Reductions in local government borrowing have helped the Treasury keep its public sector finances on target at the end of the financial year 2006-07, and chancellor Gordon Brown to keep his ‘golden rule'. Figures released by the Office for National Statistics show overall local government borrowing fell during the financial year to end the year on zero, compared with some £3.3bn for 2005-06. Public sector borrowing for the year was £33.6bn – about £1.4bn less than the Budget forecast of £35bn, and £4.4bn lower than 2005-06 when it stood at £38bn. Both government and public sector borrowing overall rose in March, local government borrowing over the month fell to just £500m compared with £1.2bn in March last year. The ONS statistics show that government borrowing in March rose to £7.6bn compared with £5.9bn in 2005-06, while public sector borrowing rose from £6.6bn in March 2006 to £8.5bn this March. Gemma Tatlow, at the Institute for Fiscal Studies, said: ‘Figures show that Gordon Brown's golden rule has been met, with almost £10bn to spare over the 10-year economic cycle that the Treasury estimates to have run from 1997-98 to 2006-07.'
