Ruth Gregory, economist at Capital Economics, said: “February’s disappointing public finances figures suggest that the OBR’s new 2023-24 borrowing forecast already looks too optimistic.” “But this may not prevent the government from squeezing in another pre-election tax-cutting fiscal event later this year,” she added, based on the expectation that borrowing will fall faster beyond 2025-26 than current predictions.
Borrowing fell from last year on the back of more revenues from taxes, which were up 10 per cent. Gregory said the figures provided “evidence that tax receipts remained buoyant”.