Discussion
UK Debt is 2.7 trillion. 120 billion in interest payments alone.
Overspending is about 120 billion a year so on target for 3 trillion then will double in 5 years based on previous figures.
Local governments are in 100 billion debt.
I see no mention by any parties on cut backs, or even how to tackle it.
Some local councils spend more servicing debt rather than residents. UK Debt, 120 billion a year on just on interest debt payments.
Why does it feel like no one really cares about debt anymore, it is a very recent thing like last 15 years or so.
2022-23 interest only payments were 83 billion, 5.2% of total spending.
https://obr.uk/forecasts-in-depth/tax-by-tax-spend...
Overspending is about 120 billion a year so on target for 3 trillion then will double in 5 years based on previous figures.
Local governments are in 100 billion debt.
I see no mention by any parties on cut backs, or even how to tackle it.
Some local councils spend more servicing debt rather than residents. UK Debt, 120 billion a year on just on interest debt payments.
Why does it feel like no one really cares about debt anymore, it is a very recent thing like last 15 years or so.
2022-23 interest only payments were 83 billion, 5.2% of total spending.
https://obr.uk/forecasts-in-depth/tax-by-tax-spend...
Edited by mickythefish on Wednesday 24th January 09:28
I suspect that it will be a key debating point during the next election.
Labour are looking to spend £140billion over the life of the next Parliament on green investments alone, while claiming that they do not intend increasing personal taxation.
Meanwhile the Tories will claim that they will bring down debt due to falling interest rates and putting money into consumer’s pocket to boost the economy. In fairness they are on the right path by at least trying to balance the annual budget, but largely ignoring the problems of Councils, a Navy that can only protect Portsmouth and an undermanned army when the world is suddenly looking very dangerous.
Both will ignore the reality that the country blew so much cash during the pandemic that it will be seriously in hock for evermore.
A huge national debt will be a reality for most people interested in Politics and the economy.
Labour are looking to spend £140billion over the life of the next Parliament on green investments alone, while claiming that they do not intend increasing personal taxation.
Meanwhile the Tories will claim that they will bring down debt due to falling interest rates and putting money into consumer’s pocket to boost the economy. In fairness they are on the right path by at least trying to balance the annual budget, but largely ignoring the problems of Councils, a Navy that can only protect Portsmouth and an undermanned army when the world is suddenly looking very dangerous.
Both will ignore the reality that the country blew so much cash during the pandemic that it will be seriously in hock for evermore.
A huge national debt will be a reality for most people interested in Politics and the economy.
Yet we are constantly told how wealthy the country is...
As for voters, I think very few care a jot about it, all they want is more free stuff and the government that will spend the most. Because balancing the books and living within your means is 'austerity', right?
As for voters, I think very few care a jot about it, all they want is more free stuff and the government that will spend the most. Because balancing the books and living within your means is 'austerity', right?
Edited by Simpo Two on Wednesday 24th January 09:58
Public sector borrowing fell to £7.8bn last month, about half the sum from a year earlier and the lowest figure for a December since 2019,
Only £7.8bn borrowed in one month!!! This seems like an astonishing amount. Someone needs to get a grip if you ask me and increase tax. Won’t be popular but do it at the start of the next parliament and we will all forget after a few years.
Only £7.8bn borrowed in one month!!! This seems like an astonishing amount. Someone needs to get a grip if you ask me and increase tax. Won’t be popular but do it at the start of the next parliament and we will all forget after a few years.
It's worse than that, the 2.7 trillion doesn't include unfunded state sector pensions, which are another trillion on top.
There has been a budget deficit every single year since 2001, and real terms spending has gone up every year over the same time frame except for one small reduction in 2014 which was a slight nod to austerity (but was still a deficit that year).
Neither party is proposing to do anything about it, but you all keep voting for these idiots so WTH.
There has been a budget deficit every single year since 2001, and real terms spending has gone up every year over the same time frame except for one small reduction in 2014 which was a slight nod to austerity (but was still a deficit that year).
Neither party is proposing to do anything about it, but you all keep voting for these idiots so WTH.
rdjohn said:
Both will ignore the reality that the country blew so much cash during the pandemic that it will be seriously in hock for evermore.
This, crazy amounts of Covid party money were printed and handed out to people which is why we ended up having high levels of inflation.Does it really matter that we have high UK debt?
Tax income is near enough 1 trillion.
I think the issue is trying to grow the economy out of debt, just doesn't work.
I can't be the only one to see civil pensions, all the different political bs, remove second homes, move to more virtual events become proper streamlined. You can keep saying we are richest in world whilst living in increasing debt.
Key priority should be getting debt free in 10 years. I think debt is hiding massive inefficiencies in the system.
People used to moan when the government overspent 30 billion over the whole year lol.
I think the issue is trying to grow the economy out of debt, just doesn't work.
I can't be the only one to see civil pensions, all the different political bs, remove second homes, move to more virtual events become proper streamlined. You can keep saying we are richest in world whilst living in increasing debt.
Key priority should be getting debt free in 10 years. I think debt is hiding massive inefficiencies in the system.
People used to moan when the government overspent 30 billion over the whole year lol.
It’s the same from the very top to the absolute bottom.
Nobody gives a damn about debt anymore. If they can service the monthlies, they don’t care,
Idiots who should be driving 15 year old fiestas driving brand new, leased, Golf R’s with the latest ‘phone etc. Brilliant until you lose your job and the house of cards comes tumbling down.
From individuals to Countries. Most live well beyond their means.
It’s not going to change any time soon. If ever.
Nobody gives a damn about debt anymore. If they can service the monthlies, they don’t care,
Idiots who should be driving 15 year old fiestas driving brand new, leased, Golf R’s with the latest ‘phone etc. Brilliant until you lose your job and the house of cards comes tumbling down.
From individuals to Countries. Most live well beyond their means.
It’s not going to change any time soon. If ever.
mickythefish said:
Tax income is near enough 1 trillion.
I think the issue is trying to grow the economy out of debt, just doesn't work.
I can't be the only one to see civil pensions, all the different political bs, remove second homes, move to more virtual events become proper streamlined. You can keep saying we are richest in world whilst living in increasing debt.
Key priority should be getting debt free in 10 years. I think debt is hiding massive inefficiencies in the system.
People used to moan when the government overspent 30 billion over the whole year lol.
Countries can grow out of debt it is a decent plan.I think the issue is trying to grow the economy out of debt, just doesn't work.
I can't be the only one to see civil pensions, all the different political bs, remove second homes, move to more virtual events become proper streamlined. You can keep saying we are richest in world whilst living in increasing debt.
Key priority should be getting debt free in 10 years. I think debt is hiding massive inefficiencies in the system.
People used to moan when the government overspent 30 billion over the whole year lol.
But not us.
Too much red tape and protests against a blade of grass thst might get runover.
Exporting power (electricity) is our last roll of the dice and would be possible but requires infrastructure. And everyone objects to windfarms, solar panels, nuclear plants...
The UK is at two milestones in UK history.
Highest tax burden AND highest debt.
If a political party says it can do tax cutbacks, the reality is debt will be used to fund it .
The only solutions I can see, if the UK will start to sell off assets to cash rich countries like China, Saudi, Africa etc.
Even if government wanted to reduce debt it would need 100 billion plus another 100 billion to pay off. That would take 30 odd years at the least.
The UK government doesn't have 200 billion extra. Growing the economy by 200 billion is near impossible, reducing costs is impossible, increasing taxes by 200 billion would probably destroy UK economy.
Yet what is a viable solution?
Highest tax burden AND highest debt.
If a political party says it can do tax cutbacks, the reality is debt will be used to fund it .
The only solutions I can see, if the UK will start to sell off assets to cash rich countries like China, Saudi, Africa etc.
Even if government wanted to reduce debt it would need 100 billion plus another 100 billion to pay off. That would take 30 odd years at the least.
The UK government doesn't have 200 billion extra. Growing the economy by 200 billion is near impossible, reducing costs is impossible, increasing taxes by 200 billion would probably destroy UK economy.
Yet what is a viable solution?
Edited by mickythefish on Wednesday 24th January 12:21
One way to rasie revenue might be to tempt more into work. From what I understand (blame Google if I'm wrong), some 9 million people of working age are not working or actively looking for work (so not 'unemployed' in the statistical context).
Of course it's complicated as I'm sure a proportion of those will argue they are worse off working than they are not. But surely getting more people into work,and collecting taxes from them, raises revenue and allows more spending or debt paydown.
A huge can of worms, I accept. But raising the tax burden on a smaller workforce will just push more people into the 'not worth working' box, won't it?
I think most people don;t begrudge paying tax as long as they feel it's being fairly collected and well spent - something that seems to have been lost on Government somwhere along the way.
Of course it's complicated as I'm sure a proportion of those will argue they are worse off working than they are not. But surely getting more people into work,and collecting taxes from them, raises revenue and allows more spending or debt paydown.
A huge can of worms, I accept. But raising the tax burden on a smaller workforce will just push more people into the 'not worth working' box, won't it?
I think most people don;t begrudge paying tax as long as they feel it's being fairly collected and well spent - something that seems to have been lost on Government somwhere along the way.
loftylad said:
It’s the same from the very top to the absolute bottom.
Nobody gives a damn about debt anymore. If they can service the monthlies, they don’t care,
Idiots who should be driving 15 year old fiestas driving brand new, leased, Golf R’s with the latest ‘phone etc. Brilliant until you lose your job and the house of cards comes tumbling down.
From individuals to Countries. Most live well beyond their means.
It’s not going to change any time soon. If ever.
And why should it? If they can 'service the monthlies' how are they living beyond their means?Nobody gives a damn about debt anymore. If they can service the monthlies, they don’t care,
Idiots who should be driving 15 year old fiestas driving brand new, leased, Golf R’s with the latest ‘phone etc. Brilliant until you lose your job and the house of cards comes tumbling down.
From individuals to Countries. Most live well beyond their means.
It’s not going to change any time soon. If ever.
I lived like that for years. Ridiculous debt funded expenditure. Brilliant. And never missed a ha'penny in repayments.
When I couldn't be bothered with the monthlies any more I simply sold off stuff inc. assets and paid back the debt. Pretty simple and harmless really.
pocketspring said:
Who are we in debt to and borrowing the money from?
IVA? Send the bailiffs in? Or is it all just digital cash, numbers on computers and doesn't actually exist?
Is a joke, right?IVA? Send the bailiffs in? Or is it all just digital cash, numbers on computers and doesn't actually exist?
A vast portion is held in pension funds. So its owed to the UK population. Something like 20-25% (IIRC) is held by offshore, the rest by Financial Firms (Pension Funds, Asset Managers, Banks) and Bank of England as collateral for QE.
The absolute number is probably not that important, its debt to GDP ratio that is important. UK debt to GDP is a bit below 100%. The following countries all have significantly higher debt to GDP ratios:
Canada
France
Spain
Portugal
Brazil
Italy
USA
Japan
Germany is the only G7 nation with a lower debt to GDP ratio than the UK. The US is also a bit of aa quirk, a vast proportion is held by the states themselves - so its actual ratio is really a lot lower. We should really have a similar policy here, rather than letting clown club at the local councils make investment punts no one sane would make, they are forced to buy gilts and earn 5%.
The number might sound big and scary, but viewed globally the UK has a much healthier relationship with debt than what the shouty lot want people to think. We also have very, very high personal saving rates here - particularly since Covid. The oft trotted our feckless, debt addled narrative - isn't really supported by actual data. There is a definite skew in it, but we are very big savers here (and the economy is still growing with little saving rundown unlike the US).
Inflation and economic expansion are how to deal with the debt pile. the UK economy is expanding (albeit the rate of expansion has taken dents). The UK economy is $400bn larger than it was in 2016 - so you can throw things like Brexit at it, and it still grows (albeit slower than its pre-Brexit potential). Viewed to peer, we are not in a bad place - although we run super high risks of political immolation here. We need to get rid of the budget deficit as they are compounding - cutting interest rates is key to that (so inflation fight).
Debt itself isn't a bad thing - as previous poster has described ours isn't actually that high, despite what we kept on getting fed by the scaremongers.
Much bigger worry is what it is being spent on.
Investments to increase productivity= good.
Bailouts of banks, Covid, endless independent inquiries, more money for inefficient NHS= bad.
Borrowing to fund the ludicrous public sector pensions = extra bad as retired people are rarely productive
Spending waaaay too much on the latter, nowhere near enough on former. And where we do try to invest we do it spectacularily badly, eg HS2
Much bigger worry is what it is being spent on.
Investments to increase productivity= good.
Bailouts of banks, Covid, endless independent inquiries, more money for inefficient NHS= bad.
Borrowing to fund the ludicrous public sector pensions = extra bad as retired people are rarely productive
Spending waaaay too much on the latter, nowhere near enough on former. And where we do try to invest we do it spectacularily badly, eg HS2
The thing as I mentioned , is very pertinent , interest payments. Is 120 billion a year on interest payments, "not really that high."? 5 years ago was about 10 billion FYI.
I actually think debt v GDP is very out dated nowadays. It gives no indication of how a country is likely to manage its debt burden.
Anyway the government just added another 600 million to UK debt.
https://www.bbc.co.uk/news/uk-politics-68083108.am...
Remember the big short, where a whole industry got it wrong, welcome to part two, but this time no government to bail out a government.
I actually think debt v GDP is very out dated nowadays. It gives no indication of how a country is likely to manage its debt burden.
Anyway the government just added another 600 million to UK debt.
https://www.bbc.co.uk/news/uk-politics-68083108.am...
Remember the big short, where a whole industry got it wrong, welcome to part two, but this time no government to bail out a government.
mickythefish said:
The UK is at two milestones in UK history.
Highest tax burden AND highest debt.
If a political party says it can do tax cutbacks, the reality is debt will be used to fund it .
The only solutions I can see, if the UK will start to sell off assets to cash rich countries like China, Saudi, Africa etc.
Even if government wanted to reduce debt it would need 100 billion plus another 100 billion to pay off. That would take 30 odd years at the least.
The UK government doesn't have 200 billion extra. Growing the economy by 200 billion is near impossible, reducing costs is impossible, increasing taxes by 200 billion would probably destroy UK economy.
Yet what is a viable solution?
Do we have any left to sell ? We have already sold off most of them.Highest tax burden AND highest debt.
If a political party says it can do tax cutbacks, the reality is debt will be used to fund it .
The only solutions I can see, if the UK will start to sell off assets to cash rich countries like China, Saudi, Africa etc.
Even if government wanted to reduce debt it would need 100 billion plus another 100 billion to pay off. That would take 30 odd years at the least.
The UK government doesn't have 200 billion extra. Growing the economy by 200 billion is near impossible, reducing costs is impossible, increasing taxes by 200 billion would probably destroy UK economy.
Yet what is a viable solution?
Edited by mickythefish on Wednesday 24th January 12:21
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