The public finance figures for April-June blow a pretty big hole in Gordo's Budget projections. With June's borrowing figures the highest on record, the first quarter of the 2006-07 financial year was a disaster:
- Borrowing was up by £3.4bn compared to 2005-06- whereas the full year projections call for a £2bn fall
- Receipts were up, but only by 5.1% compared to a forecast of 6.2%
- Public spending is soaring - up by 8.4% compared to a forecast of 5.2%
Clearly it's spending doing the damage, so what's going on? The Treasury says it's simply a matter of timing- health and education spending is taking place a bit earlier this year, and it will all get clawed back later on.
What we really need to know is why should the timing change? Could it by any chance reflect desperate efforts at the end of the last financial year to keep spending down so as to prevent ballooning NHS deficits causing too many red faces among the Commissars? Spending that has been shunted into this financial year.
Because if that's the case, it means a big BIG problem for early 2007. And if you're planning to get sick you might want to do so well before then.
This is no way to run a modern art collection.
Picture: Whaam! by Roy Lichtenstein at Tate Modern