Public sector finances, UK: September 2018

• Borrowing (Public sector net borrowing excluding public sector banks) in September 2018 was £4.1 billion, £0.8 billion less than in September 2017; this was the lowest September borrowing for 11 years (since 2007).

• Borrowing in the current financial year-to-date (YTD) was £19.9 billion: £10.7 billion less than in the same period in 2017; the lowest year-to-date for 16 years (since 2002).

• Borrowing in the financial year ending (FYE) March 2018 was £39.8 billion: £5.7 billion less than in FYE March 2017; the lowest financial year for 11 years (since FYE 2007).

• This month we have introduced improvements to our treatment of Value Added Tax (VAT) refunds data; although public sector borrowing-neutral, VAT receipts have increased by £1.8 billion in the current financial YTD and £3.3 billion in FYE March 2018, with corresponding and offsetting increases in expenditure in those periods.

• Debt (Public sector net debt excluding public sector banks) at the end of September 2018 was £1,789.5 billion (or 84.3% of gross domestic product (GDP)); an increase of £3.4 billion (or a decrease of 2.4 percentage points) on September 2017.

• Debt at the end of September 2018 excluding Bank of England (mainly quantitative easing) was £1,599.4 billion (or 75.3% of GDP); a decrease of £38.0 billion (or a decrease of 4.2 percentage points) on September 2017.

• On 28 September 2018, we announced the reclassification of housing associations in Scotland from the public to the private sector; reducing debt at the end of September 2018 by £3.4 billion.

• Central government net cash requirement in the current financial YTD was £19.8 billion (£5.1 billion less than financial YTD 2017) or £20.5 billion excluding both UK Asset Resolution Ltd and Network Rail (£5.1 billion less than in financial YTD 2017).

In the UK, the public sector consists of five sub-sectors: central government, local government, public non-financial corporations, Bank of England and public financial corporations (or public sector banks).

Unless otherwise stated, the figures quoted in this bulletin exclude public sector banks (that is, currently only Royal Bank of Scotland (RBS)), as the reported position of debt (and to a lesser extent borrowing) would be distorted by the inclusion of RBS's balance sheet (and transactions). This is because government does not need to borrow to fund the debt of RBS, nor would surpluses achieved by RBS be passed on to government, other than through any dividends paid as a result of government equity holdings.

Public sector net borrowing excluding public sector banks (PSNB ex) measures the gap between revenue raised (current receipts) and total spending (current expenditure plus net investment (capital spending less capital receipts)). Public sector net borrowing is often referred to by commentators as “the deficit”.

The public sector net cash requirement (PSNCR) represents the cash needed to be raised from the financial markets over a period of time to finance the government’s activities. This can be close to the deficit for the same period but there are some transactions, for example, loans to the private sector, which need to be financed but do not contribute to the deficit. It is also close but not identical to the changes in the level of net debt between two points in time.

Public sector net debt excluding public sector banks (PSND ex) represents the amount of money the public sector owes to private sector organisations including overseas institutions, largely as a result of issuing gilts and Treasury Bills, less the amount of cash and other short-term assets it holds. Public sector net debt is often referred to by commentators as “national debt”.

While borrowing (or the deficit) represents the difference between total spending and receipts over a period of time, debt represents the total amount of money owed at a point in time.

The debt has been built up by successive government administrations over many years. When the government borrows (that is, runs a deficit), this normally adds to the debt total. So reducing the deficit is not the same as reducing the debt.

This section presents information on aspects of data or methodology that have been introduced or improved since the publication of the previous bulletin, along with supporting information users may find useful.

VAT refunds

We have completed a review of our recording of Value Added Tax (VAT) refunds data, in collaboration with both HM Revenue and Customs (HMRC) and HM Treasury (HMT).

VAT refunds provide an estimate of the amount of VAT claimed back by local authorities and central government departments; with the intention of recording the sales of services consumed by government on an equivalent basis, whether they are provided by government or by the private sector.

Given that this tax is recorded as income and expenditure for both local government or central government, any updates to VAT refunds data have no impact on public sector net borrowing.

This work has highlighted opportunities to improve our recording of the VAT refunds associated with the National Health Service, Academies, the BBC and Police Commissioners. Table 1 summarises the impact of these improvements on both the central and local government sectors. Figures may not sum due to rounding.

This month, we have introduced these improvements to our recording of VAT refunds data for financial year ending (FYE) March 2018 and FYE March 2019. We are currently compiling improved VAT refunds data for periods prior to FYE March 2018 and these will be reflected in our data in parallel with their implementation in the national accounts. Until then, there will be a temporary discontinuity in those time series highlighted in Table 1.

Housing associations

Following passage of the Housing (Amendment) (Scotland) Act 2018 and The Regulation of Social Housing (Influence of Local Authorities) (Scotland) Regulations 2018, we have completed an assessment of the registered social landlords (RSLs) in Scotland, which are often described as housing associations.

We have concluded that the RSLs in Scotland are private sector market producers and as such they should be reclassified to the private non-financial corporations sub-sector. This classification applies from 19 September 2018, the effective date of the legislation.

As a result of this reclassification, public sector net debt reduced by £3.4 billion at the end of September 2018 and public sector net borrowing will reduce by around £0.2 billion per financial year.

Only housing associations in Northern Ireland now remain classified within the public sector. The Department for Communities Northern Ireland launched a consultation on the future of House Sales Schemes in Northern Ireland, running between 3 July and 24 September 2018. We will review the classification of housing associations in Northern Ireland at an appropriate time based on the outcomes of this consultation.

Quarterly gross domestic product (GDP) updates

This month we have incorporated the latest estimates of GDP (published on 28 September 2018). As a result of including these data, our estimates of statistics (such as debt) expressed as a ratio of GDP have been revised for the period January 2017 to date.

Budget 2018

On 26 September 2018, the government confirmed that it will publish its next Budget on Monday 29 October 2018.

The independent Office for Budget Responsibility (OBR), responsible for the production of official forecasts for government, will publish updated forecasts for debt and borrowing, on which Budget 2018 is based, on 29 October 2018.

The OBR forecasts used in this bulletin are currently those published on 13 March 2018. Our next bulletin, to be published on 21 November 2018 will refer to the Budget 2018 forecasts.

In September 2018, the public sector spent more money than it received in taxes and other income. This meant it had to borrow £4.1 billion; that is, £0.8 billion less than the same period in September 2017. This is the lowest September net borrowing for 11 years.

Receipts in September 2018 increased by 3.2% compared with September 2017, to £56.4 billion, while total expenditure increased by 2.8% to £59.4 billion.

Much of the annual growth in receipts came from Value Added Tax (VAT), Income Tax and National Insurance contributions, while other taxes such as duties on both tobacco and Stamp Duty (on land and properties) have fallen marginally on September 2017.

This month, much of the increase in spending was in the current account, with notable growth in both the expenditure on goods and services as well as net social benefits. Over the same period, interest payments on the government’s outstanding debt have fallen; due largely to movements in the Retail Prices Index to which index-linked bonds are pegged.

In addition to the increase in current spending, increases in gross capital formation and capital transfers to the private sector were important factors in the year-on-year growth in the capital account.

Due to the volatility of the monthly data, the cumulative financial year-to-date borrowing figures often provide a better indication of the position of the public finances than the individual months.

Figure 1 summarises public sector borrowing by sub-sector in September 2018 and compares this with the equivalent measures in the same month a year earlier (September 2017). This presentation splits public sector net borrowing excluding public sector banks (PSNB ex) into each of its four sub-sectors: central government, local government, public corporations and Bank of England.

While local government data for September 2018 are based on budget forecasts for England, Wales and Scotland, public corporations data remain initial estimates, with most components calculated by Office for National Statistics (ONS) based on Office for Budget Responsibility (OBR) forecasts. In both cases, additional administrative source data are used to estimate transfers to each of these sectors from central government.

Figure 1: Contributions to public sector net borrowing (excluding public sector banks) by sub-sector

September 2018, compared with September 2017, UK

Source: Office for National Statistics

Notes:

1. PSNBex – Public sector net borrowing excluding public sector banks.

2. CGNB – Central government net borrowing.

3. LGNB – Local government net borrowing.

4. PCNB Non-financial public corporations net borrowing.

5. BoENB – Bank of England net borrowing.

6. L&P – Land and property.

7. I & W – Income and wealth.

8. Contributions to EU – UK VAT, GNI and abatement contributions to the EU budget.

9. NICs – National Insurance contributions.

Download this image Figure 1: Contributions to public sector net borrowing (excluding public sector banks) by sub-sector

.png (115.7 kB) .xls (88.1 kB)

In the financial year-to-date (YTD) (April to September 2018), public sector spending exceeded the money that it received in taxes and other income. This meant it had to borrow £19.9 billion; that is, £10.7 billion less than the same period in 2017. Borrowing so far this financial year was the lowest for any April to September period for 16 years.

Of this £19.9 billion borrowed by the public sector in this period, £5.5 billion related to the cost of the “day-to-day” activities of the public sector (the current budget deficit), while £14.4 billion was capital spending (or net investment), such as on infrastructure.

Figure 2 presents both monthly and cumulative public sector net borrowing (excluding public sector banks) in the current financial YTD (April to September 2018) and compares these with the previous financial year.

Figure 3 summarises the contributions of each sub-sector to public sector net borrowing (excluding public sector banks) in the current financial YTD (April to September 2018) and compares these with the same period in the previous financial year.

The difference between central government's income and spending makes the largest contribution to the amount borrowed by the public sector. In the latest financial YTD (April to September 2018), of the £19.9 billion borrowed by the public sector, £24.9 billion was borrowed by central government, while local government was in surplus by £4.9 billion.

In the current financial YTD, central government received £352.4 billion in income, including £265.6 billion in taxes. This was around 4% more than in the same period in 2017.

Over the same period, central government spent £368.0 billion, around 2% more than in the same period in 2017. Of this amount, just below two-thirds was spent by central government departments (such as health, education and defence), around one-third on social benefits (such as pensions, unemployment payments, Child Benefit and Maternity Pay), with the remaining being spent on capital investment and interest on government’s outstanding debt.

Figure 3: Contributions to public sector net borrowing (excluding public sector banks) by sub-sector

Current financial year-to-date (April to September 2018) compared with the same period last year, UK

Source: Office for National Statistics

Notes:

1. PSNBex – Public sector net borrowing excluding public sector banks.

2. CGNB – Central government net borrowing.

3. LGNB – Local government net borrowing.

4. PCNB Non-financial public corporations net borrowing.

5. BoENB – Bank of England net borrowing.

6. L&P – Land and property.

7. I & W – Income and wealth.

8. Contributions to EU – UK VAT, GNI and abatement contributions to the EU budget.

9. NICs – National Insurance contributions.

Download this image Figure 3: Contributions to public sector net borrowing (excluding public sector banks) by sub-sector

.png (123.7 kB) .xls (87.6 kB)

Figure 4 illustrates that annual borrowing has been generally falling since the peak in the financial year ending (FYE) March 2010 (April 2009 to March 2010).

In the latest full financial year (April 2017 to March 2018), the £39.8 billion (or 1.9% of gross domestic product (GDP)) borrowed by the public sector was around one-quarter of PSNB ex in the FYE March 2010, when borrowing was £153.1 billion (or 9.9% of GDP).

Figure 4: Public sector net borrowing (excluding public sector banks)

April 1993 to September 2018, UK

Source: Office for National Statistics

Notes:

1. Financial year 2017/18 represents the financial year ending 2018 (April 2017 to March 2018).

2. Office for Budget Responsibility (OBR) full financial year forecast of £37.1 billion for public sector net borrowing excluding public sector banks (March 2018 Economic and Fiscal Outlook).

3. Ytd equals year-to-date (April to September).

Download this image Figure 4: Public sector net borrowing (excluding public sector banks)

.png (42.8 kB) .xls (86.0 kB)

Public sector net debt (PSND ex) represents the amount of money the public sector owes to private sector organisations (including overseas institutions), that has built up by successive government administrations over many years.

When the government borrows, this normally adds to the debt total, but it is important to remember that reducing the deficit is not the same as reducing the debt.

At the end of September 2018, the amount of money owed by the public sector to the private sector stood at around £1.8 trillion (Figure 5), which equates to 84.3% of the value of all the goods and services currently produced by the UK economy in a year (or gross domestic product (GDP)).

Figure 5: Public sector net debt (excluding public sector banks)

March 1994 to the end of September 2018, UK

Source: Office for National Statistics

Notes:

1. Includes Asset Purchase Facility (APF), which includes the Term Funding Scheme (TFS).

2. Public sector net debt excluding public sector banks (PSND ex) is the combination of PSND ex Bank of England (BoE) plus BoE contribution to PSND ex.

Download this image Figure 5: Public sector net debt (excluding public sector banks)

.png (43.3 kB) .xls (67.1 kB)

The introduction of the Term Funding Scheme (TFS) in September 2016 led to an increase in net debt, as the loans provided under the scheme are not liquid assets and therefore do not net off in public sector net debt (against the liabilities incurred in providing the loans).

Since September 2017, the net debt associated with the Bank of England (BoE) increased by £41.4 billion to £190.1 billion. Nearly all of this growth was due to the activities of the Asset Purchase Facility Fund, of which the TFS is a part.

The TFS closed for drawdowns of further loans on 28 February 2018 with a loan liability of £127.0 billion. The TFS loan liability at the end of September 2018 was £126.4 billion.

If we were to exclude the activities of the BoE in the estimation of public sector net debt (excluding public sector banks), it would reduce by £190.1 billion, from £1,789.5 billion to £1,599.4 billion, or from 84.3% of GDP to 75.3%.

Figure 6 breaks down outstanding public sector net debt at the end of September 2018 into the sub-sectors of the public sector. In addition to public sector net debt excluding public sector banks (PSND ex), this presentation includes the effect of public sector banks on debt.

Figure 7 incorporates the borrowing components detailed in Figure 2 to illustrate how the differences between income and spending (both current and capital) have led to the accumulation of debt in the current financial year-to-date (April to September 2018).

The reconciliation between public sector net borrowing and net cash requirement is presented in more detail in Table REC1 in the Public sector finances Tables 1 to 10: Appendix A dataset.

Figure 7: Components of net debt

How the difference in expenditure and receipts affect public sector net debt (excluding public sector banks), UK

Source: Office for National Statistics

Notes:

1. Cash transactions in (non-financing) financial assets, which do not impact on net borrowing.

2. Timing differences between cash and accrued data.

3. Revaluation of foreign currency debt (for example, foreign currency). Debt issuances or redemptions above or below debt valuation (for example, bond premia and discounts and capital uplifts). Changes in volume of debt not due to transactions (for example, sector reclassification).

Download this image Figure 7: Components of net debt

.png (132.4 kB) .xls (60.4 kB)

Revisions can be the result of both updated data sources and methodology changes. This month, we have introduced improvements to our recording of Value Added Tax (VAT) refunds for the financial year ending March 2018 and the current financial year-to-date, for the first time. While this change is borrowing-neutral, in the periods affected there are resulting increases in accrued VAT receipts along with equal but offsetting increases in government expenditure, mainly on goods and services. Revisions to net borrowing are as a result of updated data sources only.

It is important to note that revisions do not occur as a result of errors; errors lead to corrections and are identified as such when they occur. This month we have no errors to report.

Table 2 presents the revisions to the headline statistics presented in this bulletin compared with those presented in the previous publication (published on 21 September 2018).

Revisions to public sector net borrowing (excluding public sector banks) in the current financial year-to-date (April to August 2018)

The data for the latest month of every release contain some forecast data. The initial outturn estimates for the early months of the financial year, particularly April, contain more forecast data than other months, as profiles of tax receipts, along with departmental and local government spending are still provisional. This means that the data for these months are typically more prone to revision than other months and can be subject to sizeable revisions in later months.

Public sector net borrowing excluding public sector banks (PSNB ex) has been revised down by £2.0 billion compared with figures presented in the previous bulletin (published on 21 September 2018). Of this £2.0 billion, £1.8 billion was due to updated central government data.

Previous estimates of central government receipts increased by £3.2 billion; due largely to a £1.9 billion increase in previous estimates of VAT. Of this £1.9 billion, £1.8 billion was due to improvements in our recording of VAT refunds, which are public sector borrowing neutral; being offset by a corresponding increase in expenditure mainly on goods and services.

In addition to the reported increase in VAT receipts, estimates of Income Tax and tobacco duties increased by £1.2 billion and £0.4 billion respectively, while National Insurance contributions reduced by £0.8 billion.

Over the same period, estimates for central government current expenditure increased by £1.5 billion; due largely to the increases in expenditure on goods and services associated with the improvements in the recording of VAT refunds.

Revisions to public sector net borrowing (excluding public sector banks) in the financial year ending March 2018

While the previously published estimate of public sector net borrowing excluding public sector banks (PSNB ex) in the financial year ending March 2018 has only been revised downwards by £0.1 billion, improvements to the recording of VAT refunds introduced this month have resulted in a £3.3 billion increase in VAT receipts. This increase in receipts was almost entirely offset by a corresponding increase to government expenditure.

Figure 8 breaks down this revision to PSNB ex by each of its four sub-sectors: central government, local government, non-financial public corporations and Bank of England (BoE).

Figure 8: Revisions to net borrowing

Latest data covering April to August 2018, compared with that presented in the previous bulletin (21 September 2018), UK

Source: Office for National Statistics

Notes:

1. PSNBex – Public sector net borrowing excluding public sector banks.

2. CGNB – Central government net borrowing.

3. LGNB – Local government net borrowing.

4. PCNB Non-financial public corporations net borrowing.

5. BoENB – Bank of England net borrowing.

6. L&P – Land and property.

7. I & W – Income and wealth.

8. Contributions to EU – UK VAT, GNI and abatement contributions to the EU budget.

9. NICs – National Insurance contributions.

Download this image Figure 8: Revisions to net borrowing

.png (145.9 kB) .xls (88.6 kB)

Revisions to public sector net debt (excluding public sector banks) expressed as a percentage of GDP

This month we have incorporated the latest estimates of gross domestic product (GDP) (published on 28 September 2018). As a result of including these improved data, our estimates of public sector net debt statistics expressed as a ratio of GDP have been revised for the period March 2017 to date.

Improvements to public sector net financial liabilities (PSNFL)

Can you please add the following heading and paragraph at the end of section 6.

Improvements to public sector net financial liabilities (PSNFL)

This month we have improved the monthly profile calculations applied to data used in the compilation of public sector net financial liabilities statistics, as presented in Table PSNFL 3. This improvement to the monthly profile leads to revisions in the inter-quarter months, however, there are no revisions to the quarterly data. Taking Quarter 1 (Jan to Mar) 2018 as an example, the profile revises in the months January and February but remain unchanged in March. Therefore Tables PSNFL 1 and PSNFL 2 are unaffected as these are presented on a quarterly basis only. These improvements have led to monthly revisions in the financial transactions, other accounts payable / receivable (AF.8), loan assets (AF.4) and equity assets (AF.5) back to April 2000.

The independent Office for Budget Responsibility (OBR) is responsible for the production of official forecasts for government. These forecasts are usually produced twice a year (currently in March and November).

OBR forecasts used in this bulletin are based on those published on 13 March 2018.

Table 3 compares the current outturn estimates for each of our main public sector (excluding public sector banks) aggregates for the latest full financial year with corresponding OBR forecasts for the following financial year. Further, it compares the current financial year-to-date (April to September 2018) outturn estimates with those of the previous financial year.

Caution should be taken when comparing public sector finances data with OBR figures for the full financial year. Data are not finalised until some time after the financial year ends, with initial estimates made soon after the end of the financial year often subject to sizeable revisions in later months as forecasts are replaced with audited outturn data.

There may also be known methodological differences between OBR forecasts and outturn data.

The UK government debt and deficit statistical bulletin is published quarterly (in January, April, July and December each year), to coincide with when the UK and other EU member states are required to report on their deficit (or net borrowing) and debt to the European Commission.

On 19 October 2018, we published UK government debt and deficit: June 2018, consistent with Public sector finances, UK: August 2018 (published on 21 September 2018). In this publication we stated that:

• general government gross debt was £1,763.8 billion at the end of March 2018, equivalent to 85.6% of gross domestic product (GDP); 25.6 percentage points above the Maastricht reference value of 60.0%

• general government deficit (or net borrowing) was £40.9 billion in the financial year ending (FYE) March 2018, equivalent to 2.0% of GDP; 1.0 percentage point below the Maastricht reference value of 3.0%

The UK general government debt and deficit data we published on 19 October 2018 will be published by Eurostat on 22 October 2018 in context with the other 27 EU member states.

It is important to note that the GDP measure, used as the denominator in the calculation of the debt ratios in the UK government debt and deficit statistical bulletin, differs from that used within the Public sector finances statistical bulletin.

The public sector finances Quality and Methodology Information (QMI) report contains important information on:

• the strengths and limitations of the data and how it compares with related data

• uses and users of the data

• how the output was created

• the quality of the output including the accuracy of the data

The public sector finances methodological guide provides a comprehensive contextual and methodological information concerning the monthly Public sector finances statistical bulletin.

The guide sets out the conceptual and fiscal policy context for the bulletin, identifies the main fiscal measures and explains how these are derived and inter-related. Additionally, it details the data sources used to compile the monthly estimates of the fiscal position.

Local government forecasts

In recent years, planned expenditure initially reported in local authority budgets has systematically been higher than the final outturn expenditure reported in the audited accounts. We therefore include adjustments to reduce the amounts reported at the budget stage. Our adjustments for the whole financial year ending (FYE) March 2019 are £1.0 billion for current expenditure on goods and services and £0.7 billion for capital expenditure.

The £1.0 billion adjustment for current expenditure on goods and services applies to England only. The £0.7 billion adjustment for capital expenditure comprises £0.5 billion for Scotland and £0.2 billion for Wales. No adjustment is made for England capital expenditure because similar adjustments were already applied in the published England local authority budget data.

This section presents information on aspects of data or methodology that are planned but not yet included in the public sector finances.

Further, in our article Looking ahead: developments in public sector finance statistics, we provide users with early sight of those areas where the fiscal statistics may be significantly impacted upon by methodological or classification changes during the coming 24 months.

Fines and penalties

We are currently investigating our recording of fines and penalties for the late payment of taxes to HM Revenue and Customs (HMRC).

Any additional revenue identified and recorded by the inclusion of such payments will increase central government receipts and so reduce public sector net borrowing.

Based on our ongoing investigation, we expect borrowing to reduce by around £0.7 billion in the financial year ending (FYE) March 2018 due to this revenue increase. We will introduce these changes at the earliest opportunity.

Any revisions to fines and penalties data for periods prior to FYE March 2018 will be implemented at a future point once further investigations are concluded.

The treatment of pensions in public sector finances

On 31 August 2018, our consultation concerning the treatment of pensions within the public sector finances closed. We are currently considering the feedback we received and plan to publish a response at the end of November 2018.

The sale of railway arches

On 11 September 2018, Network Rail announced they had agreed terms for the sale of its Commercial Estate business in England and Wales, the majority of the properties in which are railway arches. We are currently investigating the nature of the transaction in order to ensure that the impacts will be fully reflected in the public sector finances.

Recent announcements concerning the Term Funding Scheme

On 21 June 2018, the government published a new Memorandum of Understanding between HM Treasury and the Bank of England (BoE), which sets out the financial relationship between the two institutions.

This memorandum announced that during the current financial year (April 2018 to March 2019), the £127 billion liabilities of the Term Funding Scheme (TFS ) (PDF, 1.4MB) will be transferred from the Bank of England Asset Purchase Facility Fund (APF) to the BoE’s own balance sheet and that the HM Treasury indemnity for it was being removed.

TFS was introduced in 2016, as a quantitative easing measure under the APF umbrella, to enable financial institutions to cut the time in passing on interest rate reductions to consumers and businesses.

This change will have no impact on public sector net debt (both including and excluding public sector banks).

Further, to enable the BoE to take TFS on balance sheet without an indemnity from the Treasury, a capital injection of £1.2 billion from HM Treasury to the BoE has been announced. The nature of the capital injection will be formally discussed at a classifications meeting and announced in due course.

East Coast Mainline

On 16 May 2018, the government announced that from 24 June 2018, London North Eastern Railway (LNER) will take over the running of East Coast Mainline services. On 31 August 2018, we announced that LNER would be classified to the public non-financial corporations sub-sector, effective from 14 February 2018. We are currently investigating the implications of this decision and our conclusions will be announced in due course.

EU withdrawal agreement

On 8 December 2017, the government published a joint report on progress during phase 1 of negotiations between the European Union and the UK (PDF, 383KB), under Article 50 of the Treaty on European Union (TEU) on the UK’s orderly withdrawal from the EU.

Although the Office for Budget Responsibility (OBR) discusses the EU settlement in Annex B (PDF, 2.5MB) of their Economic and Fiscal Outlook - March 2018, the details in the report are still subject to negotiation and so there is insufficient certainty at this stage for us to complete a formal assessment of impact on the UK public sector finances.

Carillion insolvency

Following Carillion Plc declaring insolvency on 15 January 2018, the UK government announced that it will provide the necessary funding required by the Official Receiver, to ensure continuity of public services through an orderly liquidation. The Official Receiver has been appointed by the court as liquidator, along with partners at PwC that have been appointed Special Managers. The defined benefit pension schemes of former Carillion employees are currently being assessed by the Pension Protection Fund (PPF) prior to any transition into the PPF scheme.

We are currently investigating the various impacts of the liquidation of Carillion on the public sector finances, including in relation to the public-private partnership projects in which Carillion was involved and the additional funding that the government has provided in order to maintain public services. We will announce our findings in due course.

Prior to liquidation, Carillion held approximately 450 contracts with government, representing 38% of Carillion’s 2016 reported revenue.

Time series data

All data contained within these publications are available to download via the public sector finances time series dataset. From April 1997 to date, where available, time series are presented as monthly data, with series extending further back in time, generally presented on a quarterly or financial year basis.

Time series exclusive to the public sector finances borrowing by sub-sector presentation are only available as quarterly time series, though these extend back to 1946.

Supporting documentation

Documentation supporting this publication is available in appendices to the bulletin:

• Public sector finances Tables 1 to 10: Appendix A

• Large impacts on public sector fiscal measures excluding banking groups: Appendix B

• Public sector finances revisions analysis on main fiscal aggregates: Appendix C

• Public sector current receipts: Appendix D

• Impact of the reclassification of housing associations into the public sector: Appendix E

• Revisions to the first reported estimate of public sector net borrowing: Appendix F

Public sector borrowing by sub-sector

Each month, at 9:30am on the working day following the Public sector finances statistical bulletin, we publish Public sector finances borrowing by sub-sector. This release contains an extended breakdown of public sector borrowing in a matrix format and also estimates of total managed expenditure (TME).