PRESS RELEASE : PwC comments on ONS’ January public sector finances [February 2023]

The press release issued by PWC on 21 February 2023.

Jake Finney, economist at PwC UK, says:

“Net borrowing was in surplus by £5.4bn in January, which was £5bn higher than the Office for Budget Responsibility (OBR) expected. This indicates that the improved economic outlook is gradually starting to ease the pressures on the UK’s public finances.

“Tax receipts picked up in January, as workers and companies settled their tax bills. However, this was partially offset by large spending on energy bills support and one-off payments to the EU relating to historic custom duties.

“Debt interest payments reached £6.7bn in January, the highest January figure since monthly records began 26 years ago. This reflects the fiscal consequences of higher RPI inflation and higher interest rates. Higher debt servicing costs as a share of total revenues will leave the public finances more exposed to future economic shocks.

“In the coming months, falls to natural gas futures prices should start to gradually bring down the cost of the Energy Price Guarantee scheme. However, we expect this will be partially offset by reduced tax receipts due to lower than expected inflation.”