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 June 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” 3 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office (http://www.dmo.gov.uk/) to raise cash for HM Treasury :-
11-Jun-2015 3½% Treasury Gilt 2045 £2,199.9520 Million
09-Jun-2015 1/8% Index-linked Treasury Gilt 2024 £900.0000 Million
02-Jun-2015 2% Treasury Gilt 2025 £3,250.0000 Million
When you add the cash raised:-
∑(£2,199.9520 Million + £900 Million + £3,250 Million) = £6,349.95 Million
£6,349.95 Million = £6.3495 Billion
On another way of looking at it, is in the 30 days in June, HM Government borrowed:-
£211 million each day for the 30 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, 2025 & 2045. All long term borrowings, we are mortgaging our futures, but at least “we are in it together…”