21/10/11

  • Public sector borrowing in September 2011 was £14.1bn, compared with £15.4bn in September 2010

Commenting on the public sector finance figures for September, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:

“The borrowing figures for September were lower than expected, and the overall position in the first six months of the current financial year is better than many believed it would be. With UK economic growth likely to remain much weaker over the next few quarters than the OBR predicted in March, it is still possible that the government will overshoot its borrowing target for the year. In our September forecast we predicted a small excess of £5bn, but such a deviation should not give undue concern given the state of the economy.

“Making allowances for these factors, we believe the fiscal strategy remains on course, and it is important for the government to persevere with the task of cutting the deficit and stabilising Britain’s public finances. At the same time, there is a case for reallocating priorities within the overall plan to strengthen growth-supporting policies to help businesses grow and invest. There is considerable flexibility within the fiscal programme and this should allow the government to support more infrastructure investment. On its part, the MPC should maintain low interest rates and supplement its QE programme with measures aimed at boosting the availability of credit to businesses.”

Ends

Notes to editors:

ONS: http://www.ons.gov.uk/ons/rel/psa/public-sector-finances/september-2011/index.html

The British Chambers of Commerce (BCC) is the national voice of local business.

The BCC sits at the heart of a powerful nationwide network of Accredited Chambers of Commerce, serving over 100,000 businesses across the UK, which employ over five million people.

Media contacts:

Liz Larvin
Tel: 020 7654 5813 / 07825746812
Email: l.larvin@britishchambers.org.uk

Lisa Morrison
Tel: 020 7654 5812 / 07717682221
Email: l.morrison@britishchambers.org.uk