The British government borrowed 22 billion pounds in November due to the energy crisis – Business Live | Business

Martin Beck, chief economic adviser at the EY ITEM Club, said the ONS was a “first indicative estimate” of the cost of energy bills for households and businesses. Economic forecaster.

The November record “is mainly due to the government’s energy support programs,” he said.

The figures so far suggest that borrowing could actually reduce the OBR’s full-year forecast by £177bn, Beck said. But he added:

Given the uncertainty in the future path of energy prices – and therefore the value of energy price guarantees – and the lack of monthly OBR forecasts, confidence is therefore impossible.

The £500 increase in energy price guarantee from next April and the government’s decision not to continue universal support for households and businesses means energy support schemes should be much smaller in the 2023-24 financial year. Therefore, the EY ITEM Club expects that public sector borrowing should continue to decline beyond the fiscal year.

Jeremy Hunt has many important public finance decisions ahead, says the Institute of Chartered Accountants (ICAEW). At the very least: What support is there going to be for businesses after April?

Alison RingDirector of Public Sector and Taxation b ICAEWHe expressed concern over the low level of investment so far compared to 2021. The ONS said net investment in the first 11 months of 2022 was £34.4bn, which was £1bn less than last year.

She said:

Chancellor Jeremy Hunt will be relieved that the Office for Budget Responsibility’s latest £177bn forecast for the full year is just £5bn higher than £100bn.

The continued slowdown in public capital investment will add to the disruption of industrial activity, given its importance to economic growth prospects and future tax revenues.

We are pleased that the Chancellor will announce the Autumn Budget and accompanying Independent Fiscal Forecast on 15 March 2023, which will be the first official Budget for 18 months. However, it is important that HM Treasury approves the extension of the Energy Bill Relief scheme from April 2023 as soon as possible, as waiting until March may be too late for many businesses trying to figure out if they can take effect in 2023.

The UK government’s borrowing of £22bn in November was significantly higher than the £13bn expected by economists polled by Reuters.

He said there are several policy decisions that are all working together to increase credit Samuel GravesChief UK Economist at Pantheon MacroeconomicsCounselor.

Public borrowing was boosted by government labor and cost-of-living interventions in November, the decision to reverse April’s national insurance hike and higher inflation.

The Energy Bills Support Scheme cost the government £1.9bn in November, while the Energy Price Guarantee was the main driver of the £4.7bn subsidy increase over the year. In addition, social assistance payments were £3.3bn higher than a year earlier, reflecting the second cost of living increase for working age benefit recipients.

Divya Sridharan economist at PwCThe accounting firm said:

Looking ahead, continued support for energy bills and the ninth consecutive interest rate hike announced by the Bank of England last week will continue to weigh on public finances. The Office for Budget Responsibility (OBR) has revised its borrowing forecast down to £64.2bn in the 2022-23 financial year and £39.8bn in 2023-24 from its outlook for Q1 2022.

In the medium term, however, with a recovering economy and rising taxes, the OBR expects net government debt as a percentage of GDP to remain close to 100% of GDP until 2025-26 before starting to fall.

Not long ago on public finance, but today it looks like a fairly mild opening on European stock markets.

Business trading in the days leading up to Christmas is subdued for obvious reasons. The opening bid sent the FTSE 100 up 0.2%.

Here are the opening remarks from the European market, via Reuters:

• Europe’s Stoxx 600 .STOXX up 0.3%

• France’s CAC 40 up 0.2%, Spain’s IBEX UP 0.4%

• EURO STOXX INDEX UP 0.2%; Eurozone blue chips up 0.2%

• German Dachs 0.4%

Chancellor Jeremy Hunt confirmed his position that the United Kingdom is facing “tough decisions” to reduce public debt.

An increase in borrowing (with large but unspecified tax cuts) was one of the key factors in the removal of Liz Truss and Kwasi Kwarteng as prime minister and chancellor in October, less than two months apart. Hunt has stepped in to steady the ship – a task that will require a deficit-reduction program to rival the first years of a Conservative government.

Hunting He said on Wednesday.

In the wake of the twin global emergencies in Ukraine and Putin’s war, we have taken decisive action to support millions of businesses and families in the UK.

We have a clear plan to help halve inflation next year, but this will require some tough decisions to put our public finances on a sustainable footing.

The UK government borrowed a record £22bn in November.