Britain posts surprise borrowing gap in July

Britain posts surprise borrowing gap in July

LONDON - Agence France-Presse
Recession-hit Britain unexpectedly added to its public sector debt pile in July, official data revealed yesterday, dealing a blow to the government’s hopes of reducing the country’s large deficit.
Public sector net borrowing stood at 600 million pounds

(763 million euros) in July compared with a net repayment of 2.8 billion in the same month one year earlier, the Office for National Statistics said in a statement yesterday.

Treasury: Corporation taxes weak in July

Analysts had forecast a July net repayment of 2.5 billion pounds, according to a poll by Dow Jones Newswires.

Last month tends to be a surplus month as it sees the Treasury receive a large slice of owed tax receipts.
Explaining the surprise data, a Treasury spokesman said: “Tax receipts are coming in below forecast but this is mostly explained by the weakness in corporation tax, especially from North Sea oil production.”

He added: “The government remains committed to the credible plan we have set out to deal with Britain’s debts.” The official data excludes the temporary effects of financial interventions such as bank bailouts.