Austerity latest: spending up, deficit up.

We can all overdo it a little at Christmas, but the government’s monthly overdraft statement — which came in this morning — is of a different order. In December, HM Treasury spent £15.4 billion more than it received in tax, a worse result than December last year where the monthly deficit was £14.8 billion. And why? Well, growth has been sluggish (we may learn on Friday that the UK economy is shrinking again) so tax revenues have fallen. But, more worryingly, state spending seems to be running out of control too. The below graph, from Citi, sums it up. The blue is what is expected (from those fiscal Mystic Megs at the Office for Budget Responsibility) for 2012-13 and the pink is what we have seen in the first nine months of that period.
CoffeeHousers will notice that the last four bars show spending up, not down. A funny kind of sado-austerity. While