Reality check: we cannot consume our way to balanced recovery

Rejoice. Like the economy, the UK public finances are at last moving in the right direction. October is an important month for corporation tax inflows, and most of the anecdotal evidence is that with an improving economy, they are picking up nicely.

Add in expected increases in taxes from the housing market – and with rising consumption, some improvement in VAT receipts – and by the end of this financial year, public sector net borrowing could be as much as £10bn lower than the Office for Budget Responsibility (OBR) was forecasting as recently as the last Budget in March. Another feather in the Chancellor’s cap then?




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