Public finance is the term used to refer to the finances of the government – how much is coming in (through taxes, bonds, etc), and how much is going out (spending on public services, for example). A key part of public finance is the national deficit, which is when the government is spending more than it earns. It’s also called “net borrowing”.
So far, the national deficit has shrunk since 2017. Compared to GDP (Gross Domestic Product – a monetary measure of a country’s wealth by valuing all final goods and services within the year), it has decreased from 2.3% in 2016/17, to 2.1% in 2017/18, to 1.2% in 2018/19.
So far then, the government looks to be on target. Because the promise is to continue the reduction “over the course of the next parliament” we are marking this as ‘in progress’ and will make a final call when the time comes. Follow this policy for updates.
Want to check how things add up?
- UK government deficit and debt, March 2019 – Office for National Statistics
- ONS estimates for public service productivity, 2019 – Office for National Statistics
- Government policy paper – Budget 2018 – Gov.uk
- ONS UK government deficit and debt, March 2018 – Office for National Statistics
- Government policy paper – Autumn Budget 2017 – Gov.uk
- Chancellor Phillip Hammond’s Autumn statement 2016 – Gov.uk
- The New Charter for Budget Responsibility (2016) – Gov.uk