{"text":[[{"start":8.762,"text":"The UK posted an unexpected budget deficit in July while retail sales fell for the first time in three months, underlining the pressure on chancellor John Healey to maintain tough fiscal discipline in his first Budget."}],[{"start":22.1,"text":"Friday’s data from the Office for National Statistics showed the government’s budget deficit hit £1.8bn in July, up £700mn compared with the same month a year earlier."}],[{"start":33.012,"text":"The borrowing figure was £2.3bn above the forecast from the Office for Budget Responsibility, while economists polled by Reuters had also expected the budget to be in balance in July."}],[{"start":44.151,"text":"The Conservatives highlighted that UK government debt is approaching the £3tn mark: it increased by £96bn from a year earlier to £2,985bn, equivalent to 94 per cent of GDP."}],[{"start":59.24,"text":"With long-term government borrowing costs rising globally, Healey said: “Fiscal discipline is the bedrock of our UK economic stability and national security, which is why we are committed to meeting our fiscal rules, with a buffer against global uncertainties.”"}],[{"start":74.36,"text":"The unexpected rise in the deficit came as government spending outpaced higher tax receipts, the ONS said."}],[{"start":80.473,"text":"Net borrowing is typically low in July due to a self-assessment tax return deadline, which produces a seasonal boost to government receipts."}],[{"start":89.56,"text":"The data was released in the wake of investors and analysts warning the new chancellor to limit borrowing and not to relent in efforts to reduce the UK’s fiscal deficit in his first Budget on October 28."}],[{"start":101.6,"text":"The UK public finances have come under pressure in recent months from changing market rate expectations and rising government bond yields."}],[{"start":108.915,"text":"This has eroded the fiscal headroom set out by the government in March, leaving Prime Minister Andy Burnham with difficult tax and spending choices in October if he wants to deliver on his economic vision for the country."}],[{"start":null,"text":"
"}],[{"start":121.76,"text":"“July’s public finances figures continued the recent run of bad news on the fiscal position and highlight the limited scope for extra public borrowing,” said Ashley Webb, senior UK economist at consultancy Capital Economics, adding that market interest rates were likely to have already cut the fiscal headroom to about £17bn from £24bn in March."}],[{"start":143.48,"text":"“This state of affairs makes the autumn Budget increasingly important,” said Joe Nellis, head of economic research at MHA, the accountancy and advisory firm."}],[{"start":153.36,"text":"“A difficult balancing act remains: maintaining financial credibility with financial markets while avoiding policies that unnecessarily weaken the economy,” he added."}],[{"start":163.84,"text":"Healey attempted to reassure markets on Friday. “We are cutting the deficit faster than any other G7 economy, while giving people a bit of breathing space with cost of living pressures and focusing support to get young people into work,” he said."}],[{"start":177.3,"text":"But Sir Mel Stride, shadow chancellor, said: “Only the Conservatives have a credible plan to get the national debt down with £50bn in spending cuts, starting with the welfare bill, and a golden economic rule to ensure the majority of those savings are used to cut the deficit.”"}],[{"start":191.72,"text":"ONS figures released on Friday showed that spending growth outpaced receipts despite strong self-assessed income tax revenue, which was up almost 10 per cent on the same month last year."}],[{"start":204.041,"text":"Central government expenditure on net social benefits was £2bn higher in July than the same month last year, while spending on goods and services — which includes staff costs — was up £1.2bn."}],[{"start":219.36,"text":"Inflation-linked changes to payments and earnings-linked state pension rises are the main drivers of movements in benefits spending, the ONS said."}],[{"start":224.988,"text":"Separate data published by the ONS on Friday showed retail sales fell in July for the first time in three months, after rising sharply the month before amid hot weather and sales promotions."}],[{"start":236.987,"text":"Retail sales dropped 0.5 per cent in July, the ONS said, after a 0.7 per cent rise the previous month."}],[{"start":244.451,"text":"Annual sales volumes were up 1.6 per cent, below the 2.2 per cent forecast by economists polled by Reuters."}],[{"start":null,"text":""}],[{"start":251.474,"text":"In better news for Healey, Friday’s S&P Global Flash UK PMI showed stronger than expected service sector growth in August, with activity rising at the fastest pace in six months. This drove the fastest expansion of private sector output since April despite a slowdown in manufacturing production."}],[{"start":270.6,"text":"Separately, the GfK consumer confidence index, a measure of how people view their personal finances and broader economic prospects, unexpectedly rose to the highest level in two years this month."}],[{"start":280.08,"text":"Chris Williamson, chief business economist at S&P Global Market Intelligence, said businesses were feeling more upbeat than at any time since the Middle East war began but concerns about domestic policy “continue to have a damaging effect”."}],[{"start":302.18,"text":"“Most worryingly, cost pressures remain high,” he added. “The data suggest the Bank of England looks likely to keep a hawkish bias but will stay cautious, holding off any rate hikes until the growth and inflation trajectories become clearer.”"}],[{"start":310.669,"text":"Sterling was steady on Friday morning at $1.365."}],[{"start":320.64,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1787307411_1016.mp3"}