George Osborne will be breathing a sigh of relief this morning. The boast he made in his Autumn Statement in December — ‘the deficit is coming down this year, and every year of this Parliament’ — appears to have held up. But only just.
The figures from the ONS today show that the government borrowed £120.9 billion in 2011-12 and £86.2 billion in 2012-13. But that 2012-13 figure is artificially lowered by £28 billion by the Royal Mail pension transfer, and by a further £6.4 billion by the cash transferred to the Treasury from the Bank of England’s Asset Purchase Facility. Strip out those two effects and borrowing in 2012-13 was £120.6 billion — still lower than 2011-12, but only by £300 million, or 0.3 per cent.
And even that figure benefits from another one-off effect: the
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