The government on Wednesday forecast wider budget deficits and higher debt over the next three years, even as it anticipated better growth prospects due to improved electricity supply.

The Treasury forecasted a 5.0% deficit for the fiscal year ending March 2025, up from the 4.5% expected, with next year’s deficit now estimated at 4.3% of GDP.

The National Treasury had to lower its 2024 economic growth forecast from 1.3% in the 2024 budget to 1.1% but placed its growth outlook for the medium-term period from 1.2% in the preceding three years to 1.8% from 2025 to 2027.

The government's official forecaster raises its prediction for UK growth in 2024 and 2025 but reduces it for later years.