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Government borrowing rockets £1.9bn

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Public sector borrowing soared last month, official statistics have revealed, despite the chancellor’s attempts to cut the government’s mounting debt pile.

The Office for National Statistics said government net borrowing, excluding the temporary effects of financial interventions, stood at £15.9bn in August 2011 –  some £1.9bn higher than the same month last year.

The government borrowed more after income tax receipts fell for the first time in the month and expenditure rose after an unusually low figure in July, according to the Press Association.

This leaves current net borrowing since March at £51.5bn, down £3.9bn on the same period the previous year.

A Treasury spokesman said: “These are challenging times, but despite economic growth being lower than the OBR’s forecast earlier this year, tax receipts have continued to grow and spending so far this year has grown at the rate the OBR forecast in the Budget.

“These figures also include a welcome and substantial downward revision to borrowing so far this year and to overall borrowing last year.”

Net debt, excluding the temporary effects of financial interventions was £944.5 bn, equivalent to 61.4% of GDP.

“At face value, the latest month isn’t very good, but last month was revised much lower and the previous fiscal year revised much lower,” analyst Alan Clarke of Scotia Capital told the BBC.

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