Boost for Chancellor as borrowing unexpectedly falls

Government borrowing unexpectedly improved last month, boosting Chancellor Philip Hammond's efforts to shore up the public finances ahead of Brexit.

Figures from the Office for National Statistics (ONS) show public sector net borrowing, excluding state-owned banks, fell by £200 million to £8.7 billion in November.

The move was below economists' predictions, who had pencilled in borrowing to reach £9 billion last month.

The deficit excluding banks for the current financial year - April to November - hit its lowest level in a decade, dropping by £3.1 billion to £48.1 billion over the period.

Britain's fiscal watchdog slashed its expectations for Government borrowing this year to £49.9 billion in the Autumn Budget, but hiked the outlook for 2019 and beyond as it expects paltry productivity growth to drag on the UK economy.

Updating on its forecasts last month, the Office for Budget Responsibility (OBR) called into question the Chancellor's target for balancing the books within the next Parliament, saying the Government may not eradicate the deficit before 2031.

On debt, the ONS revealed that public sector net debt, excluding state-owned banks, increased by £72.2 billion to £1,734.8 billion in November, equivalent to 84.6% of gross domestic product (GDP).

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