UK's finances hit by borrowing high
Updated on 20 July 2010
Government borrowing hit a higher-than-expected £14.5 billion last month, official figures have revealed.
The woes facing Britain's battered finances showed few signs of easing as the Office for National Statistics (ONS) confirmed the budget deficit widened by another £700 million in June to £12.6 billion.
Last month's public sector net borrowing was £200 million less than the £14.7 billion seen a year ago, but was more than the £13.5 billion expected by analysts.
Figures excluding the temporary effects of State financial intervention showed borrowing rose to £15.2 billion up from £14.9 billion in June 2009.
The UK remained deep in the red as overall receipts rose by 4% in June - the weakest growth since January.
Spending rose 5% to £49.3 billion, highlighting the scale of the challenge ahead for the Chancellor in addressing the gaping deficit. Net debt is now 56.1% of gross domestic product - far higher than the 47.7% last June.
The ONS said last month's budget deficit figure was the highest ever recorded for June.
Jonathan Loynes, at Capital Economics, said the borrowing news put a "dent in hopes" that public finances were now on a clearly improving trend.
Recent figures had suggested the pace of borrowing growth was easing. But June's data was far worse than expected and the ONS also revised up borrowing for May.
Mr Loynes said there was now a risk the full-year deficit could overshoot the recent Budget forecast put forward by the Office for Budget Responsibility.
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