The UK is borrowing less than expected in October, but the worst is yet to come

Written by Andy Bruce

LONDON (Reuters) – The British state borrowed less than expected in October, according to data released on Tuesday, although the budget deficit is likely to rise in coming months thanks to measures to support the energy bill and a slowing economy. Economie.

The National Statistics Office said net public sector borrowing reached 13.549 billion Egyptian pounds ($16 billion) last month.

A Reuters poll of economists had pointed to a higher reading of 22 billion pounds, largely because the figures were expected to show large down payments under government energy bill subsidies to households and energy providers.

Tuesday’s data showed a relatively modest £3.4bn of “other” subsidies, a preliminary estimate referring to measures to support the energy bill.

This figure excluded the plan to reduce energy bills for companies, as estimates were not yet available, according to the National Statistics Office.

The full cost of these measures will emerge in the coming months, said Samuel Tombs, chief UK economist at consultancy Pantheon Macroeconomics.

“In addition, the decline in GDP will begin to slow the pace of tax revenue growth and will put some upward pressure on welfare spending at the end of the current fiscal year,” he said.

Last week, the Office for Budget Responsibility, which makes projections on which state budgets are based, said Thursday that the economy was already in recession and would contract by 1.4% in 2023.

($1 = £0.8447) (Reporting by Andy Bruce; Editing in Spanish by Flora Gomez)

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