UK Public finances improving

July is usually the second highest month for receipts during the financial year, with many firms paying the first of four corporation tax payments on their profits, and the second payment on account for self-assessment liabilities for the previous financial year. Despite the revised projections in the July 2015 Budget setting a more ambitious timetable for the improvement of the public finances in 2015/16 relative to the March projections, outturns for the first three months are already a little ahead of plan for the full financial year.

Nevertheless, revisions over the course of the year can change the picture quite dramatically, leading even detailed forecasts astray. 

"For July, we look for net repayment of £1.0bn on the ex banks measure, an improvement on net borrowing of £0.1bn in 2014/15, and a repayment of £1.8bn on the headline measure," notes Lloyds Bank.