BCC: Welcome Deficit Reduction in March, but Huge Task Still Lies Ahead
- Public sector net borrowing, excluding public sector banks, fell by £17.7 billion in the full financial year ending March 2016
- Public sector net borrowing, excluding public sector banks, fell by £2.6 billion in March 2016 compared with March 2015
- Public sector net debt, excluding public sector banks, at the end of march 2016 was 83.5% of GDP
Commenting on the public sector finance figures for March 2016, published today by the ONS, David Kern, BCC Chief Economist, said:
“Despite a welcome improvement in public finances in March, and further gradual progress expected in the year ahead, our view is that the return to a budget surplus may take a little longer than the OBR predicted.
“The structural changes in the UK economy since the financial crisis have reduced the capacity of the economy to generate tax receipts, and our public spending will have to adjust in the coming years to this new reality.
“While this may necessitate painful measures, only by putting our public finances on a sound basis will it be possible to create a stable environment for business to thrive.”