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 February 2017, 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” 4 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office (http://www.dmo.gov.uk/) to raise cash for HM Treasury:-
23-Feb-2017 1½% Treasury Gilt 2026 £2,299.9970 Million
15-Feb-2017 0 1/8% Index-linked Treasury Gilt 2026 £1,250.0000 Million
09-Feb-2017 1½% Treasury Gilt 2047 £2,624.2900 Million
07-Feb-2017 1¾% Treasury Gilt 2019 £3,004.2150 Million
When you add the cash raised:-
∑(£2,299.9970 Million + £1,250.0000 Million + £2,624.2900 Million + £3,004.2150 Million = £9,178.50 Million
£9,178.50 Million = £9.17850 Billion
On another way of looking at it, is in the 28 days in Feb, HM Government borrowed:-
£327 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 2019, 2026 and 2047. All long term borrowings, we are mortgaging our futures, but at least “We are in it together…”