IFS response to new public finance figures

Carl Emmerson, Deputy Director of the Institute for Fiscal Studies said:

"Today's numbers show that borrowing in the first half of this year was £72 billion, which is almost the same as the Office for Budget Responsibility's forecast for this period in March. But this is little guide to how much borrowing will be over the whole of this financial year, as the huge cost of Government support for household and business energy use only began in earnest this month. Fuelled by this in last week's Green Budget we forecast that borrowing this year could reach almost £200 billion, which would be nearly £100 billion more than the OBR forecast.

A key focus for the next Prime Minister and their chosen Chancellor needs to be fiscal responsibility. We need a credible plan to ensure that government debt can be expected to fall over the medium-term. Given the timeline for determining the next Prime Minister, the degree of economic uncertainty, and the importance of getting this right, there is a strong case for taking a bit longer to make good decisions which have more chance of standing the test of time, rather than going ahead with a major fiscal event only a few days into the new PM's tenure.