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Public borrowing hits record high Public borrowing hits record high
(about 3 hours later)
The UK's public sector net borrowing hit a record high of £20.3bn in November, official figures have shown.The UK's public sector net borrowing hit a record high of £20.3bn in November, official figures have shown.
The figure was the highest for any month since records began in 1993, but was less than economists had expected.The figure was the highest for any month since records began in 1993, but was less than economists had expected.
The Office for National Statistics also said the public sector net debt as a percentage of overall UK economic output now stood at 60.2%. The Office for National Statistics also said the public sector net debt was £844.5bn, or 60.2% of overall UK economic output.
Government debt as a percentage of GDP has risen considerably since the start of the financial crisis.Government debt as a percentage of GDP has risen considerably since the start of the financial crisis.
In November 2008, public borrowing was £15.5bn, while net debt stood at £706.2bn, or 49.6% of GDP.
'Return to growth'
The Conservatives said the government had let spending get out of control.
ANALYSIS Hugh Pym, BBC chief economics correspondent
It tells you something about the state of the public finances when City analysts say the £20bn borrowing figure for last month was not as bad as expected.
The Treasury chose to look at the bright side by pointing out that tax receipts were actually higher than in the same month last year and that there were possible signs of a revival in revenues.
The latest figures don't make the chancellor's full-year forecast for £178bn look less realistic. That may be a relief to the markets.
But there is nothing in today's numbers to lighten the long term gloom over the public finances. Britain has a load of public sector debt which has to be tackled once the recession is through.
Shadow chancellor George Osbourne said: "In the run up to Christmas, Gordon Brown is maxing out on the nation's credit card - and doesn't care how we are going to repay these debts in the future.
"The record public borrowing figures equate to almost £1,000 for every family this month alone. Now we're all paying for Labour's failure to fix the roof when the sun was shining."
Despite the record drop, analysts had expected November's debt to be higher.
"The UK's public finances have deteriorated further in November, but not as badly as the market had feared," said James Knightley at ING."The UK's public finances have deteriorated further in November, but not as badly as the market had feared," said James Knightley at ING.
"Certainly the better labour market data is helping the government finances and a return to growth will further help moderate the rate of deterioration." "Certainly the better labour market data is helping government finances and a return to growth will further help moderate the rate of deterioration."
Data released earlier this week showed the increase in the UK unemployment rate continuing to slow between August and October.Data released earlier this week showed the increase in the UK unemployment rate continuing to slow between August and October.
But Mr Knightley said the size of the deficit would force the government to cut back on spending, which would "constrain the UK's growth prospects".But Mr Knightley said the size of the deficit would force the government to cut back on spending, which would "constrain the UK's growth prospects".
Securing growth is seen as key to paying down some of the burgeoning government debt. The UK is still mired in recession at a time when every other major global economy is growing again.
Government spending
Analysts said the overall level of public borrowing for this financial year was on track to hit the £178bn forecast by the government.Analysts said the overall level of public borrowing for this financial year was on track to hit the £178bn forecast by the government.
They also said that the deficit could improve slightly when VAT returns to 17.5% in January, boosting government tax revenues that have slumped during the recession.
Not only has the government received less money, it has also spent a lot more, largely on bailing out the banks and trying to stimulate the economy.
But despite the sharp increase in public borrowing, overall debt levels as a percentage of GDP are similar to those of other major, developed economies.