There have been celebrations this morning about a government surplus of £5.4 billion last month, and people are even talking about a ‘windfall’ for Chancellor Jeremy Hunt in next month’s Budget. But all this shows is how conditioned we have become to appalling economic news – and that we will grab at anything which seems to indicate a shaft of light.

Nevertheless, any talk of a government ‘surplus’ masks the very real problem the government still has

While any surplus is to be welcomed – and last month’s borrowing figures are far better than the Office for Budget Responsibility predicted – we would be in serious trouble if the government had not succeeded in running a surplus last month. It is not the same as any other month: it is one of two months in the year – the other being July – when self-assessment tax is due. Indeed, last month the government received £21.9 billion in revenue from this source. Without that, government finances for the month would have been deeply in the red.

The more relevant figure for understanding public finances is that in the financial year to date, the government has borrowed £116.9 billion. That is not a surplus. It is a very large deficit, such as UK governments have run every year for the past two decades. Government debt is currently running at 98.9 percent of GDP – the highest rate since the 1960s. That is why, by the end of this financial year, the government will have spent more than £100 billion merely servicing its debts. If we weren’t bearing the cost of past borrowing, we could have another two-thirds of an NHS for the same money.

But the most shocking figure contained within today’s release by the Office for National Statistics is this: government spending last month was £20.1 billion higher – or 24 per cent higher – than in January last year. A large part of that was down to the energy bills support scheme. But there was also a hit from historic customs duties owed to the EU as a result of a ruling by the European Court of Justice that the UK has been negligent in allowing cheap Chinese imports to flood the single market during its membership of the EU.

This ruling comes at a time when Rishi Sunak is trying to convince his MPs to support a deal on the Northern Ireland Protocol which would recognise the ECJ as the ultimate arbiter in disputes over trade between the UK and Ireland. So this historic bill is somewhat inconvenient in a political, as well as fiscal, sense.

Thankfully, the cost of wholesale energy has plummeted from its peak last summer when the energy bills support scheme was devised. Its estimated cost is now likely to be a lot less than the £100 billion-plus figure predicted at one stage. By the middle of the year, it is likely that the scheme will not be costing the government anything at all. Nevertheless, any talk of a government ‘surplus’ – just because one month’s borrowing figures were in the black – masks the very real problem the government still has: how to stop the explosive growth in the reach of the state, which has been evident since the beginning of the pandemic.