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BCC: Deficit reduction remains a painful task

·         In September 2013, public sector net borrowing, excluding effects of financial interventions, was £1bn lower than in September 2012

·         In the first six months of the current financial year, cumulative borrowing on a comparable basis was £5.9bn lower than in the corresponding period of the last financial year

·         In September 2013, public sector net debt, excluding effects of financial interventions, was 75.9% of GDP

Commenting on the public sector finances for September 2013, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC) said:

“We’ve made gradual progress in reducing government borrowing, but the deficit is still far too high. Recent improvements to our GDP figures haven’t yet been reflected in our public finances. But with the economy expected to continue growing, this is likely to change over the next few years.

“The weakening of our financial sector and the sharp fall in our oil and gas reserves may have created a permanent hole in the economy’s ability to generate tax revenues, so the government is right to continue with its deficit-reduction plan while the economy improves. Although we have to adjust to the painful economic realities created by the financial crisis, the government must also focus on measures to boost growth, such as investment in infrastructure, support for exporters, and improved availability of finance for growing businesses.”