PBR analysis: the public finances

Gordon Brown shrugged off the uncertainties that surround any forecast for the public finances and insisted in his Pre-Budget Report that he would meet his self-imposed constraints on borrowing without having to cut spending or announce new tax increases.

The Chancellor predicted in March that he would need to borrow £10.5bn this financial year to bridge the gap between tax revenues and non-investment spending. But over the first seven months spending has been stronger and tax revenues weaker than projected for the year as a whole. He would need around £23bn if these trends persist.