Gordon Brown is poised to break his own Golden Rule because income and expenditure are failing to match up with promises made report the FT and The Times today.
Public sector net investment between April to September this year increased just 1.9% against the same period the previous fiscal year, against a Budge forecast of an increase greater than 63% through the entire fiscal year, the FT says.
Current expenditure is already up 6.6% through the six-month period, against Budget forecasts of 5.2% for the whole fiscal year.
”If these trends persist, the government would run out of leeway on its definition of the golden rule by the end of the financial year,” the paper warns.
The Times notes the latest government spending figures suggest Brown will be forced to “raise taxes quickly” were Labour to win a general election next year.
The government borrowed £4.8bn in September, twice the amount in the same month last year, because tax revenues continue to lag forecasts, the paper says.
Over the first half of the fiscal year the government borrowed £22.75bn, about two-thirds of the planned £33bn in borrowings over the entire fiscal year outlined in the Budget.
”The Chancellor needs a fast turnaround in revenue to avoid breaking his rule,” The Times adds.
The Scotsman says the figures are all the more disappointing because of the high price of oil, which should have brought additional revenue to Treasury coffers.
However, it may be the case that falls in corporate tax from non-oil companies, which traditionally fall away when the price of oil rises, have offset the expected bonanza, the paper adds.
WOMENS’ PENSIONS ARE “a disgrace” work and pensions secretary Alan Johnson admitted yesterday to the Commons Work and Pensions Committee, reports The Daily Telegraph.
Just 50% of women get the full basic state pension, often because their working records are interrupted by demands to be carers for children or elderly parents, Johnson admitted.
Meanwhile, Johnson angered Opposition members of the Committee by referring to the target by which in future 60% of pensions are hoped to come from the private sector and 40% from the state as “an arbitrary figure”.
The suggestion is the government may be abandoning this goal because its policies are unworkable, the Telegraph suggests.IFAonline
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