Another month, guess what, take a wild guess, it is the same old story, HM Government, spends more money than it receives via taxes. Another deficit month, thus to bridge the gap, needs to borrow on the bond market.
In October 2013, 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-Oct-2013 1¼% Treasury Gilt 2018 5,224.8720 Million
08-Oct-2013 0 1/8% Index-linked Treasury Gilt 2019 1,786.2500 Million
03-Oct-2013 2¼% Treasury Gilt 2023 4,399.5340 Million
When you add the cash raised:-
∑(5,224.8720 Million + 1,786.2500 Million + 4,399.5340 Million) = £11,410.66 Million
£11,410.66 Million = £11.410 Billion
On another way of looking at it, is in the 31 days in October HM Government borrowed:-
£368 million each day for 31 days. We are fortunate, while the global banking and financial markets still has the confidence in HM Government to buy the Gilts. The budget deficit keeps rising. What is also alarming, is the dates these bond mature, 2018, 2019 and 2023. All long term borrowings, we are mortgaging our futures.