Fines paid by banks in the foreign exchange scandal have improved the UK’s public finances overall, giving Chancellor George Osborne a break as he tries to show voters he can keep on bringing down the deficit.
Data released were welcomed by Osborne and Prime Minister David Cameron, especially as there is an upcoming election which many suggest will be tight affair.
The economy took a hit recently when the budget deficit stopped falling as receipts in November were boosted by 1.1 billion pounds this was because banks were fined for their involvement in the foreign exchange rate-fixing scandal. Also income tax receipts and national insurance contributions rose nearly 3% in November which was twice as fast as in October.
The Office for National Statistics stated that public sector net borrowing (excluding state-controlled banks) fell 10 per cent in November to 14.1 billion pounds and also retailers reported sales in late November and early December were at their strongest since 1998, after US-style Black Friday and Cyber Monday promotions.
Economist at Investec Bank, Victoria Clarke said: “The numbers were moving in Osborne’s favour and he should at least manage to keep the deficit falling this year, or even meet his revised targets, which have looked out of reach just months ahead of the election, this would be a major plus.”