Another month, guess what, take a lucky guess, it is the same old story, HM Government, spends more money than it receives via taxes and duties. Another deficit month, thus to bridge the gap, needs to borrow on the bond market.
In Feb 2015, the HM Government had to borrow money to meet the difference between tax revenues and public sector expenditure. The term for this is The PSNCR: The Public Sector Net Cash Requirement.
There were “only” 2 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office (http://www.dmo.gov.uk/) to raise cash for HM Treasury :-
11-Feb-2015 3½% Treasury Gilt 2045 £1,750.000 Million
04-Feb-2015 0 1/8% Index-linked Treasury Gilt 2024 £1,200.000 Million
When you add the cash raised:-
∑(£1,750.000 Million + £1,200.000 Million ) = £2,950.00 Million
£2,950.00 Million = £2.975 Billion
On another way of looking at it, is in the 28 days in Feb, HM Government borrowed:-
£105 million each day for the 28 days. We are fortunate, while the global banking and financial markets still has the confidence in HM Government to buy the Gilts (Lend money to the UK), the budget deficit keeps rising. What is also alarming, is the dates these bond mature 2024 and 2045. All long term borrowings, we are mortgaging our futures, but at least “we are in it together…”