Government 'to borrow £64 billion more' than planned

The Institute for Fiscal Studies said the Chancellor will borrow £64 billion more than intended during this parliament.

The increased figures is due to Osborne's original borrowing predictions being based on a more optimistic economic outlook. The IFS explain:

He will be borrowing £64 billion more in 2014-15 than he planned just two years ago. This is because he is choosing not to offset the forecast deterioration of £65 billion driven by a worse economic outlook. Announced policy measures will reduce borrowing by just £1 billion. As a result he is on course to miss his own target of debt falling in 2015.

Indeed he is now pursuing a looser policy than that permitted by the last government’s Fiscal Responsibility Act. Had he not repealed that legislation he would have been obliged to cut spending or increase taxes by around an additional £8 billion next year.

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IFS warns over public sector

The Institute for Fiscal Studies has warned that government borrowing will rise, public sector spending cuts will increase. The OECD has also said the UK must do more to boost growth and tackle inequality, which it says are key to economic recovery.