UK Borrowing Shows First Annual Fall since Start of Pandemic

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Britains massive public borrowing began to head downwards last month for the first time since the start of the COVID19 pandemic, bolstered by a brightening economic outlook that pointed to a potentially faster improvement in public finances.

Public sector net borrowing in April totalled 31.7 billion pounds 44.9 billion, official figures showed on Tuesday, down from a record 47.3 billion pounds a year earlier when the government finances felt the greatest impact of the pandemic.

Britains government has spent heavily over the past year on health measures to limit the impact of COVID19 as well as wage guarantees to stop unemployment rising significantly during the sharpest economic downturn in more than 300 years.

Borrowing in the 202021 financial year was 300.3 billion pounds or 14.3 of annual economic output, the highest share on this measure since the end of World War Two but slightly below an initial estimate a month ago.

British government forecasters predicted in early March that borrowing would fall to 10.3 of GDP this financial year.

However the growth outlook has improved since then thanks to a rapid rollout of COVID vaccines, and monthly borrowing has come in below government predictions, prompting some economists to see a faster improvement in the public finances.

The governments financial position isnt as bad as the Office for Budget Responsibility predicted only two months ago, reinforcing our view that the tax hikes and spending cuts that most fear may be…

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