Chancellor misses his target for government borrowing
George Osborne was dealt a blow in his efforts to shore up the nation's finances after official figures showed the Chancellor missed his borrowing target for the year.
The Office for National Statistics (ONS) said the budget deficit stood at £74bn for the financial year ending in March.
The Office for Budget Responsibility (OBR) forecast borrowing to hit £72.2bn for 2015/16, meaning the Chancellor overshot his borrowing target by £1.8bn.
But while Mr Osborne missed his target for the year, he still managed to drive down borrowing by £17.7bn year-on-year.
Mr Osborne has pledged to return the UK to a surplus by 2020, with the OBR forecast stating that the UK would have a budget surplus of £10.4bn in 2019/20 and £11bn the year after.
But the Chancellor is now expected to see the deficit shrink more slowly than previously thought, with the OBR expecting it to reach £55.5bn in 2016/17.
In a hearing with MPs on the Treasury Select Committee following the Budget, OBR chairman Robert Chote said there was still a 55% chance that Mr Osborne would hit his surplus target despite making a U-turn on disability payment cuts.
The ONS also said borrowing hit a better-than-expected £4.6bn in March, falling £2.6bn year-on-year.
It added that the Government saved £1.3bn on the cost of "day-to-day" activities of the public sector, but spent £6.1bn on infrastructure.
Public sector net debt, excluding public sector banks, increased by £47.5bn year-on-year to £1,594bn to the end of March, the equivalent to 83.5% of gross domestic product.
A spokesman for the Treasury said the "figures confirm that the record post-war deficit we inherited has been cut by almost two thirds as a share of GDP.
"We are borrowing £18bn less than last year and March's monthly borrowing was the lowest for a decade.
"But while the deficit is falling, the job of repairing the public finances is not done and the Budget set out action to ensure that debt falls in 2016-17 and Britain is back in the black by the end of this parliament."