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Brown gets birthday gift. By Dawn Smith

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21st Feb 2006
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Gordon Brown, who celebrated his birthday this week, will be raising a glass to the latest public finance figures, which show the public sector current budget was in surplus by £15.3 billion last month (£3 billion higher than January last year), while net lending was £12.6 billion (up from £8.8 billion in January 2005).

The perky January figures, released on Monday by the National Statistics Office, mean that for the financial year to date, the public sector current budget is in deficit by £7.8 billion, and public sector net borrowing stands at £29.8 billion. As a result, the Chancellor could be on target to meet his pre-budget report forecasts for this financial year. He's aiming for a public sector current deficit of £10.6 billion; and public sector net borrowing of £37 billion.

The main reason for the January boost was a rise in tax revenues, rather than a cut in spending. Tax receipts in January 2006 were £54 billion, compared to £47.2 billion in the same month last year, while public expenditure was £3 billion higher last month than in January 2005. Both Income Tax and Corporation Tax revenues jumped, with Income Tax receipts around £1.5 billion higher and Corporate Tax receipts more than £3.6 billion higher this January than during the same month a year ago.

The friendly figures will undoubtedly put a spring in Gordon's step as he gears up for the budget on 22 March. They make it more likely that he will meet his golden rule on only borrowing to invest over the economic cycle, and less likely that he will be forced to hike taxes in the short term in order to stick to that rule.

Read the statistics in full on the National Statistics Office website.

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