Yahoo Finance Osborne Meets Deficit Reduction Target
The Chancellor has met his 2014/15 deficit reduction target, with public borrowing for March falling to its lowest level since 2004.
George Osborne dodged potential embarrassment just two weeks ahead of the General Election when the Office for National Statistics (ONS) confirmed public sector net borrowing, excluding the effects of bank bailouts, totalled £7.4bn in March.
It meant borrowing for the financial year came in at £87.3bn, below the latest projection of £90.2bn set by the independent Office for Budget Responsibility (OBR).
It represented a fall of more than £11bn on the previous year.
The ONS, which cautioned that its figures were provisional and subject to revision, said the public finances were boosted by record income tax revenue in the year to 31 March.
Income and capital gains tax receipts grew by £8.1bn to £169.7bn while revenues from stamp duty on land and property rose £1.5bn to £10.9bn.
As voters prepare to go to the polls, the figures show annual borrowing has fallen by more than £60bn from £153.5bn in 2009/10 just before the Coalition came to power.
As a percentage of gross domestic product (GDP) it has dropped by half from 10.2% to 4.8%.
However, the national debt of £1.48tn is more than £500bn higher than the 2009/10 figure of £956bn.
The nation's debt represents 80.4% of GDP, up from 62% five years ago.
The parties' spending plans for the next Parliament have proved to be one of the biggest battlegrounds in the run up to 7 May.
The Conservatives want to deliver a small overall budget surplus by 2018/19 while Labour, using a different measure, has said it aims to eliminate the deficit on the current budget - which excludes investment - as soon as possible.
The argument between them essentially centres on austerity versus spending.
The Liberal Democrats say they would eliminate the structural current deficit (the Government's annual overspend that is not directly affected by economic performance) in 2017-18.
The independent Institute for Fiscal Studies issued on Thursday its verdict on their manifestoes, and that of the SNP, and said each left many unanswered questions on spending plans.
Commenting on today's figures, the TUC union organisation said they demonstrated that Mr Osborne's plans had failed because the 2014/15 deficit was £50bn larger than the Government had planned in 2010.
The business lobby group, the CBI, argued that whoever forms the next government must prioritise deficit reduction as sound public finances were vital to supporting business confidence and funding sustainable public services.
