Other commentary from the latest public sector finances data can be found on the following pages:
- Recent and upcoming changes to public sector finance statistics: April 2021
- UK government debt and deficit: December 2020
Public sector net borrowing (excluding public sector banks, PSNB ex) is estimated to have been £31.7 billion in April 2021; this is the second highest April borrowing since monthly records began in 1993, £15.6 billion less than in April 2020.
Provisional April 2021 estimates of central government receipts were £58.0 billion, up £3.8 billion (or 7.0%) compared with April 2020, while central government bodies spent £95.9 billion, down £12.9 billion (or 11.9%) from April 2020.
Public sector net borrowing (PSNB ex) in the financial year ending (FYE) March 2021 is estimated to have been £300.3 billion, revised down by £2.8 billion from last month’s first provisional estimate but remains the highest borrowing since financial year records began in FYE March 1946.
Expressed as a ratio of gross domestic product (GDP), public sector net borrowing (PSNB ex) in FYE March 2021 was 14.3%, revised down by 0.2 percentage points from last month’s first provisional estimate; it remains the highest such ratio since the end of World War Two, when it was 15.2% in FYE March 1946.
Public sector net borrowing (PSNB ex) in FYE March 2021 is estimated to have been £27.1 billion less than the £327.4 billion expected by the Office for Budget Responsibility (OBR) in their Economic and Fiscal outlook – March 2021 on a like for like basis.
Public sector net debt (excluding public sector banks, PSND ex) was £2,171.1 billion at the end of April 2021 or around 98.5% of GDP, the highest ratio since the 99.5% recorded in March 1962.
Central government net cash requirement (excluding UK Asset Resolution Ltd and Network Rail) was £30.5 billion in April 2021; the total for FYE March 2021 was £334.5 billion, substantially more than in any other financial year period since records began in FYE March 1984.
In April 2021, the public sector spent more than it received in taxes and other income requiring it to borrow £31.7 billion, £15.6 billion less than in April 2020 but still the second highest April borrowing on record.
|Central Government Net Borrowing||54.6||37.9||-16.7|
|Local Government Net Borrowing||-10.2||-5.0||5.2|
|Public Corporations Net Borrowing||0.2||0.2||0.0|
|Public Sector Pensions Net Borrowing||-0.1||-0.1||0.0|
|Sub-total: Public Sector Net Borrowing ex BoE and Banks||44.5||33.0||-11.5|
|Bank of England Net Borrowing||2.8||-1.3||-4.2|
|Sub-total: Public Sector Net Borrowing ex¹||47.3||31.7||-15.6|
|Public Sector Banks Net Borrowing||-0.7||-0.7||0.0|
|Total: Public Sector Net Borrowing||46.6||31.0||-15.6|
Download this table Table 1: Public sector net borrowing.xls .csv
The figures for the latest month of every release contain some forecast data. The initial outturn estimates for the early months of the financial year, particularly April, contain more forecast data than other months, as profiles of tax receipts, along with departmental and local government spending are still provisional. This means that the data for these months are typically more prone to revision than other months and can be subject to sizeable revisions in later months.
This may be more pronounced in FYE March 2022 than previous years for central government spending as a new HM Treasury administrative system, used to collect the data, is being introduced from June 2021. As with all system changes there is a risk that the outputs will be less stable in the initial stages. We are working with HM Treasury to minimise the impact of this change on these statistics.
Analysis of the components of borrowing in April 2021
Central government is the largest sub-sector of the public sector and therefore changes in central government receipts and expenditure usually have the most influence on public sector net borrowing. Public sector finances tables 1 to 10: Appendix A provide further information.
Central government receipts
Central government receipts were estimated to have increased by £3.8 billion in April 2021 compared with April 2020 to £58.0 billion, including £42.5 billion in tax receipts.
|Value Added Tax||11.1||12.1||1.0||8.8|
|Stamp Duty (L&P)¹||0.7||1.1||0.5||70.8|
|Other taxes on production||2.8||3.0||0.2||7.1|
|Pay As You Earn Income Tax||12.8||14.9||2.1||16.4|
|Self-Assessed Income Tax||-0.8||0.2||0.9||-|
|Other Taxes on Income & wealth²||-0.1||0.5||0.6||-|
|Compulsory social contributions||11.2||11.5||0.3||2.7|
|Interest & Dividends receipts||4.6||0.9||-3.7||-81.0|
|Total Current Receipts||54.2||58.0||3.8||7.0|
Download this table Table 2: Central government current receipts.xls .csv
In the most recent months, tax receipts recorded on an accrued (or national accounts) basis are always subject to some uncertainty, as many taxes such as Value Added Tax (VAT), Corporation Tax and Pay As You Earn (PAYE) Income Tax contain some forecast cash receipts data and are liable to revision when actual cash receipts data are received. The period of uncertainty is longer for taxes with coronavirus deferral schemes, such as VAT, and data for these taxes will be provisional for longer than usual.
The data used to inform receipts on a national accounts basis are largely consistent with the Office for Budget Responsibility (OBR) Economic and fiscal outlook – March 2021 published on 3 March 2021. Where necessary, and if there is sufficient information, further adjustments are made to estimate the impact of the coronavirus (COVID-19) pandemic.
Further details of the methods used to estimate the effect of the coronavirus on receipts were provided in Section 12 of Public sector finances, UK: March 2021. There have been no new methodology adjustments this month.
Central government expenditure
Central government bodies spent £95.9 billion in April 2021, £12.9 billion less than in April 2020.
|National Insurance Fund Benefits||9.3||9.6||0.3||2.8|
|Other Net social Benefits||0.9||0.9||0.0||0.0|
|Transfers to Local Government||28.4||16.7||-11.6||-41.0|
|Contributions to EU||1.1||0.0||-1.1||-|
|Total Current Expenditure||99.4||83.9||-15.5||-15.6|
Download this table Table 3: Central government expenditure.xls .csv
Interest payments on debt by central government
Interest payments on central government debt were £5.2 billion in April 2021, £0.1 billion more than in April 2020. Changes in debt interest are largely a result of movements in the Retail Prices Index to which index-linked bonds are pegged.
Central government expenditure on procurement and pay
Central government departments spent £31.0 billion on goods and services in April 2021, including £16.8 billion on procurement and £12.8 billion in pay. This cost includes the expenditure by the Department of Health and Social Care (DHSC), devolved administrations, and other departments in response to the coronavirus pandemic, including the NHS Test and Trace programme and the cost of vaccines.
Transfers to local government
Central government current transfers to local government were £16.7 billion in April 2021, £11.6 billion lower than in April 2020. In part, these payments enable local authorities to fund coronavirus policies.
Current and capital transfers between central government and local government are based on administrative data supplied by HM Treasury and have no impact at the public sector level.
Contributions to the EU
Many of the UK’s regular monthly payments to the EU stopped with effect from January 2021, while others are ending. This month, the UK did not record any of its regular VAT and gross national income-based contributions to the EU budget. Decisions on the recording of future payments such as those outlined in the Withdrawal Agreement will be made in due course.
Subsidies paid by central government
Central government paid £7.5 billion in subsidies to businesses and households in April 2021, £5.9 billion less than in April 2020. These payments included the cost of the job furlough schemes.
CJRS payments on an accrued basis for the period March 2020 to March 2021 are based on HM Revenue and Customs (HMRC) estimates, while the April 2021 amount is based on the OBR’s latest estimates. SEISS payments are currently recorded on a cash basis, reflecting HMRC coronavirus statistics.Nôl i'r tabl cynnwys
In the financial year ending (FYE) March 2021 (April 2020 to March 2021), the public sector borrowed £300.3 billion, £243.1 billion more than in the same period last year.
|Central Government Net Borrowing||56.3||309.8||253.5|
|Local Government Net Borrowing||6.7||-5.3||-12.0|
|Public Corporations Net Borrowing||-0.7||1.9||2.6|
|Public Sector Pensions Net Borrowing||-0.8||-1.0||-0.2|
|Sub-total: Public Sector Net Borrowing ex BoE and Banks||61.5||305.4||243.9|
|Bank of England Net Borrowing||-4.3||-5.1||-0.8|
|Sub-total: Public Sector Net Borrowing ex¹||57.2||300.3||243.1|
|Public Sector Banks Net Borrowing||-8.7||-8.8||-0.1|
|Total: Public Sector Net Borrowing||48.5||291.5||243.0|
Download this table Table 4: Public Sector Net Borrowing.xls .csv
Analysis of the components of borrowing in FYE March 2021
Borrowing had generally been falling since its peak of £157.7 billion during the economic downturn in FYE March 2010. However, largely as a result of the impact of the coronavirus pandemic, the £300.3 billion borrowed in FYE March 2021 was nearly double this previous record.
Central government receipts
Central government receipts were estimated to have fallen by £31.8 billion (or 4.2%) in FYE March 2021 compared with FYE March 2020 to £724.9 billion (including £525.5 billion in tax receipts). Much of this fall occurred in the first half of the financial year (April to September), with the second half of the year showing some signs of recovery.
|Value Added Tax||152.7||138.7||-14.0||-9.2|
|Stamp Duty (L&P)¹||12.5||9.5||-3.0||-24.2|
|Other taxes on production||40.3||35.8||-4.5||-11.2|
|Pay As You Earn Income Tax||165.2||169.3||4.1||2.5|
|Self-Assessed Income Tax||32.0||31.9||-0.1||-0.4|
|Other Taxes on Income & wealth³||6.3||8.1||1.8||28.6|
|Compulsory social contributions||145.0||144.5||-0.5||-0.3|
|Interest & Dividends receipts||18.1||19.4||1.3||7.1|
|Total Current Receipts||756.7||724.9||-31.8||-4.2|
Download this table Table 5: Central government current receipts.xls .csv
Central government expenditure
In FYE March 2021, central government support for individuals and businesses during the pandemic contributed to an increase of £204.1 billion (or 27.6%) in central government day-to-day (or current) spending when compared with FYE March 2020.
|National Insurance Fund Benefits||108.8||115.5||6.7||6.2|
|Other Net social Benefits||4.2||2.1||-2.1||-50.0|
|Transfers to Local Government||114.6||149.8||35.1||30.6|
|Contributions to EU||11.6||10.9||-0.6||-5.3|
|Total Current Expenditure||738.6||942.7||204.1||27.6|
Download this table Table 6: Central government expenditure.xls .csv
Transfers to local government
Central government current transfers to local government were £149.8 billion in FYE March 2021, £35.1 billion higher than in FYE March 2020, with much of this increase to enable local authorities to fund coronavirus policies.
Some coronavirus-related current grants that have been paid by central to local government have either not been spent, or have not yet been fully reflected in our estimates of local government spending.
Subsidies paid by central government
Central government paid £117.3 billion in subsidies to businesses and households in FYE March 2021, £94.8 billion more than in FYE March 2020. This includes the £58.1 billion cost of the Coronavirus Job Retention Scheme (CJRS) and the £19.7 billion cost of the Self Employment Income Support Scheme (SEISS).Nôl i'r tabl cynnwys
The central government net cash requirement (CGNCR), excluding UK Asset Resolution Ltd and Network Rail, is the amount of cash needed immediately for the UK government to meet its obligations. To obtain cash, the UK government sells financial instruments, gilts or Treasury Bills.
The amount of cash required will be affected by changes in the timing of tax payments by individuals and businesses but does not depend on forecast tax receipts in the same way as our accrued (or national accounts) based measures.
The CGNCR consequently contains the most timely information and is less susceptible to revision than other statistics in this release. However, as for any cash measure, the CGNCR does not reflect the overall amount for which the government is liable or the point at which any liability is incurred – it only reflects when cash is received and spent.
Tables 7 and 8 demonstrate how CGNCR is calculated from cash receipts and cash outlays. This presentation focuses on the central government’s own account and excludes cash payments to both local government and public non-financial corporations.
|HMRC Receipts: Total paid over¹||32.7||54.1||21.3||65.2|
|HMRC Receipts: Income tax²||14.6||18.9||4.4||29.9|
|HMRC Receipts: NICs³||11.0||13.3||2.3||20.6|
|HMRC Receipts: VAT⁴||-0.9||14.7||15.6||-|
|HMRC Receipts: Corporation tax⁵||3.7||2.8||-0.8||-22.7|
|Interest & Dividends Receipts||4.5||0.8||-3.7||-82.4|
|Total Cash Receipts||38.6||57.8||19.1||49.6|
|Net Acquisition of Company Securities⁷||0.0||0.0||0.0||-|
|Net Department Outlays: Total⁸||91.4||86.6||-4.8||-5.2|
|Net Department Outlays: CJRS⁹||5.2||3.2||-1.9||-37.5|
|Net Department Outlays: SEISS¹⁰||0.0||2.5||2.5||-|
|Total Cash Outlays||102.2||88.2||-14.1||-13.7|
|Own account Net Cash Requirement ex¹¹||63.6||30.4||-33.2||-52.2|
|NRAM and B&B||0.0||0.0||0.0||-83.3|
|Own account Net Cash Requirement¹²||63.6||30.4||-33.2||-52.2|
Download this table Table 7: Central government net cash requirement on own account.xls .csv
|HMRC Receipts: Total paid over¹||602.2||556.0||-46.2||-7.7|
|HMRC Receipts: Income tax²||203.1||206.4||3.4||1.7|
|HMRC Receipts: NICs³||142.9||142.7||-0.1||-0.1|
|HMRC Receipts: VAT⁴||129.7||101.0||-28.7||-22.2|
|HMRC Receipts: Corporation tax⁵||63.7||52.2||-11.5||-18.0|
|Interest & Dividends Receipts||18.6||19.7||1.2||6.3|
|Total Cash Receipts||652.0||609.7||-42.3||-6.5|
|Net Acquisition of Company Securities⁷||-4.3||-5.6||-1.3||-29.1|
|Net Department Outlays: Total⁸||668.2||905.5||237.3||35.5|
|Net Department Outlays: CJRS⁹||0.0||58.0||58.0||-|
|Net Department Outlays: SEISS¹⁰||0.0||19.7||19.7||-|
|Total Cash Outlays||699.8||944.4||244.6||35.0|
|Own account Net Cash Requirement ex¹¹||47.7||334.7||286.9||601.0|
|NRAM and B&B||0.1||4.5||4.5||6,475.4|
|Own account Net Cash Requirement¹²||48.0||339.4||291.4||607.2|
Download this table Table 8: Central government net cash requirement on own account.xls .csv
Public sector net debt represents the amount of money the public sector owes to private sector organisations (including overseas institutions). When the government borrows, this normally adds to the debt total, but it is important to remember that reducing borrowing (the deficit) is not the same as reducing the debt.
Public sector net debt (excluding public sector banks, PSND ex) stood at £2,171.1 billion at the end of April 2021, an increase of £304.6 billion on a year earlier.
Over the course of the coronavirus (COVID-19) pandemic, the increase in debt combined with a fall in gross domestic product (GDP) have all helped push public sector net debt as a ratio of GDP to levels last seen in the early 1960s, with debt as a ratio of GDP currently standing at 98.5% at the end of April 2021.
Central government gilts
Debt represents the amount of money owed by the public sector to the private sector and is largely made up of gilts (or bonds) issued to investors by central government.
There was £1,888.3 billion of central government gilts in circulation at the end of April 2021 (including those held by the Bank of England (BoE) Asset Purchase Facility Fund).
These gilts are auctioned by the Debt Management Office (DMO), on behalf of central government in accordance with its financing remit.
Other financial instruments
On 25 March 2021, the UK government issued £500 million in its second sovereign Sukuk sale, which added an equivalent amount to central government gross debt, from April 2021.
The Sharia compliant bond has a long five-year maturity (22 July 2026) and, as with the UK’s first Sukuk issue (matured 22 July 2019), employs the commonly used Al-ljara structure.
The Bank of England’s contribution to debt
The Bank of England’s (BoE) contribution to debt is largely a result of its quantitative easing activities through the BoE Asset Purchase Facility (APF) Fund and Term Funding Schemes (TFS).
If we were to remove the temporary debt impact of these schemes along with the other transactions relating to the normal operations of the BoE, public sector net debt excluding public sector banks (PSND ex) at the end of April 2021 would reduce by £224.6 billion (or 10.2 percentage points of GDP) to £1,946.4 billion (or 88.3% of GDP).
The estimated impact of the APF’s gilt holdings on debt currently stands at £115.1 billion, representing the difference between the value of the reserves created to purchase gilts (or market value of the gilts) and the £676.8 billion face (or redemption) value of the gilts purchased.
The total corporate bond holdings of the APF at the end of April 2021 stood at £19.8 billion, adding an equivalent amount to the level of debt.
The TFS loan liability stood at £28.3 billion and the TFSME loan liability stood at £80.7 billion at the end of April 2021, making a combined liability of £109.0 billion, adding an equivalent amount to the level of debt.
Assets purchased under the TFS and TFSME fall outside the boundary of public sector net debt excluding public sector banks (PSND ex). Those users who are interested in wider measures of the public sector balance sheet may find estimates of public sector net financial liabilities (PSNFL) of interest.Nôl i'r tabl cynnwys
The data for the latest months of every release contain a degree of forecasts; subsequently, these are replaced by improved forecasts as further data are made available and finally by outturn data.
The coronavirus (COVID-19) pandemic has had a substantial impact on both tax receipts and expenditure. These impacts are likely to be revised further as the full effects of the coronavirus pandemic on the public finances continue to become clearer.
Revisions to net borrowing in the financial year ending (FYE) March 2021
Since our last publication (23 April 2021), we have reduced our estimate of borrowing in FYE March 2021 by £2.8 billion.
Improved data from our suppliers have increased our estimates of central government current receipts by £2.1 billion and our estimate of total central government expenditure by £1.5 billion.
Within this additional central government expenditure, grants to local government have increased by £2.3 billion. While this revision has contributed to an increase in central government borrowing, it has had an equal and opposite effect on the borrowing of local government.
|March||Full financial year²|
|Central Government Net Borrowing||33.5||33.7||0.1||310.5||309.8||-0.7|
|Local Government Net Borrowing||-4.0||-6.0||-1.9||-3.1||-5.3||-2.2|
|Public Corporations Net Borrowing||0.0||0.1||0.1||1.8||1.9||0.1|
|Public Sector Pensions Net Borrowing||-0.1||-0.1||0.0||-1.0||-1.0||0.0|
|Sub-total: Public Sector Net Borrowing ex|
BoE and Banks
|Bank of England Net Borrowing||-1.5||-1.5||0.0||-5.1||-5.1||0.0|
|Sub-total: Public Sector Net Borrowing ex¹||28.0||26.3||-1.7||303.1||300.3||-2.8|
|Public Sector Banks Net Borrowing||-0.7||-0.7||0.0||-8.8||-8.8||0.0|
|Total: Public Sector Net Borrowing||27.3||25.5||-1.7||294.3||291.5||-2.8|
Download this table Table 9: Revisions to public sector net borrowing.xls .csv
|March||Full financial year³|
|National Insurance Fund Benefits||9.6||9.8||0.1||115.4||115.5||0.1|
|Other Net social Benefits||-0.1||-0.2||-0.1||2.1||2.1||0.0|
|Transfers to Local Government||15.1||16.4||1.3||148.1||149.8||1.7|
|Contributions to EU||0.0||0.0||0.0||10.9||10.9||0.0|
|Total Current Expenditure||84.7||85.6||1.0||941.7||942.7||1.0|
Download this table Table 10: Revisions to central government expenditure.xls .csv
|March||Full financial year²|
|Value Added Tax||11.4||11.3||-0.1||138.7||138.7||-0.1|
|Stamp Duty (L&P)¹||1.3||1.3||0.0||9.5||9.5||0.0|
|Other Taxes on Production||3.5||3.4||-0.1||35.7||35.8||0.1|
|Pay As You Earn Income Tax||17.9||17.8||-0.1||169.5||169.3||-0.1|
|Self-Assessed Income Tax||1.2||1.2||0.0||31.9||31.9||0.0|
|Other Taxes on Income & wealth³||0.5||0.6||0.1||7.9||8.1||0.2|
|Compulsory social contributions||14.8||15.0||0.2||144.3||144.5||0.2|
|Interest & Dividends receipts||0.6||0.6||0.0||19.4||19.4||0.0|
|Total Central Government Current Receipts||65.1||66.3||1.2||722.8||724.9||2.1|
Download this table Table 11: Revisions to central government current receipts.xls .csv
Revisions to borrowing in earlier years
This month we have incorporated revisions to tax receipts data received from HM Revenue and Customs (HMRC).
As a result of work HMRC has undertaken to improve the quality of assurance activity on the data underpinning tax receipts statistics, errors affecting a number of taxes from FYE March 2016 to FYE March 2020 have been identified and corrected.
The receipts most affected by these revisions are VAT, National Insurance contributions, fines and penalties and Income Tax.
Further information on these cash revisions can be found in the associated HMRC tax receipts statistics publication HMRC tax receipts and National Insurance contributions for the UK (25 May 2021).
The consequential impact of these changes to net borrowing over this five-year period ranges between an increase of £0.4 billion in FYE March 2016 and a reduction of £0.9 billion in FYE March 2018.
Further, we have updated our estimates of fines received by central government. We have reduced our previous estimates by £0.5 billion and £0.2 billion in FYE March 2017 and FYE March 2018 respectively. In reducing government receipts in these periods, we have increased borrowing by a corresponding amount.
The revisions to the components of central government borrowing are summarised in Public sector finances tables 1 to 10: Appendix A.
Revisions to public sector net debt
This month we have reduced our previous estimate of the level of debt at the end of March 2021 by £4.2 billion from that published on 23 April 2021. This change is largely a result of updates to our estimate of the Bank of England’s contribution to net debt, which we have reduced by £3.7 billion in March 2021.
We have updated our gross domestic product (GDP) estimates to incorporate GDP first quarterly estimate, UK: January to March 2021 (12 May 2021), leading to small revisions to our previous estimate of debt expressed as a ratio of GDP.
The revisions to our debt aggregates are presented in Public sector finances tables 1 to 10: Appendix A.
Revisions to data for public sector banks
This month we have received balance sheet data for public sector banks for the period July to December 2020. This has enabled us to replace our provisional estimates, reducing net debt by £9.7 billion at the end of March 2021.Nôl i'r tabl cynnwys
Public sector finances borrowing by sub-sector
Dataset | Released 25 May 2021
An extended breakdown of public sector borrowing in a matrix format and estimates of total managed expenditure (TME).
Public sector finances tables 1 to 10: Appendix A
Dataset | Released 25 May 2021
The data underlying the public sector finances statistical bulletin are presented in the tables PSA 1 to 10.
Public sector finances revisions analysis on main fiscal aggregates: Appendix C
Dataset | Released 25 May 2021
Revisions analysis for central government receipts, expenditure, net borrowing and net cash requirement statistics for the UK over the last five years.
Public sector current receipts: Appendix D
Dataset | Released 25 May 2021
A breakdown of UK public sector income by latest month, financial year-to-date and full financial year, with comparisons with the same period in the previous financial year.
International Monetary Fund’s Government Finance Statistics framework in the public sector finances: Appendix E
Dataset | Released 25 May 2021
Presents the balance sheet, statement of operations and statement of other economic flows for public sector compliant with the Government Finance Statistics Manual 2014: GFSM 2014 presentation.
HMRC tax receipts and National Insurance contributions for the UK
Dataset | Released 25 May 2021
Summary of HM Revenue and Customs (HMRC) tax receipts, National Insurance contributions (NICs), tax credit expenditure and Child Benefit for the UK on a cash basis.
In the UK, the public sector consists of six sub-sectors: central government, local government, public non-financial corporations, public sector pensions, the Bank of England (BoE) and public financial corporations (or public sector banks).
Public sector current expenditure
Current expenditure measures reflect the cost of the public sector’s day-to-day activities. For example, in the case of central government these include:
- providing services and grants (for example, related to education, defence, and health and social care) – including the current job furlough schemes
- payment of social benefits (such as pensions, unemployment payments, Child Benefit and Statutory Maternity Pay)
- payment of the interest on the government’s outstanding debt
Public sector debt interest to revenue ratio
The debt interest to revenue ratio (DIR) represents the proportion of net interest paid (gross interest paid less interest received) by the public sector (excluding public sector banks), compared with the non-interest receipts it receives in a given period.
Public sector current budget deficit
Public sector current budget is the difference between revenue (mainly from taxes) and current expenditure, on an accrued (or national accounts) basis; it is the gap between current expenditure and current receipts (having taken account of depreciation). The current budget is in surplus when receipts are greater than expenditure.
Public sector net investment
Public sector net investment is the sum of all capital spending, mainly net acquisitions of capital assets and capital grants, less the depreciation of the stock of capital assets.
Public sector net borrowing
Public sector net borrowing excluding public sector banks (PSNB ex) measures the gap between revenue raised (current receipts) and total spending (current expenditure plus net investment (capital spending less capital receipts)). PSNB is often referred to by commentators as “the deficit”.
Public sector net cash requirement
The public sector net cash requirement (PSNCR) represents the cash needed to be raised from the financial markets over a period of time to finance the government’s activities. This can be close to borrowing (the deficit) for the same period; however, there are some transactions, for example, loans to the private sector, that need to be financed but do not contribute to the deficit. It is also close but not identical to the changes in the level of net debt between two points in time.
Public sector net debt
Public sector net debt excluding public sector banks (PSND ex) represents the amount of money the public sector owes to private sector organisations including overseas institutions, largely as a result of issuing gilts and Treasury Bills, minus the amount of cash and other short-term assets it holds. PSND is often referred to by commentators as “the national debt”.
Public sector banks
Unless otherwise stated, the figures quoted in this bulletin exclude public sector banks (that is, currently only Royal Bank of Scotland, RBS). The reported position of debt, and to a lesser extent borrowing, would be distorted by the inclusion of RBS’ balance sheet (and transactions). This is because the government does not need to borrow to fund the debt of RBS, nor would surpluses achieved by RBS be passed on to the government, other than through any dividends paid as a result of the government equity holdings.
Other important terms commonly used to describe public sector finances are listed in the Public sector finances glossary.Nôl i'r tabl cynnwys
The Monthly statistics on the public sector finances: a methodological guide provides comprehensive contextual and methodological information concerning the monthly public sector finances statistical bulletin. The guide sets out the conceptual and fiscal policy context for the bulletin, identifies the main fiscal measures, and explains how these are derived and interrelated.
More quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in the Public sector finances QMI.
Comparisons with official forecasts
The independent Office for Budget Responsibility (OBR) is responsible for the production of official forecasts for the government. These forecasts are usually produced twice a year, in both spring and autumn.
|£ billion unless otherwise stated (not seasonally adjusted)|
|April to March outturn 2020-21||Full financial year forecast¹ 2020-21||Difference from outturn to forecast||Full financial year forecast 2021-2022|
|Net Debt % of GDP³||97.4||100.2||-2.8||107.4|
Download this table Table 12: Latest public sector finances outturn figures compared with official OBR forecasts for the financial year ending March 2021, UK.xls .csv
Estimating monthly gross domestic product (GDP)
Estimates of GDP used to present debt and other headline measures are partly based on provisional and official forecast data. Our April 2021 estimate of monthly GDP requires data across five quarters of GDP. Of these, two are based on the latest data published by the Office for National Statistics (ONS) (12 May 2021) and three are based on the latest official forecasts published by OBR (3 March 2021).
Local government and public corporations
Both local government and public corporations’ data in the most recent periods are initial estimates, largely based on the Budget Responsibility (OBR) Economic and fiscal outlook (EFO) – March 2021, with adjustments being applied as needed.
In recent years, planned expenditure initially reported in local authority budgets has been systematically higher than the final outturn expenditure reported in the audited accounts. We therefore include adjustments, usually to reduce the amounts reported at the budget stage.
For FYE 2020, we include a £0.2 billion downward adjustment to Wales’ capital expenditure.
For FYE 2021 we include:
- a £4.6 billion downward adjustment to England’s capital expenditure
- a £0.7 billion downward adjustments to Scotland’s capital expenditure
- a £0.2 billion downward adjustments to Wales’ capital expenditure
- an £8.5 billion upward adjustment to England’s current expenditure on goods and services, as the budget forecasts on which these are based were prepared before the coronavirus pandemic
We apply a further £1.0 billion downward adjustment to budget forecast current expenditure on benefits in FYE 2021, to reflect the most recently available data for housing benefits.
End of EU exit transition period
As the UK enters into a new Trade and Cooperation Agreement with the EU, the UK statistical system will continue to produce and publish our wide range of economic and social statistics and analysis.
We are committed to continued alignment with the highest international statistical standards, enabling comparability both over time and internationally, and ensuring the general public, statistical users and decision makers have the data they need to be informed. This means that the statistics included in this release, and our sector classifications process, will continue to draw on the European System of Accounts (ESA) 2010 and the Manual on Government Deficit and Debt, and associated guides following the end of the transition period. We also intend to continue to produce the main fiscal aggregates that we have previously provided to Eurostat as part of the Excessive Deficit Procedure (EDP) process.
As the shape of the UK’s future statistical relationship with the EU becomes clearer over the coming period, the ONS is making preparations to assume responsibilities that as part of our membership of the EU, and during the transition period, were delegated to the statistical office of the EU, Eurostat. This includes responsibilities relating to international comparability of economic statistics, deciding what international statistical guidance to apply in the UK context and to provide further scrutiny of our statistics and sector classification decisions.
In applying international statistical standards and best practice to UK economic statistics, we will draw on the technical advice of experts in the UK and internationally, and our work will be underpinned by the UK’s well-established and robust framework for independent official statistics, set out in the Statistics and Registration Service Act 2007. Further information on our proposals will be made available later this year.Nôl i'r tabl cynnwys
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