As always, how you look at borrowing depends on the measure you prefer – but by public sector net borrowing excluding financial interventions the deficit was slightly lower in August.
Down from £14.4bn to £13.2bn, that's a touch lower than expected.
Martin Beck, UK economist, Capital Economics:
The improvement was driven by a fall in central Government spending, which dropped by 2.2% y/y. Less pleasing was that receipts only rose by 1.4% on an annual basis, down from 2.4% (ex-APF transfers) in July. Nonethless, more good news is a downward revision to borrowing in 2012-13, from the previous estimate of £116.6bn to £115.7bn.
Note that, with the limit for central bank transfers that can be counted towards borrowing reached in July, August’s deficit was not distorted by income from the Bank’s Asset Purchase Facility. But even without the boost provided by this income, the public sector deficit could well be on course to decline more rapidly than the OBR expects.
And the borrowing stats in a variety of flavours from the statisticians:
In 2012/13, public sector net borrowing excluding temporary effects of financial interventions and also excluding the effects of the transfer of the Royal Mail Pension Plan and the transfers from the Bank of England Asset Purchase Facility Fund was £115.7 billion. This was £2.8 billion lower than in 2011/12.
In 2012/13, public sector net borrowing excluding temporary effects of financial interventions (PSNB ex) was £81.3 billion. This was £37.2 billion lower than in 2011/12 when it was £118.5 billion.
In August 2013, the £3.9 billion transferred from the Bank of England Asset Purchase Facility Fund to HMT Treasury did not reduce the public sector net borrowing excluding temporaryeffects of financial interventions (PSNB ex). There were not any special factors affecting public sector net borrowing in August 2012 or August 2013.
In August 2013, public sector net borrowing excluding temporary effects of financial interventions (PSNB ex) was £13.2 billion. This was £1.3 billion lower than in August 2012 when it was £14.4 billion.
Public sector net debt excluding temporary effects of financial interventions (PSND ex) was £1,193.3 billion at the end of August 2013, equivalent to 74.6% of gross domestic product (GDP).
The central government net cash requirement for the 2013/14 year to date was £26.4 billion, £3.8 billion lower than the same period in 2012/13.