–Jun PSNB Stg14.498bn vs Stg14.725bn in Jun 09; median Stg13.2bn
–Jun PSNCR Stg20.905bn vs Stg20.213bn in Jun 09; median Stg16bn

LONDON (MNI) – Public Sector Net Borrowing came in higher than
forecast in June, as spending growth continued to outstrip receipts,
according to figures released by National Statistics Tuesday.

Public sector borrowing stood at Stg14.498 billion in June, a small
decrease from the Stg14.725 billion outturn in the same month a year
earlier. Analysts had expected to see a smaller shortfall of Stg13.2
billion.

Total current receipts rose 4% in June compared with a year
earlier, while current spending was up 4.6%.

There was also a revision to May, with net borrowing now estimated
at Stg17.05 billion compared with the initial estimate of Stg16 billion.

The current budget posted a deficit of Stg12.6 billion, up from
Stg12 billion in June 2009, the highest level for a June since records
began in 1998.

While the sharp deterioration in the public finances does seem to
have come to an end, fears remain that a weaker than expected economic
recovery over the coming years could mean lower tax revenues with
borrowing remaining at high levels.

For the first three months of the financial year net borrowing
stood at Stg40.3 billion, down slightly on the Stg40.9 billion seen
during the same period last year.

In his emergency Budget last month, George Osborne forecast
borrowing to ease to Stg149 billion from Stg154.6 billion in 2009/10.

The Public Sector Net Cash Requirement stood at Stg20.905 billion
in June, slightly up from Stg20.213 billion in June 2009, above the
median forecast of Stg16 billion.

As a percentage of GDP, net debt rose to 63.9% in June, up from
57.3% in the same month a year earlier.

–London bureau: email: drobinson@marketnews.com

[TOPICS: MT$$$$,M$B$$$,MABDS$]