British official public deficit higher than expected in June, data shows

British public sector borrowing was higher than expected in June, official data showed yesterday, in a blow to government hopes of slashing the huge public deficit.

The public deficit, known as the public sector net borrowing requirement, the government's preferred measure of public finances, stood at £14.5 billion, the Office for National Statistics said in a statement. The reading was higher than market expectations for a deficit of £13.5 billion, but was a slight improvement from £14.7 billion in June last year.

"The public finances were worse than expected, providing a blunt reminder to Chancellor George Osborne of the major task that he faces in returning the public finances to health," said IHS Global Insight economist Howard Archer.

"Indeed, the PSNBR was an eye-wateringly high £14.5 billion in June, although at least this was marginally down on the shortfall a year earlier." The ONS added that the public sector net cash requirement - an alternative measure of public finances - expanded last month to show a deficit of £20.9 billion, compared with £20.2 billion in June 2009.

"June's UK public finances figures put a bit of a dent in hopes that the fiscal position is now on a clearly improving trend," added Capital Economics analyst Jonathan Loynes.

Chancellor of the Exchequer George Osborne last month unveiled higher taxation and spending cuts in an emergency budget aimed at narrowing the nation's enormous public deficit.

The Conservative-Liberal Democrat coalition which took power after a general election in May inherited a record £154.7 billion deficit from the previous Labour government.

The goal is to reduce the shortfall to £37 billion in 2014-2015 and to £20 billion in 2015-2016.