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Chancellor Jeremy Hunt has warned of a crackdown on “public sector waste” and focus on tackling debt after official figures showed weaker than expected borrowing last month.
The Office for National Statistics (ONS) said public sector net borrowing stood at £14.3bn last month, £1.6bn less than a year earlier.
The figure was well down on the £20.5bn forecast by the Office for Budget Responsibility (OBR) earlier this year.
Nevertheless, the sum took government borrowing during the first half of the financial year to £81.7bn – more than £15bn up on the same April to September period in 2022 despite record levels of tax.
But it is also 20% below where the OBR expected for the period.
As such, Mr Hunt is under pressure from within his own party to improve his party’s electoral prospects by announcing a series of tax cuts in his autumn statement to MPs due on 22 November.
Inheritance and corporation tax are two areas where the chancellor has faced intense lobbying.
He, however, has already strongly signalled that it is no time for giveaways or cuts, given a surge in the increase in the cost of servicing the UK’s debt pile.
The ONS put net debt at £2.59trn at the end of September.
That equates to almost 98% of the country’s annual gross domestic product and is 2.1% up on the same time last year.
The chancellor said last week that higher interest rates were likely to cost an extra £20bn-£30bn a year.
He has prioritised bringing down inflation given that tax cuts are, by their nature, inflationary as people have more money in their pockets to spend.
Easing inflation helps cut the cost of servicing…
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