Bloomberg News

Osborne Under Pressure as U.K. Budget Deficit Widens

May 22, 2012

Chancellor of the Exchequer George Osborne. Photographer: Chris Ratcliffe/Bloomberg

Chancellor of the Exchequer George Osborne. Photographer: Chris Ratcliffe/Bloomberg

Britain had an underlying budget deficit of 13.8 billion pounds ($21.8 billion) in April, the first month of the fiscal year.

The figure, which excludes support for banks, compared with 9.1 billion pounds a year earlier, the Office for National Statistics said in London today. Revenue rose 1.3 percent in April from a year earlier and spending increased 3.8 percent.

The public finances received a one-time boost of 30.3 billion pounds from the transfer of Royal Mail Group Ltd. pension assets to the public sector and the impact of the central bank’s Special Liquidity Scheme. This left a budget surplus of 16.5 billion pounds last month.

Prime Minister David Cameron has said there can be no retreat from his plan to erase a deficit of 8 percent of gross domestic as the deepening euro-region crisis intensifies pressure for a relaxation of his austerity policies.

A cash-based measure of the government finances showed a surplus of 23.2 billion pounds in April.

To contact the reporter on this story: Jennifer Ryan at jryan13@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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