The latest from the Black Country 

BCC: Further Progress in Cutting the Deficit but UK Still Faces Big Challenges

  • In May 2015, public sector net borrowing, excluding public sector banks, was £2.2bn smaller than a year earlier
  • In the first 2 months of the current financial year, public sector net borrowing, excluding public sector banks, was £5.1bn lower than in the corresponding period of the previous financial year
  • At the end of May 2015 public sector net debt, excluding public sector net banks, was 80.8% of GDP

Commenting on the Public Sector Finances for May 2015 published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce, said:

“The new financial year started on a positive note and these figures show further encouraging progress towards cutting the UK’s deficit. It is too early to reach firm conclusions but, if current trends continue, there is a realistic prospect that total borrowing will fall in line with the official forecasts made at the time of the last Budget.

“However, we must not underestimate the huge challenges the UK is still facing to continue reducing the deficit. Britain’s financial sector was hit hard during the recession and, together with lower oil and gas output, the UK’s ability to generate tax revenues is constrained. Stabilising our public finances and reducing current public sector spending are necessary steps to take if we are to live within our means. But the government must also place much more emphasis on boosting growth. Only then will the UK have a vibrant economy which is able to create wealth over the long term and deliver the tax revenues that the economy needs.”

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