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| Version 1 | Version 2 |
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| Autumn Statement: Government borrowing forecast raised | Autumn Statement: Government borrowing forecast raised |
| (35 minutes later) | |
| The government is expected to borrow more money this year than had previously been predicted. | The government is expected to borrow more money this year than had previously been predicted. |
| The Office for Budget Responsibility (OBR) has raised its borrowing forecast for the current financial year from £86.6bn to £91.3bn, which is still below last year's total of £97.5bn. | The Office for Budget Responsibility (OBR) has raised its borrowing forecast for the current financial year from £86.6bn to £91.3bn, which is still below last year's total of £97.5bn. |
| The figure was announced in Chancellor George Osborne's Autumn Statement. | The figure was announced in Chancellor George Osborne's Autumn Statement. |
| The OBR also raised its forecast for economic growth this year from 2.7% to 3.0%, and from 2.3% to 2.4% next year. | The OBR also raised its forecast for economic growth this year from 2.7% to 3.0%, and from 2.3% to 2.4% next year. |
| The rise in the growth forecast brings the independent OBR into line with the consensus in the City, although it is still below the Bank of England's estimate. | The rise in the growth forecast brings the independent OBR into line with the consensus in the City, although it is still below the Bank of England's estimate. |
| While the OBR has raised its growth forecast for the next two years, it has cut it for the following three years. | While the OBR has raised its growth forecast for the next two years, it has cut it for the following three years. |
| Spending cuts | Spending cuts |
| The rise in the borrowing forecast is a result of the surprisingly low tax take. | The rise in the borrowing forecast is a result of the surprisingly low tax take. |
| Many analysts had been expecting the borrowing forecasts to rise by more because, as the chancellor conceded, "tax receipts have deteriorated" by more than the OBR had predicted. | Many analysts had been expecting the borrowing forecasts to rise by more because, as the chancellor conceded, "tax receipts have deteriorated" by more than the OBR had predicted. |
| Mr Osborne said the biggest factor keeping borrowing down was that the amount of interest being paid on the debt was lower than had been expected. | Mr Osborne said the biggest factor keeping borrowing down was that the amount of interest being paid on the debt was lower than had been expected. |
| But there were stark warnings from the OBR in its report accompanying the Autumn Statement of the amount of spending cuts still to come from the government. | But there were stark warnings from the OBR in its report accompanying the Autumn Statement of the amount of spending cuts still to come from the government. |
| It said that the government's overall plan for spending on public services was to reduce it from £5,650 per head in 2009-10 to £3,880 per head in 2019-20. | |
| The OBR warned that only about 40% of that cut would be made during the current Parliament, with the remaining 60% still to come in the next one. | The OBR warned that only about 40% of that cut would be made during the current Parliament, with the remaining 60% still to come in the next one. |
| "Total public spending is now projected to fall to 35.2% of GDP in 2019-20, taking it below the previous post-war lows reached in 1957-58 and 1999-00 to what would probably be its lowest level in 80 years." | "Total public spending is now projected to fall to 35.2% of GDP in 2019-20, taking it below the previous post-war lows reached in 1957-58 and 1999-00 to what would probably be its lowest level in 80 years." |
| The OBR also said: "Despite strong economic growth, the budget deficit is expected to fall by only £6.3bn this year to £91.3bn, around half the decline we expected in March. | The OBR also said: "Despite strong economic growth, the budget deficit is expected to fall by only £6.3bn this year to £91.3bn, around half the decline we expected in March. |
| "That would be the second smallest year-on-year reduction since its peak in 2009-10, despite this being the strongest year for GDP growth." | "That would be the second smallest year-on-year reduction since its peak in 2009-10, despite this being the strongest year for GDP growth." |
| In his response to the Autumn Statement, shadow chancellor Ed Balls said: "Over two years [Mr Osborne] has revised up borrowing by £12.5bn." | In his response to the Autumn Statement, shadow chancellor Ed Balls said: "Over two years [Mr Osborne] has revised up borrowing by £12.5bn." |
| "This means the chancellor will have borrowed in this Parliament £219bn more than he planned in 2010." | "This means the chancellor will have borrowed in this Parliament £219bn more than he planned in 2010." |
| Inflation forecast | Inflation forecast |
| The increase in the borrowing forecast had been expected because the government borrowed £64.1bn in the first seven months of the financial year, an increase of £3.7bn from the same period last year. | The increase in the borrowing forecast had been expected because the government borrowed £64.1bn in the first seven months of the financial year, an increase of £3.7bn from the same period last year. |
| The forecast for borrowing next year has been raised from £68.7bn to £75.9bn, but the predictions for the years after that have improved. | The forecast for borrowing next year has been raised from £68.7bn to £75.9bn, but the predictions for the years after that have improved. |
| The OBR expects inflation measured by the consumer prices index (CPI) of 1.5% this year, 1.2% next year and 1.7% the year after. It had previously said that CPI would only fall slightly below the Bank of England's forecast rate of 2.0% this year before returning to that level. | The OBR expects inflation measured by the consumer prices index (CPI) of 1.5% this year, 1.2% next year and 1.7% the year after. It had previously said that CPI would only fall slightly below the Bank of England's forecast rate of 2.0% this year before returning to that level. |
| The latest figures from the Office for National Statistics (ONS) show that the interest paid on government debt in the year to the end of October came in at £49.2bn, down from £50.4bn in the previous 12 months, despite rising debt. | The latest figures from the Office for National Statistics (ONS) show that the interest paid on government debt in the year to the end of October came in at £49.2bn, down from £50.4bn in the previous 12 months, despite rising debt. |
| Lower inflation forecasts also mean the government expects to have to make lower welfare payments and lower uprating on public sector pensions. | Lower inflation forecasts also mean the government expects to have to make lower welfare payments and lower uprating on public sector pensions. |
| Some analysts had also suggested that the point at which the government finances moves into surplus could be delayed by a year, but in fact the surplus for 2018-19 has only been reduced from £5bn to £4bn, with a surplus of £23bn predicted for 2019-20. | Some analysts had also suggested that the point at which the government finances moves into surplus could be delayed by a year, but in fact the surplus for 2018-19 has only been reduced from £5bn to £4bn, with a surplus of £23bn predicted for 2019-20. |