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ICAEW responds to January 2022 public sector finance numbers

Author: ICAEW

Published: 25 Feb 2022

Alison Ring OBE FCA, Public Sector and Taxation Director for ICAEW, responds to the public sector finance numbers for January released by the Office for National Statistics today (Tuesday 22 February 2022).

Alison said: “The strong tax receipts reported today will provide a welcome respite for the public finances, reducing the shortfall in the government’s income compared with its expenditure from previous forecasts. However, the deficit is still on track to be the third highest ever recorded in peacetime, while public debt is more than half a trillion pounds higher than it was at the start of the pandemic.

“The challenge for Rishi Sunak will be balancing the strong pressures on him to increase the support package for households facing rapidly rising energy costs and retail prices, with the need to strengthen the resilience of the public finances in the face of a great deal of economic uncertainty and increasing global security concerns. The Chancellor will be acutely aware that while inflation is adding to tax revenues today it will go on to add to public spending tomorrow.”