Cynnwys
- Other pages in this release
- Main points
- The impact of the coronavirus on the public finances
- Borrowing in February 2021
- Central government net cash requirement
- Debt
- Revisions
- Public sector finances data
- Glossary
- Measuring the data
- Strengths and limitations
- Challenges of measuring the effects of the coronavirus pandemic on tax receipts
- Related links
1. Other pages in this release
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: February 2021
- UK government debt and deficit: September 2020
2. Main points
Public sector net borrowing (excluding public sector banks, PSNB ex) is estimated to have been £19.1 billion in February 2021, £17.6 billion more than in February 2020, which is the highest February borrowing since monthly records began in 1993.
Central government tax receipts are estimated to have been £46.2 billion in February 2021 (on a national accounts basis), £1.5 billion lower than in February 2020, with notable falls in taxes on production such as Value Added Tax (VAT), Business Rates and Fuel Duty.
Self-assessed Income Tax receipts were £4.2 billion in February 2021, £0.9 billion more than in February 2020; in the light of the government’s tax deferral policy, it is advisable to look at combined self-assessed Income Tax receipts across the whole financial year when drawing conclusions from year-on-year comparisons.
Central government bodies are estimated to have spent £72.6 billion on day-to-day activities (current expenditure) in February 2021, £14.2 billion more than in February 2020; this includes £3.9 billion expenditure on coronavirus job support schemes.
Public sector net borrowing (excluding public sector banks, PSNB ex) in the financial year-to-February 2021 is estimated to have been £278.8 billion, £228.2 billion more than in the same period last year and the highest public sector borrowing in any April to February period since records began in 1993.
Public sector net debt (excluding public sector banks, PSND ex) rose by £333.0 billion over the 11 months of the financial year-to-February 2021, taking it to £2,131.2 billion or around 97.5% of gross domestic product (GDP); maintaining a level not seen since the early 1960s.
Central government net cash requirement (excluding UK Asset Resolution Ltd and Network Rail) was £6.4 billion in February 2021, bringing the current financial year-to-February total to £313.8 billion, nearly double the highest cash requirement in any other April to February period since records began in 1984.
Our estimates expressed as a percentage of gross domestic product (GDP) are partially based on official projections, which means figures for recent periods are subject to revision, particularly considering the uncertain impacts of the coronavirus pandemic on the economy.
4. Borrowing in February 2021
In February 2021, the public sector spent more than it received in taxes and other income, requiring it to borrow £19.1 billion, £17.6 billion more than it borrowed in February 2020.
Each February, accrued receipts tend to be boosted by the late payment of self-assessed taxes, due in January of each year. Self-assessed Income Tax receipts were £4.2 billion in February 2021, £0.9 billion more than in February 2020.
Figure 3: The substantial increases in borrowing in recent months reflect the emerging effects of government coronavirus (COVID-19) policies
Public sector net borrowing excluding public sector banks, UK, the current financial year-to-date (April 2020 to February 2021) compared with the financial year ending March 2020 (April 2019 to March 2020)
Source: Office for National Statistics – Public sector finances
Download this chart Figure 3: The substantial increases in borrowing in recent months reflect the emerging effects of government coronavirus (COVID-19) policies
Image .csv .xlsTable 1 summarises the components of public sector net borrowing (excluding public sector banks) in February 2021 and compares them with the equivalent measures in the same month a year earlier. Additionally, the table presents estimates of the borrowing of public sector banks and the full public sector net borrowing measure.
Borrowing estimates in the current financial year (April 2020 to February 2021) are subject to more uncertainty than usual as a result of the challenges we face in collecting data during the coronavirus (COVID-19) pandemic.
£ billion | |||
---|---|---|---|
February 2020 | February 2021 | Change | |
Central Government Net Borrowing | -0.8 | 16.0 | 16.8 |
Local Government Net Borrowing | 3.4 | 4.4 | 1.0 |
Public Corporations Net Borrowing | -0.1 | 0.2 | 0.3 |
Public Sector Pensions Net Borrowing | -0.1 | -0.1 | 0.0 |
Sub-total: Public Sector Net Borrowing ex BoE and Banks | 2.5 | 20.6 | 18.1 |
Bank of England Net Borrowing | -0.9 | -1.4 | -0.5 |
Sub-total: Public Sector Net Borrowing ex¹ | 1.6 | 19.1 | 17.6 |
Public Sector Banks Net Borrowing | -0.7 | -0.7 | 0.0 |
Total: Public Sector Net Borrowing | 0.8 | 18.4 | 17.6 |
Download this table Table 1: Public Sector Net Borrowing
.xls .csvCentral government
Central government is the largest sub-sector of the public sector. Of the £19.1 billion net borrowing by the public sector (excluding public sector banks) in February 2021, £16.0 billion was borrowed by central government.
Central government receipts
In February 2021, central government receipts were estimated to have fallen by £0.9 billion compared with February 2020 to £63.2 billion, including £46.2 billion in tax receipts.
Figure 4: Central government receipts continue to lag behind the same period last year
Central government current receipts, UK, financial year-to-February 2021 compared with the financial year ending March 2020 (April 2019 to March 2020)
Source: Office for National Statistics – Public Sector Finances
Download this chart Figure 4: Central government receipts continue to lag behind the same period last year
Image .csv .xlsTable 2 summarises the components of central government receipts in February 2021 and compares them with the equivalent measures in the same month a year earlier.
£ billion | ||||
---|---|---|---|---|
February 2020 | February 2021 | Change | % change | |
Value Added Tax | 11.7 | 10.3 | -1.4 | -12.0 |
Fuel Duty | 2.3 | 1.6 | -0.7 | -31.3 |
Alcohol Duty | 0.6 | 0.9 | 0.3 | 53.2 |
Tobacco Duty | 0.8 | 0.8 | 0.0 | 2.0 |
Business Rates | 2.4 | 1.5 | -0.9 | -37.3 |
Stamp Duty (L&P)¹ | 0.9 | 0.8 | 0.0 | -4.5 |
Customs Duties | 0.0 | 0.3 | 0.3 | - |
Other taxes on production | 3.1 | 2.9 | -0.2 | -6.5 |
Pay As You Earn Income Tax | 14.6 | 15.2 | 0.6 | 4.0 |
Self-Assessed Income tax | 3.3 | 4.2 | 0.9 | 26.2 |
Corporation Tax | 4.1 | 4.1 | 0.0 | 0.2 |
Other Taxes on Income & wealth² | 2.2 | 2.2 | 0.0 | 0.0 |
Other Taxes | 1.7 | 1.5 | -0.2 | -13.6 |
Compulsory social contributions | 12.8 | 13.3 | 0.6 | 4.3 |
Interest & Dividends receipts | 0.7 | 0.6 | -0.1 | -14.6 |
Other receipts | 2.9 | 3.1 | 0.1 | 4.8 |
Total Current Receipts | 64.1 | 63.2 | -0.9 | -1.4 |
Download this table Table 2: Central Government Current Receipts
.xls .csvIn 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.
Currently these forecasts incorporate estimates published in the Office for Budget Responsibility (OBR) Economic and fiscal outlook – November 2020 (EFO – November 2020). We will use OBR’s Economic and fiscal outlook – March 2021 published on 3 March 2021 to estimate tax receipts for the financial year ending March 2022 beginning in April 2021 (published on 25 May 2021).
Self-assessed Income Tax receipts
Each January (and July), accrued receipts tend to be higher than in other months because of receipts from self-assessed taxes paid by the self-employed. Late payments often mean that the effect of this tax boost is often felt in both February and August although to a lesser extent.
Looking at January and February combined, self-assessed Income Tax receipts were £21.0 billion, £2.3 billion more than in the same two months last year.
Some of this growth was likely because of the government’s deferral policy, giving an option for individuals to defer their July 2020 self-assessment payment to January 2021 because of the coronavirus pandemic, without incurring late payment charges. In light of this policy and the government’s payment plan facility to help those who expect to have difficulty in meeting their January 2021 obligations, this year it is advisable to look at the combined self-assessed Income Tax receipts across the whole financial year when drawing conclusions from year-on-year comparisons.
Currently, in the financial year-to-February 2021, self-assessed Income Tax receipts were £30.5 billion, £1.1 billion less than in the same period a year earlier.
Central government expenditure
Central government bodies spent £79.2 billion in February 2021, £15.9 billion more than in February 2020. Of this, £72.6 billion was spent on day-to-day activities (often referred to as current expenditure), such as:
- 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
Accounting for depreciation, the remaining £4.0 billion was spent on capital investment such as infrastructure.
Figure 5: Central government current expenditure continues to rise substantially compared with the same period last year
Central government current expenditure, UK, financial year-to-February 2021 compared with the financial year ending March 2020 (April 2019 to March 2020)
Source: Office for National Statistics – Public sector finances
Download this chart Figure 5: Central government current expenditure continues to rise substantially compared with the same period last year
Image .csv .xlsTable 3 summarises the components of central government expenditure in February 2021 and compares them with the equivalent measures in the same month a year earlier.
£ billion | ||||
---|---|---|---|---|
February 2020 | February 2021 | Change | % change | |
Interest payments¹ | 4.2 | 5.3 | 1.2 | 27.7 |
National Insurance Fund Benefits | 8.4 | 8.8 | 0.4 | 4.3 |
Social Assistance | 8.3 | 9.5 | 1.2 | 14.6 |
Other Net social Benefits | 0.1 | 0.0 | -0.1 | -100.0 |
Procurement² | 12.9 | 17.0 | 4.2 | 32.4 |
Pay | 11.6 | 13.1 | 1.5 | 12.9 |
Transfers to Local Government | 8.0 | 8.8 | 0.8 | 9.6 |
Contributions to EU | 1.3 | 0.0 | -1.3 | - |
Subsidies | 1.7 | 7.7 | 6.1 | 366.3 |
Other Expenditure | 1.9 | 2.4 | 0.5 | 26.3 |
Total Current Expenditure | 58.4 | 72.6 | 14.2 | 24.3 |
Depreciation | 2.5 | 2.6 | 0.1 | 4.0 |
Net Investment | 2.4 | 4.0 | 1.6 | 65.6 |
Total Expenditure | 63.3 | 79.2 | 15.9 | 25.1 |
Download this table Table 3: Central Government Expenditure
.xls .csvTotal government expenditure
This month we have updated our presentation of total central government expenditure to include a provision for depreciation. This presentation aligns us with that published by the Office of Budget Responsibility in their monthly Commentary on the Public Finances.
Interest payments on debt by central government
Interest payments on central government debt were £5.3 billion in February 2021, £1.2 billion more than in February 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 goods and services
Central government departments spent £5.8 billion more on goods and services in February 2021 than in February 2020, including £4.2 billion more on procurement and £1.5 billion more on pay. These increases partially reflect the expenditure by the Department of Health and Social Care (DHSC), devolved administrations and other departments in response to the coronavirus pandemic.
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.
Business rates relief repayment
In response to the coronavirus pandemic, qualifying businesses in retail, leisure and hospitality were eligible for business rates relief (alternatively described as a business rates holiday or discount) for the financial year ending (FYE) March 2021.
At the end of 2020, some businesses announced their intention to make payments in lieu of the relief.
Considering the voluntary nature of this decision, we treat the associated payments by these businesses in respect of the FYE March 2021 not as business rates (taxes), but instead as capital transfers to central government from the private non-financial corporations subsector, recorded at the point of payment.
Any central government receipt will reduce central government net borrowing and so public sector net borrowing by an amount equivalent to that receipt. It has no direct impact on the estimation of net cash requirement or net debt.
We will review the treatment of payments in lieu of the relief made in the financial year ending March 2022 at the earliest opportunity.
Subsidies paid by central government
In February 2021, central government paid £6.1 billion more in subsidies to businesses and households than in February 2020. These additional payments included the cost of the job furlough schemes; £3.8 billion as a part of the Coronavirus Job Retention Scheme (CJRS) and £0.1 billion Self Employment Income Support Scheme (SEISS). Additional transport subsidies account for much of the remaining £2.1 billion growth.
Local government and public corporations
Both local government and public corporations’ data for February 2021 are initial estimates, largely based on the Office for Budget Responsibility’s (OBR’s) Economic and fiscal outlook (November 2020), which will be revised when further information is available.
Subsidies paid out to businesses as part of the Coronavirus Small Business Grant Fund, the Coronavirus Retail, Hospitality and Leisure Grant Fund, the Coronavirus Local Authority Discretionary Grants, the Local Restrictions Support Grant and similar schemes in devolved administrations, are included based on administrative data published by the Ministry of Housing, Communities and Local Government (MHCLG) and by the Scottish and Welsh Governments where available.
In February 2021, central government current transfers to local government were £8.8 billion, £0.8 billion higher than February 2020. This increase is largely to enable local government to fund its coronavirus policies. Some coronavirus-related current grants that have been paid by central to local government have either not yet been spent, or have not yet been fully reflected in our estimates of local government spending.
Current and capital transfers between these sub-sectors and central government are based on administrative data supplied by HM Treasury and have no impact at the public sector level.
Borrowing in the current financial year-to-date
In the current financial year-to-February 2021, the public sector borrowed £278.8 billion, £228.2 billion more than in the same period last year.
This substantial increase largely reflects the impact of the coronavirus pandemic on the public finances, with the furlough schemes alone adding £74.4 billion to borrowing in the financial year-to-February 2021.
Table 4 summarises the components of public sector net borrowing (excluding public sector banks) in the financial year-to-February 2021 and compares them with the equivalent measures in the same period a year earlier. Additionally, the table presents estimates of the borrowing of public sector banks and the full public sector net borrowing measure.
£ billion | |||
---|---|---|---|
Financial year-to-date² | |||
2019/20 | 2020/21 | Change | |
Central Government Net Borrowing | 44.7 | 281.6 | 236.9 |
Local Government Net Borrowing | 10.3 | -0.1 | -10.4 |
Public Corporations Net Borrowing | -0.5 | 1.8 | 2.3 |
Public Sector Pensions Net Borrowing | -0.7 | -0.9 | -0.2 |
Sub-total: Public Sector Net Borrowing ex BoE and Banks | 53.7 | 282.4 | 228.7 |
Bank of England Net Borrowing | -3.2 | -3.6 | -0.4 |
Sub-total: Public Sector Net Borrowing ex¹ | 50.6 | 278.8 | 228.2 |
Public Sector Banks Net Borrowing | -8.0 | -8.1 | -0.1 |
Total: Public Sector Net Borrowing | 42.6 | 270.7 | 228.1 |
Download this table Table 4: Public Sector Net Borrowing
.xls .csvBorrowing had generally been falling since its peak in financial year ending (FYE) 2010. However, the £57.7 billion borrowed in the latest full financial year (April 2019 to March 2020) was £19.0 billion more than in the previous financial year, largely because of the impact of the coronavirus pandemic being evident from March 2020.
Figure 6: After several years of falling borrowing we are now seeing a substantial increase because of the impact of COVID-19 on government receipts and spending
Public sector net borrowing excluding public sector banks, UK, April 1993 to February 2021
Source: Office for National Statistics – Public sector finances
Notes:
- Financial year 2019 to 2020 represents the FYE 2020 (April 2019 to March 2020).
- Financial year-to-date represents April to February.
Download this chart Figure 6: After several years of falling borrowing we are now seeing a substantial increase because of the impact of COVID-19 on government receipts and spending
Image .csv .xlsTable 5 summarises the components of central government receipts in the financial year-to-February 2021 and compares them with the equivalent measures in the same period a year earlier.
£ billion | ||||
---|---|---|---|---|
Financial year-to-date² | ||||
2019/20 | 2020/21 | Change | % change | |
Value Added Tax | 141.3 | 125.7 | -15.6 | -11.1 |
Fuel Duty | 25.6 | 19.5 | -6.1 | -23.9 |
Alcohol Duty | 10.8 | 11.5 | 0.7 | 6.1 |
Tobacco Duty | 8.2 | 8.4 | 0.2 | 2.8 |
Business Rates | 26.8 | 17.1 | -9.7 | -36.1 |
Stamp Duty (L&P)¹ | 11.5 | 8.2 | -3.3 | -28.7 |
Customs Duties | 0.0 | 0.6 | 0.6 | - |
Other taxes on production | 36.9 | 32.3 | -4.6 | -12.5 |
Pay As You Earn Income Tax | 147.9 | 150.5 | 2.7 | 1.8 |
Self-Assessed Income tax | 31.6 | 30.5 | -1.1 | -3.5 |
Corporation Tax | 46.0 | 44.8 | -1.1 | -2.5 |
Other Taxes on Income & wealth³ | 6.2 | 7.4 | 1.2 | 19.4 |
Other Taxes | 18.6 | 17.4 | -1.1 | -6.0 |
Compulsory social contributions | 129.9 | 130.5 | 0.6 | 0.5 |
Interest & Dividends receipts | 16.8 | 18.9 | 2.1 | 12.6 |
Other receipts | 33.0 | 32.4 | -0.5 | -1.7 |
Total Current Receipts | 691.0 | 655.8 | -35.3 | -5.1 |
Download this table Table 5: Central Government Current Receipts
.xls .csvOn 20 March 2020, the government introduced a Value Added Tax (VAT) payment deferral policy to support UK business during the coronavirus pandemic by enabling them to pay Value Added Tax (VAT) due between 20 March and 30 June 2020 at a later date (though before 31 March 2022).
VAT receipts recorded in the financial year-to-February 2021 are provisional because the impact of this deferrals scheme has been estimated.
See Section 12 for more information on the challenges of measuring the effects of the coronavirus pandemic on VAT and other tax receipts.
Table 6 summarises the components of central government expenditure in the financial year-to-February 2021 and compares them with the equivalent measures in the same period a year earlier.
£ billion | ||||
---|---|---|---|---|
Financial year-to-date³ | ||||
2019/20 | 2020/21 | Change | % change | |
Interest payments¹ | 46.8 | 36.8 | -10.0 | -21.4 |
National Insurance Fund Benefits | 99.9 | 105.8 | 5.9 | 5.9 |
Social Assistance | 93.8 | 107.3 | 13.5 | 14.4 |
Other Net social Benefits | 4.3 | 2.3 | -2.0 | -46.5 |
Procurement² | 138.0 | 180.1 | 42.1 | 30.5 |
Pay | 128.0 | 139.5 | 11.5 | 9.0 |
Transfers to Local Government | 101.5 | 133.9 | 32.5 | 32.0 |
Contributions to EU | 10.9 | 10.9 | 0.0 | 0.3 |
Subsidies | 18.2 | 110.6 | 92.3 | 506.2 |
Other Expenditure | 30.3 | 32.1 | 1.8 | 5.9 |
Total Current Expenditure | 671.6 | 859.3 | 187.6 | 27.9 |
Depreciation | 27.5 | 28.2 | 0.7 | 2.6 |
Net Investment | 36.6 | 49.9 | 13.3 | 36.4 |
Total Expenditure | 735.7 | 937.4 | 201.7 | 27.4 |
Download this table Table 6: Central Government Expenditure
.xls .csvCentral government bodies are estimated to have spent £859.3 billion on day-to-day activities (current expenditure) in the financial year-to-February 2021, £187.6 billion more than in the same period in the previous year.
As a part of the government support for individuals and businesses during the pandemic, subsidies paid by central government increased by £92.3 billion. Of this, £74.4 billion was paid as a part of the job furlough schemes, with £54.6 billion on the Coronavirus Job Retention Scheme (CJRS) and £19.7 billion on the Self Employment Income Support Scheme (SEISS).
CJRS payments on an accrued (or national accounts) basis for the period March 2020 to January 2021 are based on HM Revenue and Customs (HMRC) estimates, while February’s estimate is based on estimates published in the Office for Budget Responsibility (OBR) Economic and fiscal outlook – November 2020 (EFO – November 2020).
Our CJRS estimate for March 2021 (published 23 April 2021) will be based on OBR’s Economic and fiscal outlook – March 2021 published on 3 March 2021.
SEISS payments are currently recorded on a cash basis, reflecting HMRC coronavirus statistics.
Local government borrowing
In the financial year-to-February 2021, local government borrowing was in surplus by £0.1 billion and represents £10.4 billion less borrowing than in the same period a year earlier.
The pattern of local government expenditure in this period is subject to greater than usual uncertainty. Some coronavirus-related current grants that have been paid by central to local government have not yet been spent by local government, with the possibility of any unspent grants being returned to central government.
Nôl i'r tabl cynnwys5. Central government net cash requirement
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. 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.
On 20 March 2020, the government introduced a Value Added Tax (VAT) payment deferral policy to support UK businesses during the coronavirus (COVID-19) pandemic by enabling them to pay Value Added Tax (VAT) due between 20 March and 30 June 2020 at a later date (though before 31 March 2022). This policy has substantially lowered VAT cash receipts over this four-month period.
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.
£ billion | ||||
---|---|---|---|---|
February 2020 | February 2021 | Change | % change | |
Cash Receipts | ||||
HMRC Receipts: Total paid over¹ | 49.3 | 52.2 | 2.9 | 5.8 |
HMRC Receipts: Income tax² | 19.5 | 21.5 | 2.0 | 10.0 |
HMRC Receipts: NICs³ | 12.2 | 12.7 | 0.4 | 3.4 |
HMRC Receipts: VAT⁴ | 12.6 | 11.2 | -1.4 | -11.2 |
HMRC Receipts: Corporation tax⁵ | 1.9 | 2.4 | 0.5 | 25.9 |
Interest & Dividends Receipts | 0.6 | 0.5 | -0.2 | -25.0 |
Other Receipts⁶ | 2.3 | 3.1 | 0.8 | 35.4 |
Total Cash Receipts | 52.2 | 55.8 | 3.5 | 6.7 |
Cash Outlays | ||||
Interest Payments | 0.2 | 0.3 | 0.0 | 8.6 |
Net Acquisition of Company Securities⁷ | 0.0 | 0.0 | 0.0 | - |
Net Department Outlays: Total⁸ | 49.3 | 61.9 | 12.7 | 25.7 |
Net Department Outlays: CJRS⁹ | 0.0 | 3.9 | 3.9 | - |
Net Department Outlays: SEISS¹⁰ | 0.0 | 0.1 | 0.1 | - |
Total Cash Outlays | 49.5 | 62.2 | 12.7 | 25.6 |
Cash Balance | ||||
Own account Net Cash Requirement ex¹¹ | -2.7 | 6.4 | 9.2 | 334.7 |
NRAM and B&B | 0.0 | 0.1 | 0.0 | 43.2 |
Network Rail | 0.0 | 0.0 | 0.0 | - |
Own account Net Cash Requirement¹² | -2.7 | 6.5 | 9.2 | 341.7 |
Download this table Table 7: Central government net cash requirement on own account
.xls .csv
£ billion | ||||
---|---|---|---|---|
Financial year-to-date¹³ | ||||
2019/20 | 2020/21 | Change | % change | |
Cash Receipts | ||||
HMRC Receipts: Total paid over¹ | 563.9 | 501.2 | -62.7 | -11.1 |
HMRC Receipts: Income tax² | 188.5 | 188.6 | 0.1 | 0.1 |
HMRC Receipts: NICs³ | 131.6 | 130.7 | -0.8 | -0.6 |
HMRC Receipts: VAT⁴ | 127.6 | 88.7 | -39.0 | -30.5 |
HMRC Receipts: Corporation tax⁵ | 56.7 | 44.0 | -12.7 | -22.4 |
Interest & Dividends Receipts | 16.9 | 19.3 | 2.3 | 13.7 |
Other Receipts⁶ | 16.9 | 24.9 | 8.0 | 47.4 |
Total Cash Receipts | 597.7 | 545.4 | -52.3 | -8.8 |
Cash Outlays | ||||
Interest Payments | 29.5 | 38.8 | 9.3 | 31.3 |
Net Acquisition of Company Securities⁷ | -4.3 | 0.0 | 4.3 | - |
Net Department Outlays: Total⁸ | 602.2 | 820.2 | 218.0 | 36.2 |
Net Department Outlays: CJRS⁹ | 0.0 | 53.8 | 53.8 | - |
Net Department Outlays: SEISS¹⁰ | 0.0 | 19.7 | 19.7 | - |
Total Cash Outlays | 627.4 | 859.0 | 231.6 | 36.9 |
Cash Balance | ||||
Own account Net Cash Requirement ex ¹¹ | 29.7 | 313.6 | 283.9 | 955.8 |
NRAM and B&B | 0.0 | 0.1 | 0.1 | 413.3 |
Network Rail | 0.2 | 0.2 | 0.0 | 0.0 |
Own account Net Cash Requirement ¹² | 29.9 | 313.9 | 284.0 | 950.3 |
Download this table Table 8: Central government net cash requirement on own account
.xls .csvOn the same day that we release the public sector finances, HM Revenue and Customs (HMRC) publishes a Summary of HMRC tax receipts, National Insurance contributions (NICs), tax credit expenditure and Child Benefit for the UK containing a detailed list of cash receipts.
Nôl i'r tabl cynnwys6. Debt
Public sector net debt (excluding public sector banks) at the end of February 2021 currently stands at £2,131.2 billion. This represents a £16.2 billion increase in debt compared with the end of January 2021 and a £347.2 billion increase in debt compared with the same point last year.
During the last 11 months of the coronavirus (COVID-19) pandemic, debt has increased by £333 billion. This increase is largely because of the extra funding required to finance government coronavirus support schemes, combined with reduced cash receipts.
The increase in debt over this period 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. Public sector net debt (excluding public sector banks) at the end of February 2021 was equivalent to 97.5% of GDP.
Our estimates expressed as a percentage of gross domestic product (GDP) are partially based on official projections, which means figures for recent periods are subject to revision particularly considering the uncertain impacts of the coronavirus pandemic on the economy.
Figure 7: Debt as a ratio of GDP has increased considerably during the coronavirus pandemic
Public sector net debt excluding public sector banks as a percentage of GDP, UK, March 1994 to the end of February 2021
Source: Office for National Statistics – Public Sector Finances
Download this chart Figure 7: Debt as a ratio of GDP has increased considerably during the coronavirus pandemic
Image .csv .xlsDebt 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.
At the end of February 2021, there was £1,839.5 billion of central government gilts in circulation (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.
There has been a substantial increase in gilts issuance at face (or redemption) value in the current financial year, partially reflecting the need for extra funding to support government coronavirus support schemes and to compensate for the fall in tax revenue.
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 Fund (APF) 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 February 2021 would reduce by £232.5 billion (or 10.6 percentage points of GDP) to £1,898.8 billion (or 86.9% of GDP).
Figure 8: At the end of February 2021, Bank of England contributed £232.5 billion to public sector net debt
Public sector net debt excluding public sector banks, UK, March 1994 to the end of February 2021
Source: Office for National Statistics – Public Sector Finances
Notes:
- Includes Asset Purchase Facility (APF) which includes the Term Funding Scheme (TFS) and TFS incentives for small and medium-sized enterprises (TFS SME).
- Public sector net debt excluding public sector banks (PSND ex) is the combination of PSND ex Bank of England (BoE) plus the BoE’s contribution to PSND ex.
- Public sector net debt excluding public sector banks (PSND ex) shown at the end of each financial year (March), unless otherwise stated.
Download this chart Figure 8: At the end of February 2021, Bank of England contributed £232.5 billion to public sector net debt
Image .csv .xlsBank of England Asset Purchase Facility Fund
Gilts are the primary financial instrument purchased under the Asset Purchase Facility Fund (APF). At the end of February 2021, the gilt holdings of the APF were £638.9 billion at face (or redemption) value, an increase of £16.6 billion compared with a month earlier. Following a government announcement on 5 November 2020, the gilt holdings of the APF are currently capped at £875 billion.
The estimated impact of the APF’s gilt holdings on debt currently stands at £113.1 billion, representing the difference between the value of the reserves created to purchase gilts (or market value of the gilts) and the face (or redemption) value of the gilts purchased.
In this case, it is not the gilt holdings themselves that contribute to debt but the difference in the valuations for these assets. The final debt impact of the APF depends on the disposal of these financial instruments at the end of the scheme (more specifically, the price received at their re-sale compared with their purchase price).
Corporate bond purchases under the APF umbrella have been on a smaller scale than gilt purchases. The total corporate bond holdings at the end of February 2021 stood at £19.9 billion, adding an equivalent amount to the level of debt.
The Bank of England publish the gilt portfolio of the Asset Purchase Facility Fund, along with its corporate bond purchases and the activity of the Term Funding Schemes.
Term Funding Scheme (TFS) and Term Funding Scheme with additional incentives for small and medium-sized enterprises (TFSME)
The Term Funding Schemes aim to reinforce the transmission of Bank Rate cuts to those interest rates faced by households and businesses.
The public sector balance sheet contains a liability as a result of the creation of the central bank reserves and an asset as a result of the loans to TFS (and TFSME) participants.
At the end of February 2021, the TFS loan liability stood at £39.6 billion and the TFSME loan liability stood at £75.4 billion, making a combined liability of £114.9 billion, adding an equivalent amount to the level of debt.
Assets purchased under the TFS and TFSME fall outside the boundary of 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 cynnwys7. Revisions
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.
The revisions presented in this section are largely the result of new tax and expenditure data received from our data suppliers.
Revisions to net borrowing in the financial year-to-January 2021
This month we have reduced our previous estimate of borrowing in the financial year-to-January 2021 by £10.9 billion.
We have reduced our previous estimate of central government borrowing in this period by £13.5 billion, largely because of a reduction in previous estimates of central government procurement, coupled with an overall increase in our previous estimate of tax receipts. This reduction in central government borrowing was partially offset by a reduction of £2.9 billion in local government surplus as new data have enabled us to better reflect authorities’ expenditure in supporting individuals and businesses during the coronavirus pandemic.
Table 9 summarises the revisions to the components of public sector net borrowing (excluding public sector banks) by comparing them with the equivalent measures published in the previous bulletin (published on 19 February 2021).
£ billion | ||||||
---|---|---|---|---|---|---|
January | Year-to-date² | |||||
Previous | Latest | Change | Previous | Latest | Change | |
Central Government Net Borrowing | 11.4 | 3.0 | -8.4 | 279.1 | 265.6 | -13.5 |
Local Government Net Borrowing | -2.1 | 0.7 | 2.8 | -7.3 | -4.4 | 2.9 |
Public Corporations Net Borrowing | 0.2 | 0.2 | -0.1 | 1.9 | 1.5 | -0.3 |
Public Sector Pensions Net Borrowing | -0.1 | -0.1 | 0.0 | -0.8 | -0.8 | 0.0 |
Sub-total: Public Sector Net Borrowing ex BoE and Banks | 9.5 | 3.8 | -5.6 | 272.7 | 261.8 | -10.9 |
Bank of England Net Borrowing | -0.7 | -0.7 | 0.0 | -2.2 | -2.2 | 0.0 |
Sub-total: Public Sector Net Borrowing ex¹ | 8.8 | 3.1 | -5.6 | 270.6 | 259.6 | -10.9 |
Public Sector Banks Net Borrowing | -0.7 | -0.7 | 0.0 | -7.3 | -7.3 | 0.0 |
Total: Public Sector Net Borrowing | 8.0 | 2.4 | -5.6 | 263.2 | 252.3 | -10.9 |
Download this table Table 9: Revisions to Public Sector Net Borrowing
.xls .csvRevisions to central government current receipts in the financial year-to-January 2021
Table 10 summarises the revisions to central government receipts by comparing them with the equivalent measures published in the previous bulletin (published on 19 February 2021).
£ billion | ||||||
---|---|---|---|---|---|---|
January | Year-to-date² | |||||
Previous | Latest | Change | Previous | Latest | Change | |
Value Added Tax | 11.4 | 11.3 | -0.1 | 114.6 | 115.4 | 0.8 |
Fuel Duty | 1.7 | 1.7 | 0.0 | 17.9 | 17.9 | 0.0 |
Alcohol Duty | 0.9 | 0.7 | -0.2 | 10.9 | 10.6 | -0.2 |
Tobacco Duty | 0.5 | 0.6 | 0.1 | 7.5 | 7.6 | 0.1 |
Business Rates | 1.5 | 1.5 | 0.0 | 15.5 | 15.6 | 0.1 |
Stamp Duty (L&P)¹ | 0.6 | 0.6 | 0.0 | 7.4 | 7.4 | 0.0 |
Customs Duties | 0.3 | 0.3 | 0.0 | 0.3 | 0.3 | 0.0 |
Other Taxes on Production | 3.0 | 2.9 | -0.1 | 28.9 | 29.4 | 0.5 |
Pay As You Earn Income Tax | 13.9 | 14.8 | 0.9 | 134.5 | 135.4 | 0.9 |
Self-Assessed Income tax | 16.8 | 16.8 | 0.0 | 26.3 | 26.3 | 0.0 |
Corporation Tax | 4.0 | 4.2 | 0.2 | 39.8 | 40.8 | 1.0 |
Other Taxes on Income & wealth³ | 7.2 | 7.3 | 0.1 | 5.0 | 5.0 | 0.0 |
Other Taxes | 1.4 | 1.4 | 0.0 | 15.9 | 16.0 | 0.1 |
Compulsory social contributions | 12.7 | 12.6 | -0.1 | 117.2 | 117.2 | 0.0 |
Interest & Dividends receipts | 1.3 | 1.5 | 0.1 | 17.6 | 18.3 | 0.7 |
Other receipts | 3.0 | 3.0 | 0.0 | 29.6 | 29.4 | -0.2 |
Total Central Government Current Receipts | 80.3 | 81.2 | 0.9 | 588.9 | 592.6 | 3.7 |
Download this table Table 10: Revisions to central government current receipts
.xls .csvTax receipts and National Insurance contributions
Estimates of central government tax receipts and National Insurance contributions presented in this bulletin are partially based on official projections published by the Office for Budget Responsibility (OBR). Currently these forecasts incorporate estimates published in their Economic and fiscal outlook – November 2020 (EFO – November 2020). We will use OBR’s Economic and fiscal outlook – March 2021 published on 3 March 2021 to estimate tax receipts for the financial year ending March 2022 beginning in April 2021 (published on 25 May 2021).
Section 12 explains the challenges of measuring the effects of the coronavirus pandemic on tax receipts and discusses the recording of tax receipts in some detail.
Central government current expenditure in the financial year-to-January 2021
Table 11 summarises the revisions to central government expenditure by comparing them with the equivalent measures published in the previous bulletin (published on 19 February 2021).
£ billion | ||||||
---|---|---|---|---|---|---|
January | Year-to-date³ | |||||
Previous | Latest | Change | Previous | Latest | Change | |
Interest payments¹ | 1.8 | 1.0 | -0.8 | 32.8 | 31.5 | -1.3 |
National Insurance Fund Benefits | 9.6 | 9.5 | -0.1 | 97.1 | 96.9 | -0.1 |
Social Assistance | 10.0 | 9.8 | -0.2 | 97.9 | 97.8 | -0.1 |
Other Net social Benefits | 0.1 | -0.1 | -0.2 | 2.4 | 2.4 | 0.0 |
Procurement² | 20.9 | 16.8 | -4.1 | 168.0 | 163.1 | -4.9 |
Pay | 13.1 | 13.0 | 0.0 | 127.1 | 126.4 | -0.7 |
Transfers to Local Government | 14.8 | 13.7 | -1.1 | 126.2 | 125.1 | -1.0 |
Contributions to EU | 0.0 | 0.0 | 0.0 | 10.9 | 10.9 | 0.0 |
Subsidies | 8.5 | 8.1 | -0.3 | 103.2 | 102.8 | -0.4 |
Other Expenditure | 3.1 | 3.4 | 0.3 | 30.0 | 29.8 | -0.2 |
Total Current Expenditure | 81.9 | 75.2 | -6.8 | 795.6 | 786.7 | -8.9 |
Depreciation | 2.6 | 2.6 | 0.0 | 25.7 | 25.6 | -0.2 |
Net Investment | 7.2 | 6.5 | -0.7 | 46.6 | 45.9 | -0.7 |
Total Expenditure | 91.7 | 84.3 | -7.4 | 867.9 | 858.2 | -9.7 |
Download this table Table 11: Revisions to central government expenditure
.xls .csvRevisions to interest payments
This month we have supplemented our previous estimate of central government interest payments with data sourced from the national accounts. The monthly profile of these data is still not final and may be updated further in the coming months.
Revisions to procurement
Throughout the pandemic our estimates of central government procurement of goods and services have contained a larger proportion of estimated data than is usual and as a result have been prone to substantial revisions. This month we have reduced our previous estimate in the financial year-to-January 2021 by £4.9 billion. This revision is centred around the January 2021 estimate, which we have reduced by £4.1 billion since our first estimate last month.
Current grants to local government
This month we have reduced our estimates of current grants paid by central to local government by £1.0 billion in the financial year-to-January 2021. While central government borrowing reduced by £1.0 billion as a result of this update, local government borrowing was increased by an equal and offsetting amount over the same period.
Revisions to local government net borrowing
This month we have reduced our previous estimate of local government surplus in the financial year-to-January 2021 by £2.9 billion as new data have enabled us to better reflect local authorities’ expenditure in supporting individuals and businesses during the coronavirus pandemic.
Notably, we have increased our estimates of subsidies paid to individuals and businesses by £4.3 billion and procurement on goods and services by £1.6 billion. This increase on current expenditure has been partially offset by a reduction in capital expenditure.
Revisions to net borrowing in earlier years
Although updated Corporation Tax credit data supplied by HM Revenue and Customs (HMRC) in December 2020 was recorded as a receipt in December, the associated equal and offsetting subsidy has not been recorded until now. As a result, this month we have recorded small increases in central government net borrowing between the financial year ending March 2016 to date of between of between £0.1 and £0.6 billion.
Revisions to public sector net debt and net cash requirement
Table 12 shows the revisions to public sector net debt and net cash requirement presented in this bulletin compared with those presented in the previous bulletin (published on 19 February 2021).
£ billion unless otherwise stated | |||
---|---|---|---|
Period | Net Debt | Net Debt % GDP¹ | Net Cash Requirement |
Financial year | |||
2018/19 | 0.0 | 0.0 | 0.0 |
2019/20 | 0.0 | 0.0 | 0.0 |
Months | |||
2020 April | -0.4 | 0.0 | 0.0 |
2020 May | -0.4 | 0.0 | 0.0 |
2020 June | -0.4 | 0.0 | 0.0 |
2020 July | -0.4 | -0.2 | 0.0 |
2020 August | -0.5 | -0.4 | 0.0 |
2020 September | -0.5 | -0.5 | 0.0 |
2020 October | -0.5 | -0.6 | 0.0 |
2020 November | -0.5 | -0.7 | 0.0 |
2020 December | -0.5 | -1.0 | 0.0 |
2021 January | 0.5 | -0.8 | -0.1 |
Download this table Table 12: Revisions to public sector net debt and net cash requirement
.xls .csvRevision to public sector net debt
This month we have updated our previous estimate of the debt associated with central government finance leases (including public private partnerships). Primarily a reduction in the finance lease liability due to annual amortisation, these data are updated annually and are based on ONS estimates. As a result, we have reduced the level of central government gross debt by £0.4 billion from April 2020 to date.
Further, we have updated our estimates of several components of debt with data sourced from the latest national accounts dataset.
Revisions to public sector net debt as a ratio of GDP
This month we have updated our gross domestic product (GDP) estimates to incorporate OBR’s Economic and fiscal outlook – March 2021 published on 3 March 2021.
As a result, we have reduced our previously published estimate of public sector net debt (excluding public sector banks) expressed as a ratio of GDP at the end of January 2021 by 0.8 percentage points to 97.1%. These revisions to the debt ratio extend back to July 2020.
Further, this month we have aligned our historical public sector net debt as a ratio of GDP series from the financial year ending March 1921 to March 1997 with that published by OBR in their public finances databank.
We have published an article that explains how estimates of GDP are used to present debt and other headline measures.
Nôl i'r tabl cynnwys8. Public sector finances data
Public sector finances borrowing by sub-sector
Dataset | Released 19 March 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 19 March 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 19 March 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 19 March 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 19 March 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 19 March 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.
9. Glossary
Public sector
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 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 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”.
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.
Other important terms commonly used to describe public sector finances are listed in the Public sector finances glossary.
Nôl i'r tabl cynnwys10. Measuring the data
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. Additionally, it details the data sources used to compile the monthly estimates of the fiscal position. The borrowing estimates presented in this bulletin are not adjusted for inflation.
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 spring and autumn.
The official OBR expectations for the financial year ending March 2021 presented in Table 13 reflect those published in the OBR’s Economic and fiscal outlook – March 2021 published on 3 March 2021.
£ billion unless otherwise stated (not seasonally adjusted) | |||
---|---|---|---|
April to February outturn | Implied March expectation | Full financial year forecast¹ | |
Net Borrowing | 278.8 | 75.8 | 354.6 |
Net Debt² | 2,131.2 | 66.7 | 2,197.9 |
Net Debt % of GDP³ | 97.5 | 2.7 | 100.2 |
Download this table Table 13: How the latest outturn public sector figures compare to official OBR forecasts for the financial year ending March 2021, UK
.xls .csvIt should be noted that the OBR borrowing forecast for the financial year ending March 2021 (April 2020 to March 2021) includes an estimated £27.2 billion in write-offs of the business loans under the government’s coronavirus (COVID-19) schemes whereas ONS outturn data does not yet include any estimates for these write-offs.
International comparisons
General government net borrowing in financial year-to-February 2021 is estimated to have been around 12.2% of GDP, while general government gross debt stood at around 99.8% of GDP at the end of February 2021; statistics for the general government sector are used for international comparisons and include central and local government only.
The UK government debt and deficit statistical bulletin is published quarterly (in January, April, July and October each year), to coincide with when EU member states are required to report their deficit (or net borrowing) and national debt to the European Commission.
Our next bulletin will be published on 30 April 2021 and will contain UK data consistent with this release, Public sector finances, UK: February 2021.
On 21 January 2021, we published UK government debt and deficit: September 2020, consistent with Public sector finances, UK: November 2020 (published on 22 December 2020).
These statistics were published by Eurostat on 21 January 2021 alongside comparable data for each of the 27 EU member states for general government gross debt and borrowing.
Figure 9 illustrates how the recent change in UK general government consolidated gross debt (or Maastricht debt) compares with selected EU member states.
Measured according to the Maastricht definition, UK government debt increased by 16.9 percentage points of GDP between the end of September 2019 and the end of September 2020. This increase was 4.7 percentage points higher than the average of the 27 EU member states.
Figure 9: The UK’s debt on a Maastricht basis grew by 16.9 percentage points between the end of September 2019 and the end of September 2020
Maastricht debt at the end of September 2020 compared with that at the end of September 2019
Source: Eurostat and Office for National Statistics
Notes:
- EU 27 - Average of the 27 EU member states.
Download this chart Figure 9: The UK’s debt on a Maastricht basis grew by 16.9 percentage points between the end of September 2019 and the end of September 2020
Image .csv .xlsEnd 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 Office for National Statistics (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
11. Strengths and limitations
National Statistics status for public sector finances
On 20 June 2017, the UK Statistics Authority published a letter confirming the designation of the monthly public sector finances bulletin as a National Statistic. This letter completes the 2015 assessment of public sector finances.
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 January 2021 estimate of GDP requires data across five quarters of GDP. Of these, two are based on the latest Office for National Statistics (ONS) published data and three are based on official Office for Budget Responsibility (OBR) projections:
data up to and including Quarter 4 (October to December) 2020 are based on the published GDP first quarterly estimate, UK: October to December 2020
estimates of GDP for the subsequent three calendar quarters (January to September 2021) are based on expectations published in the OBR’s Economic and fiscal outlook – March 2021 published on 3 March 2021.
Local government
Local government data for the financial year ending March (FYE) 2020 are based on a mixture of provisional outturn data (current and capital expenditure for England and Scotland) and budget data. Both provisional outturn and budget data are subject to further revisions.
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 to reduce the amounts reported at the budget stage.
For FYE 2020, we include a £0.2 billion downward adjustment to Wales’ capital expenditure.
Local government data for FYE 2021 are initial estimates, based on the OBR forecasts. These figures reflect our initial estimates of the impact of the coronavirus pandemic.
For FYE 2021, these estimates include a £8.5 billion upward adjustment to budget forecast data (which predates the coronavirus pandemic) for England’s current expenditure on goods and services, and a £4.6 billion downward adjustment to England’s capital expenditure. We have included £0.7 billion and £0.2 billion downward adjustments to Scotland’s and Wales’ capital expenditure respectively. 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.
Further information on these and additional adjustments can be found in the Public sector finances QMI.
Current and capital transfers between local and central government are based on administrative data supplied by HM Treasury.
Non-financial public corporations
Public corporations data for FYE 2021 are initial estimates, based on OBR forecasts. Current and capital transfers between public corporations and central government are based on administrative data supplied by HM Treasury.
Public sector funded pensions
Pensions data for FYE 2020 and 2021 are our estimates based on the latest available data. Some of these estimates rely on actuarial modelling; this is a complex process that most public sector schemes conduct every three to four years. Until such valuations become available, we forecast the change in pension liability using our knowledge of the economic climate. Pensions in the public sector finances: a methodological guide outlines both the theory and practice behind our calculation of pension scheme estimates.
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.
Customs duties
From January 2021, customs duties are recorded as UK tax receipts; previously they were recorded as EU tax receipts (not in the UK public sector).
To ease business’ transition, the government has decided to introduce customs controls in stages for non-controlled goods imported from the EU. From 1 January to 30 June 2021, a customs declaration can be submitted up to 175 days after the day of import.
For controlled goods customs declarations are required and must be pre-lodged onto HM Revenue and Customs (HMRC) systems.
As the UK has signed a Trade and Cooperation Agreement with the EU, the amount of customs duties expected on imports from the EU is low. Where duties are due, they are payable when a declaration is submitted, so the introduction of customs controls in stages will mean some accrued receipts from imports up to 30 June 2021 are not received until the second half of 2021.
Nôl i'r tabl cynnwys