Monday 30 March 2015


Britain’s deficit was £48billion larger than forecast when the Coalition took power as less income tax than expected flowed into Treasury coffers because of wage stagnation, the Office for Budget Responsibility said today.

Britain’s deficit stood at £108billion in the last financial year, with the income tax hole accounting for £25billion of the £48billion shortfall.

The OBR said its forecast from 2010 were over-optimistic because it did not consider the effect of lower wages and salaries as well as a higher levels of tax-free personal allowance on income tax. National Insurance contributions were also £7.4billion below forecast.