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 2016, 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 :-
17-Feb-2016 1½% Treasury Gilt 2026 £2,750 Million
11-Feb-2016 3½% Treasury Gilt 2045 £1,649.9750 Million
09-Feb-2016 0 1/8% Index-linked Treasury Gilt 2026 £1,429.9650
When you add the cash raised:-
∑(£2,750 Million + £1,649.9750 Million + £1,429.9650) = £5,829.94 Million
£5,829.94 Million Million= £5.829 Billion
On another way of looking at it, is in the 29 days in Feb, HM Government borrowed:-
£201 million each day for the 29 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 2026 and 2045. All long term borrowings, we are mortgaging our futures, but at least “We Are In It Together…”