Royal Mail share sale increases UK borrowing by 300 mln stg

LONDON, Nov 19 (Reuters) - The British government's transfer of some Royal Mail (LSE: RMG.L - news) shares to staff as part of the postal group's privatisation added 300 million pounds ($483 million) to public borrowing last month, the Office for National Statistics said on Tuesday.

In a statement on how accounting rules applied to the public finances, the ONS ruled that the sale of shares to investors would have no impact on the main fiscal measure targeted by the government, public sector net borrowing.

"This transaction has no effect on the government deficit as it is simply a re-classification of assets in the government balance sheet," the ONS said, noting that shares were being exchanged for cash.

However the public sector net cash requirement - which affects how much money Britain needs to borrow from financial markets - would be reduced by 2.0 billion pounds in October, the ONS said.

The ONS releases full October public borrowing data on Thursday.