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Senedd election (PA Wire)

The UK government borrowed another £31.7 billion in April as it fought to protect the economy from the worst ravages of Covid-19.

That was £15.6 billion less than the same month a year ago, but still the second highest for April since records began in 1993.

The lower borrowing is a sign of recovery, as furlough ends and lockdowns ease.

Tax receipts to the government grew by £3.8 billion to £58 billion.

The figures are better than the Office for Budget Responsibility had predicted only two months ago.

Ruth Gregory at Capital Economics said this reinforces “our view that the tax cuts and spending cuts that most fear may be avoided”.

Chancellor of the Exchequer Rishi Sunak said: “At the Budget, I set out the steps we are taking to keep the public finances on a sustainable footing by bringing debt under control over the medium term. But we also need to focus on driving a strong economy recovery from the pandemic. That is why the Government is continuing a comprehensive package of support to help businesses and workers get back on their feet – and the evidence shows that our Plan for Jobs is working.”

The furlough scheme is estimated to have cost £60 billion so far.

The UK economy is expected to bounce back strongly this year, with GDP growth of perhaps 7% or 8%.

Capital added: “We have been saying since the end of last year that rapid economic growth would quickly improve the outlook for the public finances. That means the Chancellor may be spared having to implement his proposed tax hikes/spending cuts before the 2024 general election. It seems that others are just about starting to adopt this view.”

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