UK government borrowing rises

UK government borrowing rose by half a billion pounds in June.

According to the Office for National Statistics, public sector net borrowing, excluding interventions such as bank bailouts, was £14.4bn last month.

While tax revenues increased in the month by 3.6 per cent to £40.9bn, total government spending only dipped by less than 1 per cent to £52.4bn.

This is up from £13.9bn in June 2011, and raises doubt over the government’s ability to meet full-year targets to bring down borrowing.

Borrowing in 2011-12 was also revised downwards. The ONS has said today that borrowing in the last financial year was actually £125.7bn, down from the original estimate of £127.6bn that it made last month.

The figures come after the International Monetary Fund said this week that the government should slow the pace of the tough austerity measures if the economy fails to pick up.

Colin Edwards, economist at the Centre for Business and Economic Research (Cebr), said, "The ability of the government to borrow at historically low interest rates – the yield on 10-year government bonds currently stands around 1.5 per cent - provides some room for manoeuvre in the government’s attempts to reduce the deficit. Indeed, the debate over the pace of fiscal consolidation gathered momentum this week as the International Monetary Fund (IMF) slashed its forecast GDP growth for the UK to 0.2 per cent for 2012 from 0.8 per cent in its April forecast, bringing it closer to Cebr’s most recent forecast for a 0.2 per cent contraction this year.

"Against this backdrop, the OBR forecast for public sector net borrowing to fall this year by around £10bn looks under threat. Hence, the government is between a rock and a hard place: economic growth is minimal and the deficit appears to be rising again. The IMF’s remarks this week mean the debate around easing the pace of fiscal consolidation is likely to gather momentum in the lead up to the Autumn Statement."

This article first appeared in economia.

Photograph: Getty Images

Helen Roxburgh is the online editor of Economia

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The government has quietly shut the door on vulnerable child refugees

The government has tried to halt the Dubs Amendment, a scheme designed to save thousands of vulnerable child refugees.  

The "Dubs Amendment" to the Immigration Bill of last year, in which the government begrudgingly promised to accept 3,000 unaccompanied child refugees from other countries in Europe, was halted this month after only 350 children had been admitted.

It has since become absolutely clear that the government is wriggling out of its obligation to accept child refugees, shutting the door on the most vulnerable. 

The amendment was named after my Labour colleague in the House of Lords. Alfred Dubs, who grew up in Britain and was saved from the hands of the German Nazi regime by Nicholas Winton, who rescued 669 children virtually single-handedly from Czechoslovakia.

The decision – announced at a time when the media was mainly concentrating on Brexit - has since been the source of much outcry both within Parliament and beyond. People across Britain are clear that the government must end these efforts to prevent refugees arriving here, and this is not who we as a society are.

Labour simply cannot accept the government’s decision, which seems to breach the spirit of the law passed with cross-party support. I have challenged Home Secretary Amber Rudd on the issue. 

The government's actions have also been criticised by Yvette Cooper, who heads Labour’s refugee task force and the Home Affairs select committee, the Archbishop of Canterbury, Justin Welby, and Scotland’s First Minister, Nicola Sturgeon, who called it “a clear dereliction of the UK’s moral and global duty”. 

Then at the recent Bafta awards, a number of those in attendance including the actor Viggo Mortensen, also wore lapel badges reading “Dubs now”.

And we have seen more than 200 high-profile public figures including Ralph Fiennes, Keira Knightley, Sir Mark Rylance, Gary Lineker, Michael Morpurgo and the band Coldplay write to Theresa May calling on her government not to close the scheme, decrying the decision as “truly shameful” and adding that “the country we know and love is better than this". 

As the letter states, it is embarrassing, that this government cannot match even Winton’s total. As his own daughter put it in her letter to the Prime Minister, “I know we can’t take in every unaccompanied child in Europe, but I suppose there was a sense when the government accepted the Dubs Amendment that they would make a bigger contribution than they have.”

We need to be clear that where safe and legal routes are blocked for these children, they are left with a terrible choice between train tracks on the one hand, and people traffickers on the other. These children have been identified as the most vulnerable in the world, including girls without parents, who are susceptible to sex traffickers.

The government’s decision is particularly disappointing in that we know that many local authorities across Britain, which assume responsibility for the children once they are admitted to the country, are willing to accept more refugees.

Yet the public outcry shows we can still force a change.

Interestingly, former Conservative minister Nicky Morgan has argued that: “Britain has always been a global, outward-facing country as well as being compassionate to those who need our help most. The Conservative party now needs to demonstrate that combination in our approach to issues such as the Dubs children.”

Let’s keep the pressure up on this vital issue. The internationally agreed principles and the Dubs Amendment were never conceived as a “one-off” - they should continue to commit to meeting their international treaty obligations and our own laws.

And on our part, Labour commits to meeting the obligations of the Dubs Amendment. We will restore the scheme and accept some of the most vulnerable children in the world.

 

Diane Abbott is Labour MP for Hackney North and Stoke Newington, and shadow home secretary. She was previously shadow secretary for health.