Author Archives: Mark Dembowicz

Student loans to add £10 billion to measured deficit

Public sector borrowing was higher than last year, both in May and over the year to date. More materially, a forthcoming improvement in the accounting treatment of student loans will raise the measured deficit by more than £10 billion a year. This is close to our estimate from March, when we thought it would reduce…

Deficit continues to fall significantly in 2018-19

Higher spending pushed borrowing up slightly in December, relative to last year. But over the first nine months of 2018-19, borrowing is still down by more than a quarter relative to the same period in 2017-18.

Underspending pushes deficit lower

Last year’s budget deficit has been revised £2 billion lower to £40.5 billion, with departments thought to have undershot their spending limits by more than originally estimated. But the figures are still liable to significant further revision.

OBR could incorporate Brexit agreement in a December forecast

At the request of the Treasury Committee, the OBR has confirmed that it should be able to incorporate an October EU exit agreement in an early December Budget forecast, updating its existing Brexit assumptions as necessary. But it is not clear how firm or detailed the agreement will be and important policy questions are bound…

Provisional estimate shows 2017-18 borrowing lower than forecast

Public sector net borrowing in 2017-18 is provisionally estimated at £42.6 billion, £2.5 billion lower than we forecast at the Spring Statement in March. Lower-than-expected local authority borrowing more than explains that difference, but firm outturn data on that will not be available before September.

Deficit falls in the first half of 2017-18

Halfway through 2017-18, borrowing is £2.5 billion down on the same period in 2016-17. While this suggests we will need to revise down full-year borrowing in our November forecast, it remains likely that the deficit will rise relative to 2016-17. Self-assessment income tax receipts in January and February are expected to fall year-on-year.

Welfare reforms save less than expected

Straightforward cuts in the generosity of benefits and tax credits are proving more reliable ways to cut the welfare budget than complex structural reforms to incapacity and disability benefits. Read more in our latest Welfare trends report.

Robert Chote reappointment confirmed

The Chancellor nominated Robert Chote to serve a second and final term as Chair of the OBR. The Treasury Select Committee approved the re-appointment on 15 September 2015, saying that they were “satisfied that Robert Chote has the professional competence and personal independence to be reappointed as Chair of the OBR. His work over the last…

Government recommends boost to OBR capacity

A Treasury review has concluded that the OBR is a “respected and successful” organisation five years after its creation. It recommends boosting the OBR’s current capacity and a new publication on fiscal risks, but rejects extending its remit to manifesto costings and distributional analysis. Read the HM Treasury Review of the OBR on GOV.UK The…

Fiscal sustainability report 2015

Our fifth Fiscal sustainability report shows that further tax increases or spending cuts are likely to be needed after the current fiscal consolidation to help meet the costs of an ageing population. The full report and accompanying documents can be found on the main FSR page.