The Public Sector Net Cash Requirement (PSNCR) showed a surplus of pounds 1.5bn in February, taking the cumulative surplus for the first 11 months of the financial year to pounds 15.1bn. The Budget estimated the full-year surplus would be pounds 5.2bn.
Although March has traditionally seen a big deficit because of an end- of-year spending surge, this pattern has been less pronounced in recent years. Many analysts are therefore predicting a bigger surplus of pounds 8-10bn.
However, the Treasury downplayed these hopes yesterday, suggesting the pattern of public spending could be reverting to the traditional profile.
Even so, yesterday's figures clearly show the public sector's healthy financial position. Net borrowing was in surplus by pounds 1.1bn in February, taking the cumulative total to pounds 8.7bn compared with pounds 3.3bn at the same stage last financial year.
Income tax receipts were buoyant in February thanks to self-assessment. But Customs & Excise receipts have fallen since the new year.
Government expenditure is accelerating as the year-end approaches, from April to February, running pounds 6bn higher than the first 11 months of 1997/98.