Banking misdeeds help cut Britain’s public finance deficit

November’s net borrowing was £14.1 billion — £1.6 billion below a year ago

(GETTY IMAGES)

Public borrowing fell last month as banking fines to the tune of £1.1 billion for foreign-exchange rigging helped boost the Treasury's coffers.

Official figures showed November’s net borrowing was £14.1 billion — £1.6 billion below a year ago. Borrowing for the eight months of the current financial year is running at £75.8 billion, £478 million lower than last year.

The forex fines will prove a temporary boost to the Treasury’s coffers as Chancellor George Osborne has already earmarked the cash to improve GP surgeries.

But revisions to previous data — including lower capital spending — improved the overall picture while economists also noted a stronger tax take. Income-tax receipts were up 4.1 per cent year on year to £10.9 billion over the month, while VAT takings rose 2.8 per cent to £10.4 billion.

January should, meanwhile, bring a windfall in self-assessment income-tax receipts, although experts suggested the Chancellor might still struggle to hit the Office for Budget Responsibility’s recently revised borrowing target of £91.3 billion for the full year.

Capital Economics’ Samuel Tombs said borrowing for the last four months of the year would have to be 27 per cent below last year.

He added: “While November’s public-finance figures are a step in the right direction, the road to fiscal sustainability look set to be long and bumpy.”