Chancellor George Osborne\u2019s efforts to cut the national debt have been dealt another blow after missing his borrowing target for the second month in a row.<\/p>\n
Figures released by the Office for National Statistics showed that public sector net borrowing was \u00a39.7 billion in May, or the equivalent of \u00a33,621 a second.<\/p>\n
This was higher than forecasts but \u00a30.4 billion lower than the deficit in May 2015.<\/p>\n
It was previously reported that for the financial year 2015\/16 net borrowing was \u00a376 billion \u2013 missing the ONS target by \u00a32.7 billion.<\/p>\n
This was despite the Treasury’s coffers being boosted by a rise in stamp duty for second homes, income tax, national insurance contributions, corporation tax and VAT receipts.<\/p>\n
The chancellor had taken \u201chis eye off the economic ball\u201d, according to Ross Campbell, public sector director at accountancy industry body ICAEW<\/p>\n
He added: \u201cIt was imperative that the chancellor put public sector finances at the top of his priority list. [But these figures] illustrate that he has done quite the opposite and has taken his eye off the economic ball.<\/p>\n
\u201cIt is vital that government devises a comprehensive and rigorous strategy to kick-start a faltering economic recovery.\u201d<\/p>\n
The British Chambers of Commerce chief economist, David Kern, agreed that things didn\u2019t look good. He said: \u201cAlthough borrowing fell marginally in May, the first two months of the current financial year point to disappointing progress in reducing the deficit, and our assessment remains that reaching a budget surplus by the end of the decade will be difficult to achieve.\u201d<\/p>\n
Scott Bowman, an economist at Capital Economics, put the figures down to \u201cthe effect of the recent slowdown in the economy.\u201d<\/p>\n
Alan Clarke, an economist at Scotiabank, said the Government faced a tough challenge to cut borrowing this year.<\/p>\n
He said: \u201cTwo months into the financial year and we are seeing borrowing up cumulatively by \u00a3150m compared with the same two months a year earlier – higher borrowing not lower.<\/p>\n
\u201cSo now the run rate needed to hit the full year target is a \u00a32 billion reduction per month. It\u2019s still early days, but the main message is slippage.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
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