http://business.timesonline.co.uk/tol/business/economics/article7031896.ece
British finances to be 'worse than Greek deficit'
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Sterling dived as investors digested the ballooning deficit figures
Grainne Gilmore
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The Government is on course to run up a higher budget deficit this year than Greece after dire figures on the public finances today showed that it borrowed £4.3 billion more than it received in taxes in January, the first time this has happened.
January is usually a bumper month for tax receipts as people submit their tax returns and corporation tax payments fall due.
However, a steep decline in income tax and capital gains tax payments, coupled with a sharp rise in interest payments to cover the Government's debts, forced the Treasury to borrow money to balance its books.
The dire data confounded economists' expectations of a surplus of £2.8 billion, and falls far short of the £5.3 billion surplus recorded in January last year.
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It is the first January deficit since records began in 1993.
Jonathan Loynes, chief European economist for Capital Economics, said: "Extrapolating the trend forward now points to a full-year borrowing figure of about £180 billion, some £10 billion higher than the Chancellor’s Pre-Budget Report forecast of £170 billion on this borrowing measure.
"This would be the equivalent of around 12.8 per cent of GDP, just in excess of Greece’s 2009 deficit of 12.7 per cent.
"January’s UK public finances figures have further underlined the need for more decisive action to improve the fiscal position when the economy is strong enough to withstand it."
However, the country's total debt, which climbed to £848 billion, or 59.9 per cent of GDP, is still far below Greece's total debt, which is running at about 113 per cent of GDP.
Sterling dived as investors digested the data, with the pound sliding 0.4 per cent against the dollar to $1.5601 after falling to a session low of $1.5575.
However other economists were more upbeat on their outlook for the country's finances. David Page, an economist at Investec, expects that the total borrowing figure for the year will be around £168 billion.
On the Treasurys favoured measure of Public Sector Net Borrowing excluding financial interventions (PSNBx), he expects the total borrowing to reach £175 billion, below the Chancellor's forecast for £178 billion.
But Mr Page said that the country's finances remained in a perilous state.
"The task of the next government will be to repair the public finances and restore a path of fiscal rectitude. We remain convinced that this requires a sharper fiscal tightening than envisaged in the Pre-Budget Report."
This was echoed by Ross Walker, UK economist at Royal Bank of Scotland. "The UK public finances remain in a dire state and these data serve to emphasise the need for a credible medium-term fiscal strategy."
This came as new figures from the Council of Mortgage Lenders (CML) showed that gross mortgage lending dropped by nearly a third to to £9.1 billion in January, down 21 per cent from January last year.
This is the lowest level of mortgage lending since February 2000 and represents a fall from £11.5 billion in January 2009, according to the CML.
Borrowing more money, as a Sovereign nation, we should be coining our own money and issuing into the economy free of charge.
ReplyDeleteNo Borrowing, no loans, no loans, no national debt, no national debt means no need for an income Tax.
I try explaining this to my relatives, they all laugh and say, but you can't just print money.
I try my best to explain but they say, ohh, I'd rather pay my taxes and make sure I can rely on free healthcare, I'd hate to end up like America.
This is how Brainwashing works, a repeated mantra, 'taxes pay for services' becomes absolute truth irrespective of glaringly obvious evidence to the contrary.
I used to think that all I had to do was show them the truth and they would instantly snap out of it.
Even putting the evidence in front of people is no gaurantee they will wake up.
Maybe humour will get the point accross
We should have let the failed banks fail, forgiven all debts owed to those banks, All loans, credit card debts, mortgages and business loans, they only ever lent out fractionally reserved thin air credit anyway.
ReplyDeleteLet the people keep their cars, their homes and their businesses.
Those people would then have been significantly better off each month, they would have gone out spending so stimulating the economy.
New Banks would have sprung up in their Place or they could have been nationalised.
That would have been a Govt working in the interests of the Country and its people.
It is what I found funny about these "bailouts". They continue to make the same mistakes telling us now that "home ownership" is increasing faster than 2008.
ReplyDeleteOn top of that, the profits they claim to make is repatriated back into "Israel", and never used to create jobs.
One example was the UK bank helping Zionist Kosher food sellers to takeover Cadbury in the full knowledge of taking investments out of the country.
This governments is robbing milk and honey from its citizens, and gives back sh*t.
Listen, you Jews on the brain moron.
ReplyDeleteThe upcoming international crisis is intentional.
A Global reset is coming.
Global bankruptcies;
Then one global currency;
Then one global government;
Then one global leader;
Then all hell breaks loose.
If you think the Jews want this, or this will be good for the Jews, then you bigger moron than I think you are. Keep your cash home, not in the banks. Also, a good idea is to keep a 12 gauge with double aught shells ready. Sad, how misdirected you are.