“Today’s numbers show that taxes and other receipts fell short of public spending by £97bn in the seven months to 31 October, £15bn more than budgeted and £1bn more than in the same period in the previous financial year. This was the third highest cumulative total for October on record and took net debt to £2,792bn or 97.5% of GDP. This further emphasises the difficult financial situation that the government tried to address in last month’s Autumn Budget.
“The OBR’s revised estimate for the full year to March 2025 is for a shortfall of £127bn, £40bn more than budgeted, principally from the £22bn black hole in public spending identified by the incoming government and £16bn in extra debt interest.
“With the government’s growth agenda including planning reform and a fresh industrial strategy yet to be rolled out, let alone bear fruit, the Chancellor is almost entirely relying on her Autumn Budget tax rises to stabilise the fiscal situation from April 2025 onwards. This is likely to stiffen her resolve against calls for her to reverse course on some of her tax decisions.”
ENDS
Notes to editors:
CONTACT: ICAEW media office stephen.froome@icaew.com or 07970 402 073
- The reported monthly deficit in October 2024 of £17.4bn was £8.7bn higher than the £8.7bn budgeted back in March 2024 and £1.6bn more than the monthly deficit of £15.8bn in October 2023. This is the second highest monthly borrowing for October since records began.
- The cumulative deficit for the seven months ended 31 October 2024 of £96.6bn, was £14.9bn higher than the £81.7bn budgeted and £1.1bn more than the £95.5bn reported for the same period in 2023/24.
- Public sector net debt on 31 October 2024 was £2,792bn or 97.5% of GDP, which was £25bn more than budgeted, and £792bn more than at the start of the year.
- The £22bn ‘black hole’ identified by the Chancellor comprised £11.6bn in inflationary pressures on pay, £6.4bn for asylum and refugees, £2.9bn for additional rail subsidies, £2.6bn in unfunded policy commitments by the previous government, £1.7bn for Ukraine and £1.5bn for the NHS, less £4.8bn in unused reserve and other contingencies within the budget.