.bbc.co.uk/business

Find us on Google

IMF Highlights Greek Tax Evasion

A recent IMF report has criticised the Greek Government in its strategy to bring its debts under control. 

The report highlights that the strategy “has relied far too much on cuts in discretionary spending and increased taxation of wage earners, while the rich and self-employed have continued to evade taxes on an astonishing scale and bloated and unproductive state sectors have seen only limited cuts”.

One of the conclusions of the report is that the programme will fail unless it overcomes “these entrenched vested interests”.

The report also highlights that Greece will need from the EU an extra £7.9bn to bring its debts under control. 

Written by Tim Corfield - Griffin and King

http://www.griffinandking.co.uk/

HOUSEHOLDS BRACED FOR 2013

Happy New Year! 

A survey carried out by Markit last month showed that 43% of households expect their finances to worsen this year against 24% who expect their finances to improve.

Without a strong rise in consumer spending it is unlikely there will be much real growth in 2013. Businesses held back investing in plant and machinery throughout 2012 and this is likely to continue if consumer spending remains subdued. 

Begbies Traynor have highlighted that around 140 high street shop chains could go out of business in 2013 without any increase in high street spending. These stores remain highly geared and will be seriously affected by the consumer continuing to bargain hunt and shop on-line.

A spokesman for Markit said ‘Households are bracing themselves for yet another year of squeezed personal finances in 2013. The vast majority of households anticipate that their financial wellbeing will either worsen or stagnate in 2013. With three quarters of all households not expecting any improvement in their finances, the latest survey suggests that domestic consumer demand will remain under pressure in the near term, especially since inflation perceptions remain elevated and job insecurities are prevalent’.

Tim Corfield