The Treasury and most commentators are mesmerized by UK state debt at 95.5% of GDP, the official figure which appears in the ONS monthly updates. They are right that by the standards of the last fifty years this is a high figure and reflects substantial increases in borrowing by government particularly over the banking crash and great recession in 2007-10 and again over covid between 2020 and today.Ā So far this has not proved unaffordable as interest rates have remained very low and markets have been willing to lend.
By international standards the UK level of debt is middle of the pack. Japan leads the high debt league with around 250% of GDP, all financed at around zero interest and with inflation still low. Different rules seem to apply to the Japanese economy.Ā In Europe Greece at 190%, Italy at 150% and Portugal at 127% are much higher . France is at 122% and Spain at 118%. The USA is also above the UK.
The ONS accepts that there are various ways of calculating the amount of UK debt. Indeed, it thinks a fairer or more realistic way is to take its figure for “Public sector net financial liabilities” rather than the figure for “Net Public Sector debt” given the complications created by the balance sheet of the Bank of England, a body 100% owned by the state. What should we make of the state debt owned by the Bank itself? How should we account for the Term Funding schemes the Bank runs?
On the ONS definition of net liabilities the figure runs out at 82.9% of GPD in July 2022, 12.6% of GDP lower than the usually quoted figure.
Of course the state should seek value for money in what it spends, should aim to control public spending well and should look to the private sector to invest and finance most activities outside the core services of health, law, order and defence, and schools. It would be good to see state assets rising and net liabilities falling. The state needs to control the cash cost of interest charges by avoiding excessive borrowing. It is also important not to overstate the gloom about our debt levels and to understand the range of numbers official statisticians come up with to try and capture the complexity.
August 25, 2022
Good Morning,
As Sir J. points out, the nominal amount of debt outstanding is somewhat academic, you can view it many ways and different countries have their own funding models.
The important point is the COST of the debt. Here’s a sobering snippet to contemplate, and see disturbing parralels to today:
The 1979 Conservative government
The incoming administration of Margaret Thatcher raised interest rates to 17 per cent, as the government of the time saw this as a critical weapon in combating inflation, which was steadily rising at the time. It did have the effect of reducing inflation, although critics noted its negative impact on UK manufacturing exports. Interest rates began to rise again towards the end of the 1980s, partly under the pressure of house price rises. Interest rates had gone from 17% in 1979 down to 9% in 1982, and were back to 14.88% in October 1989.
Could we afford such rates today? History to repeat?
August 25, 2022
It is not quite the same at the Thatcher period. Inflation can you cured by ditching net zero, fracking, halving the size of the state, reversing Sunak’s vast manifesto ratting tax grabs, his money printing and by vast deregulation… no need for 17% interest rates this time though.
“Of course the state should seek value for money in what it spends” well we could try that for a change but currently government still doing large net harm wasting vast sums of money – vaccinating children with largely ineffective and often dangerous Covid Vaccines, HS2, pushing the insane net zero expensive energy lunacy, blocking the roads, subsidising unreliable energy and impractical/expensive and environmentally damaging electric cars, over regulating everything… many of these thing produce negative value let alone any value for money.
August 26, 2022
Value for money! Donāt make me laugh. Not a shred from this waster pseudo socialist party and govt. they are redundant and broke of peopleās trust. Not only have they not sought to implement the manifesto on which they were elected it is clear from the shameful wasted 12 year record they acted in stark contrast. Using every trick of deceit and deflection just to gain power. What has the country got to show? All self inflicted messes of their creation. Will Cameron, May or Johnson worry about cost of living or energy prices they inflicted on the nation? No.
Wrecked economy, third world public services despite 70 year highest taxation, lowest disposable income, highest debt, highest deficit- over Ā£20 billion in debt interest in June alone! Remain in EU orbit to the extent the UK cannot deport illegal criminals, instead wishing to put them up in four star hotels (they shut down detention centres it helps illegals disappear) while tens of millions are sick with worry to pay for cost of living!
Lives 457 died and hundreds more with life changing injuries and tens of billions wasted in Afghanistan for over a decade to see this party and govt run away! Truss gave the terrorists Ā£100 million of our taxes as our military ran away! But masses of Afghanistan people welcome here in UK. Minister Wallace admits the same and then wants more in Ukraine!
Do these bunch of shysters have any decency, direction or patriotism? Do they have any firm policies that anyone would believe or trust?
Reform Party appears to be the only option left. At least they put out a sensible energy policy, immigration policy, Brexit policy.
August 25, 2022
Compared to other nations we are OK?
August 25, 2022
Of course we’re OK. We have our own currency and it’s only the naysayers and EU fanatics that wish us ill.
We still shouldn’t be wasting money on socialist policies and until the channel invasion is curtailed and energy supply fixed, we will continue to deteriorate.
We need a conservative government but there’s probably no prospect of that.
August 25, 2022
Not OK when that currency is low to various others. The NHS is NOT an ‘investment’.
August 25, 2022
a bit like our murder rate is OK compared to USA?
August 25, 2022
A bunch of people jump out of a plane with no parachutes. They fall at slightly varying rates, smiling at each other as one floats up and others down realative to each other. They all hit the ground at roughly the same time.
August 25, 2022
depends totally on use of clothing and arms/legs to defeat simple gravity.
What do you mean by roughly?
August 25, 2022
Take your pick as to the definition of public debt and then invent a figure for political purposes. This is what the morally bankrupt Tories do and this is what destructive Labour will do if they get back into power.
Both parties when in government will pick whatever definition is debt is appropriate to justify further debt issuance. The Tories use debt to finance their appeasement of the leftist client State. Labour will use debt to finance a new and brutal authoritarian State as we are now seeing in the US. Both parties use debt to finance the political status quo that keeps them ensconced
The argument on this issue has become bereft of absolute truth and devoid of any degree of relevance until of course the detritus hits the fan, which can’t come soon enough
August 25, 2022
The bus drivers have been awarded an 11.1% pay increase locally after withdrawing their labour someone told me they’ll also get back pay for the month they took off work, they drive around our area in empty double-deckers all day long with 1 or 2 passengers on them, probably on free bus passes. Peak times 5 passengers when picking up the next bus from the Main town where everyone has to go miles out of their way to get to one of the most significant work estates (well, it used to be before covid now it’s nearly empty). Any private sector business would just run cars/ 7 seater people carriers around not buses.
When staff keep reading the public sector strikers are getting such high rises, they want the same, even if their wages rose in March. I’m sure the unions will be delighted until our prices rise so high no one can afford to buy British goods abroad and people start to lose those well-paying jobs and bus services get removed altogether.
Workers across the skill range insist on differentials. The debt is going to seem as though it’s going down because everything else is going to go up and up and up. If you increase the bottom nlw by 6.5%, then what did they expect?
August 25, 2022
Sums it up rather well
August 25, 2022
This bout of inflation is a failure of the government to provide energy security whilst backing the USA’s interference in Ukraine. Putin (nasty though he is) was goaded into invading Ukraine and did so deliberately whilst we were on our knees after the pandemic, having printed money like confetti.
By 2024 the fall in our living standards is going to be dramatic and permanent.
It is my fervent belief that the more conservative members of the RMT and Aslef (and there are many of them) would not have supported strike nor would have abstained were it not for four things:
– The Ā£3bn of profit the leasing companies were allowed to make during the Covid crisis etc
– The failure to recognise that rail workers had accepted (without complaint) pay freezes for nearly three years and the failure to acknowledge that they worked from the outset (often in taxis – the worst infection rates) when Covid was thought to be the Black Death.
– The RPI increases in rail fares despite in spite of those pay freezes
– The failure to recognise that rail staff HAVE taken on new working practices, technologies and DO work extremely flexibly (booking on and off literally any time of day or night) and are exposed to extreme short notice rostering changes (3 hours off booked times either way. A shocker if booked to start at 7am to be moved to 4am. Work well into a rest day or be travelling to work on a rest day to start at 00.30 am)
The lies told about walking times etc have caused offence.
Schapps lost the conservative element of the workforce (which would have prevented strike) and now the bug is catching.
August 25, 2022
37/6: Iām not keen on the UKās total immersion and involvement with the Ukraine, I donāt see why we should offer disproportionate aid, warfare and manpower. Boris and now Truss and Sunak have said they will continue, Labour offered no resistance and would have done the same because for some reason the UK seems to be called on as protector not just to nato countries but to all. Putin is killing innocent women and children, he has the technology and weaponry to take out only strategic targets but chose instead to inflict pain on innocents, sorry but I canāt condone that.
– Living standards falling, conforming with Net Zero, people not being able to run their cars, all going to plan isnāt it. The only protected workers heading towards retirement right now are public sector workers pensions, no pension pot caps for them, railworkers included and they donāt even appreciate how much that payroll benefit is worth.
– I worked throughout covid not a day off, as did all my colleagues. As did most of my family and friends not at home, safe, but out and about mixing with others, as did all the Supermarket staff. The trains were running virtually empty. Are you saying that from March 20th to July 2020 they were running every train, fully staffed on every route as normal?
– sorry I donāt understand what leasing companies were allowed to make Ā£3bn profit during lockdown? Who paid for that if a small fraction of people were using the railways?
– What do you mean by pay freezes? Are you claiming they didnāt have 1p increase in their hourly rate for three years because I donāt believe it? Especially the lowest paid for a start they would have had their pay differentials against the NLW increased. How much more turnover was taken from Rail fares in 2020 and 2021 than was taken in 2019? Not %s, in folding money.
– Do railworkers not get enhanced pay for evenings, nights, weekends? I read some get a choice of whether to work weekends or not is this true or not? What causes the short notice roster changes sickness levels and short notice because of that? Do the workers get full sick pay or not? If they do then surely they understand about having to provide cover for a generous sickness pay scheme? I understand transport. I understand about shifts. Sounds like lots of poor planning if rail workers are having to travel on rest days, why would that happen because it isnāt then a rest day if it cuts into the 24 hours off period according to the WTD?
– Not a Shapps fan but donāt know enough about your other complaints. I was talking about buses but thank you for the time you took to reply to me and giving me some more details.
August 26, 2022
you talk about short notice changes example stated 4 am rather than 7am. But in reality how often does this happen, and where can I catch a train at 4am?
August 25, 2022
We borrow money in order to give it away. Much of this is wasted and is inexplicable. Maybe the government could TRY to explain it!
I doubt anyone objects to helping other countries with emergencies and defence against tyrants, but why does the UK always have to be the BIGGEST contributer? Is it our politicians (one in particular) seeking more glory, or is it that other wealthy countries restrict their help? The Ukraine is in Europe. The EU keeps bragging it is 27 versus our 1. Why is the UK providing more help than the much vaunted 27?
August 25, 2022
Good Morning Shirley. I suspect that it is to maintain the moral high ground but I don’t think you have to climb so high to achieve that with the EU.
August 25, 2022
I dare say we are doing it for the āspecial allianceāā¦..you knowā¦ with the country that exacted war debts from us until they were finally paid in 2006.
The US has (I have read) strange ideas about drawing Ukraine into the great ādemocraticāš³ network as a bulwark against Russia.
Familiar technique involving boots on the ground, much expenditure ( good for arms makers and banks) and much death ( good for depopulation).
August 25, 2022
Nail on head. Plus a self aggrandising PM who thinks he’s Churchill.
August 25, 2022
+1
Agree 100%..that too!
August 25, 2022
Churchill? I seem to remember that Churchill controlled our borders. Boris doesn’t come close. We have everything to thank Churchill for and not much for Boris.
August 25, 2022
Well the 27 are big on ducking pain unless it is inflicting it on those that argue with them.
Avoiding conflict with the threatening Russia is the policy, as if they will ‘go easy’ on the breakaway states.
August 25, 2022
You’re big on the Russian ‘threat’, Mickey. What’s Russia actually done to threaten this country, please?
August 26, 2022
Well Bill, did you conveniently miss this?
A Russian state television agency has openly threatened to wipe the United Kingdom off the map with nuclear weapons, likely in response to a manufactured threat made up by another arm of the Kremlinās media empire. The news segment depicted the use of a single Sarmat superheavy intercontinental ballistic missile (ICBM) or Poseidon nuclear torpedo to destroy the U.K. The entire segment was apparently based on a threat that the U.K. never actually made. Russian Channel Oneās popular anchor Dmitry Kiselyov manufactured the threat on his popular Sunday evening television news program. Kiselyov, known as āRussiaās Spin Doctor,ā is a popular news personality who in 2014 boasted his country could turn the U.S. into ānuclear ash.ā In 2019, Kiselyov listed a number of targets in the continental United States that would be hit in the event of a nuclear war.
This week, Kiselyov turned his attention to the United Kingdom. Kiselyov stated that President Vladimir Putin has put Russian nuclear forces on āhigh combat alert,ā and then turned his attention to allegations that U.K. Prime Minister Boris Johnson could conduct āretaliatory strikes,ā presumably on Russia. Kiselyov then stated that the U.K. could be destroyed with a Sarmat ICBM or Poseidon torpedo.
It is not all sweetness and light in our relations with Russia after their invasion of Ukraine and threats to the Baltic States.
August 25, 2022
Great post Shirley
August 25, 2022
Most of the 27 are skint and reliant on handouts. That’s the ‘glory’ of the EU. Plus of course most of them are noted cowards and seek appeasement – we’ve seen that in the past have we not, and had to save them with no thanks, just insults.
August 25, 2022
and it coerces the small fry to buy goods/food/energy etc from the big boys in the little club.
August 25, 2022
The Ukraine is not eally about the Ukraine-it’s about control of the Black Sea trade-it’s where historically the steppe trade routes from China and Central Asia meet European middlemen-(for instance where the ancient Greeks dealt with the Scythians,the Venetians and Genoese with the Mongols of the Golden Horde in the late middle ages(prior to that the Byzantines had preserved the Black Sea as their exclusive lake),etc and,after Catherine the Great had annexed the lands of the Crimean Khanate -and put a stop to their slave raiding and trading-the introduction of agriculturalists and the start of the Black Sea grain trade.
Interesting figures on “proportion of all UK flagged vessels travelling through straits between Jan 2019 and Jan 2020”
to/from UK ports
Malacca 6%/3%
Mandep 4%/3%
Hormuz 19%25%
Bosphorus 29%/25%
Oresund 1%/1%
I don’t know what those Bosphorus cargoes are or which ports they set out from but it’s a high(and vulnerable) figure.
August 25, 2022
Its caviar for all the Russians & Albanians living in London
August 25, 2022
Good morning.
The thing about the National Debt is, it is created by people who will not have to pay it back and therefore are removed from any sense of responsibility and accountability.
I wounder if people really understood that each and everyone of us, plus all those yet to be born are responsible for this, that they would allow such a scandal to continue ?
I mean, would you be prepared to pay off a complete strangers debts for the rest of you life ?
August 25, 2022
Paying for strangers is exactly what governments force through hugely high taxes people to do. Sorry (after tax) you cannot afford another child or heating as you have to pay for this pregnant mother with seven children already or these migrantās hotels and legal aid!
JR says āOf course the state should seek value for money in what it spends, should aim to control public spending well and should look to the private sector to invest and finance most activities outside the core services of health, law, order and defence, and schools.ā The government should largely get out of education and health care.
The government are very poor indeed at delivering almost anything certainly their rigged market virtual monopolies in education and healthcare and their insane energy policy. Fairly useless at defence and law and order too.
August 25, 2022
Would you consider your mortgage lender a complete stranger? It is a matter of context, is it not? Is the ‘National Debt’ more like a mortgage or a personal loan?
August 25, 2022
We have no choice we are hugely over taxed under threat of imprisonment to fund others.
Allister Heath surely right as usual today:- Brexit is on the brink ā and the ultra Remainers are mobilising to cancel it
Truss is the Brexiteersā last hope. If she canāt deliver on the benefits of Leave, we may end up rejoining.
August 25, 2022
I think he is correct. its 6 years since the vote and 1 1/2 years since more or less hard brexit was implemented. We’ve had 3 years of a leading Brexiteer as PM, with Brexiteers in all the key cabinet roles. the Conservatives have had an 80 seat majority. But to date we have seen very little of the benefits of brexit, whilst we have undoubtedly seen some downsides, albeit not what was predicted by project fear. Now we will have Liz Truss who is backed by such staunch Brexit supporters as Sir John.
So it will be reasonable for voters to conclude that if by the time of the next election we still haven’t seen the advantages claimed for Brexit – new more extensive trade deals, de-regulation, escape from some of the worst EU policies, freeports etc – then perhaps Brexit was a nice idea in principle but the realities of the world make it impossible in practice. A Starmer govt, whilst it wouldn’t immediately re-join, would sign up to all sorts of EU policies, inc a sort of shadow membership of the single market, would cave in immediately on any dispute, and may even start sending them money again. So I think Heath is right – its last chance saloon for Brexit. It will be interesting to see what happens.
August 25, 2022
‘Weāve had 3 years of a leading Brexiteer as PM’ – – my god you were easily conned to believe that!
Nothing to do with personal status seeking then?
August 25, 2022
Richard1, weāre only beginning to stop paying the Brexit divorce bill to the Eu later this year. It reduces right down next year. The first few years were messing around with the -hold everything up squad- of conservative MPs who ran on a manifesto offering to enact a Referendum then failed to do so and thwarted the democratic decision even though the Euro MEP elections reinforced the wishes by elected a massive majority of Brexit MEPs. Remember Soubry, Hammond, Sandbach just for starters.
The UK couldnāt act on independent trade agreements until after the withdrawal period, it hasnāt been six years at all! This only happened after the end of 2019 when Boris took over. It is underway. Jobs have come back to the UK, manufacturing and production plants are re-opening, especially in the Midlands, wages were recovering steadily (until the energy crisis and the war has pushed up inflation). BAE is recruiting 1000 engineers, JCB, Rolls Royce the same, lots of good news out there if you look for it. The Germans must be hurting due to their stance over trade as most people i know changed car purchases to Tesla, Kia, Toyota, Hyundai and other Japanese brands such as Lexus and other white goods because of all the talk of us not getting parts for repairs. The French government are going a good way to upsetting their UK customers and visitors. Goods exports to many countries have risen, Switzerland by 53% in the 12 months to June 2022 to the previous year.
There are lots of things that could be done to help the UK over Ireland, we import 200,000 tonnes of Irish beef, Irish cheese, not a quibble we are good friends to Ireland, yet they quibble over us sending goods to our own Country with paperwork showing its final destination in Northern Ireland. If inter-Ireland border fraud takes place then this could be identified, goods are invoiced? Loads are most often digitally tracked now in the 40 ft vans.
Albania is joining the EU, no need for dinghies then they can freely move around the whole of the EU soon. Why we are turning a blind eye to criminality, picking people up and not taking them to an offshore boat whilst their paperwork and entitlements are processed I donāt understand, it should all be funded from our foreign aid budget and dealt with quickly and efficiently. If people get the right to stay then benefits must stop they then have to work. I actually donāt have a problem with migration of workers who canāt claim benefits, or housing benefits. I would make the length of time for any benefit claims 16 years then workers canāt come and undercut the working conditions of people and step over British people waiting patiently on lists, I know of the breakdown of several relationships because the only way to get a social home is to be a single parent and often the State provides more money than the Dad ever could.
August 25, 2022
It stands at Ā£32,000 per head apparently.
Is that from birth do you suppose?
Per every two feet out of a dinghy?
August 25, 2022
MarkB I don’t know about people who will not have to pay it back. Inheritance tax has risen to around Ā£7.2bn per year. They’ll get their pound of flesh eventually. The elderly have to cash in homes to pay for their own care. Unless they’re the sort of person who never bought a housing asset, lived off the state all their life and then go on pension credit and end up in the room next door for free.
August 26, 2022
Iām afraid itās worse than you think. Since the closure of council run homes the government has forced private homes to accept ācouncil customers ā. Of course they only pay some 50% of the going rate. How do the homes make up the shortfall?You guessed it, we pay extra to make up the difference.
My wife and I are working class and have worked hard for EVERYTHING we have. I am sick of our government dishing out more and more to evermore people for free!
August 25, 2022
Why quibble on these figures? Reinhart and Rogoff showed conclusively that once national debt exceeds 80% of GDP the future growth of that contry is compromised and problems would arise.
That’s what we are seeing…. worldwide…
August 25, 2022
@ PeteB – Reinhart and Rogoff said 90 per cent. rather than 80 per cent. and their paper contained errors material enough to mean their findings are now viewed as anything but conclusive. Other than that, you could hardly have summed them up better.
August 25, 2022
What’s 10% between friends! If yuou added the unfunded state pension liabilities into UK Government debt we’d be sky-high.
I’d still hold high government debt is a drag on future growth. Stats clearly demonstrate that happens.
August 25, 2022
@ PeteB – The statistics did not do that for the Amherst trio who critiqued R&R’s paper. Rather Herndon, Ash, and Pollin said that differences in average GDP growth in the categories of debt levels at 30-60 per cent., 60-90 per cent., and 90-120 per cent. cannot be statistically distinguished.
August 25, 2022
There is another key difference between national debt – and that is the ability to repay it. Countries with surplus are in a much better place than those with a deficit in balance of trade. My memory may be playing tricks but I’m pretty sure that the balance of trade was viewed much more seriously when I ‘were a lad’. Of course, we probably had surpluses back then, so it was not something to shy away from. These days our political classes much prefer to just focus our attention on GDP
August 25, 2022
I remember the time well and our massive trade deficit today is another example of gov incompetence and neglect.
Back then figures were regularly reported and we were told that when there was deficit it was reduced because of oveseas investments and the dividends produced.
There has of course been a complete turnaround. We are now told that selling off everything here is the best thing. Clearly other countries who buy us up as fast as they can with help from our leaders prefer to invest for the profits they can send back to themselves. Our leaders ought to be locked up for their deceits trickery and gross neglect.
August 25, 2022
@PeteB
It seems that Reinhart and Rogoff didn’t proove anything “conclusively”. In economics, I suppose that would be unusual.
Also, I’m not sure why you suggest that debt specifically in excess of 80% of GDP, would compromise the future growth of a country. The amount compromised growth would depend on a the % debt/gdp figure. So … I believe our host is right to highlight the difference between 82.9% and 95.5%.
https://en.wikipedia.org/wiki/Growth_in_a_Time_of_Debt
August 25, 2022
“This week, economists have been astonished to find that a famous academic paper often used to make the case for austerity cuts contains major errors. Another surprise is that the mistakes, by two eminent Harvard professors, were spotted by a student doing his homework.” source BBC https://www.bbc.co.uk/news/magazine-22223190.
August 25, 2022
Not worldwide-Russia has been running a sound money economy for a long time.I think they are still running a small budget surplus ytd.It’s the west that’s bust-irredeemably and irreversibly.What we need is a war!
August 25, 2022
Their figure was 90%. But as so often happens such general conclusions get disproven by new data. Japan gets away with 250% (albeit probably 125% net). It must depend on interest rates but also on the tax base. An economy which is already maxed out for tax take (like the U.K., France – in fact all western EU countries) must have less incremental debt capacity than countries like Switzerland, Singapore, Japan, US which have a lower tax/gdp ratio and which could in principle therefore raise taxes further if they needed to.
There must also be a massive difference for a country whose taxpayers own 100% of the debt held as part of QE, like the U.K. and US. As opposed eg to France whose QE debt is held by an outside body (the ecb), of which they are part owners, but taxpayers of other countries own most.
August 25, 2022
Does the larger figure still show a slavish attachment to Maastricht rules?
Why does the BoE like to ādouble countā in this way?
Is it possible to restructure this debt as a long term āwar debtā as with remortgaging the Home? If it is, might it be useful to include the expenditure incurred in supporting Ukraine?
August 25, 2022
Indeed the good news is there is so much fat and misdirected expenditure in the state sector that could usefully and easily be cut (were we to have a PM with a will to do so). Much of what the state sector does is actually a net negative and/or produces no value at all. Start with a huge bonfire of red tape, the soft loans for worthless degrees ~ 75% of them surely are, net zero, renewable subsidies, the rigging of markets in energy, education, transport, healthcare, housingā¦ HS2, the war on motorists and road blocking, the war on landlords and thus tenants, the hugely wasteful, very inefficient and incompetent NHS, test and trace, the vaccinations that for many age groups have done serious net harmā¦
Boris Johnson:- the British public to endure higher energy bills as the price of freedom in Europe because āUkrainians are paying in bloodā. Well no Boris we are suffering absurdly high energy prices mainly due to the climate change act, net zero, you listening to green crap pushing Carrie, Ed Miliband, Theresa May, Kwasi, the blowing up of coal fired power stations, the rigging of the energy market, the fracking, drilling, nuclear & mining bans. This and the circa 95% of virtue signalling, scientifically illiterate, MPs who voted for the climate change act (with no costing) and Mayās moronic Net Zero lunacy.
August 25, 2022
Don’t worry folks. Our massive debt levels are lower in percentage terms than other countries so we are doing very well.
Our currency is collapsing, we buy billions more than we sell. We are not allowed to protect or use our own assets to keep ourselves heated, powered and secure.
Foreign ownership and the settlement of our country and what’s here gives the City spivs and their friends in politics nice profits and the means to retire overseas on.
August 25, 2022
You need innovation to pay the debt back. Self employed people need to be as free as possible from tax because only they will start companies to create jobs or move freely between companies transferring skills and knowledge.
August 25, 2022
Yes – The Conservative Way….well in the old days
August 25, 2022
So lefty English graduate Emilie Maitlis accuses BBC of harbouring āactive agent of the Tory partyā. Well if so he is having zero effect looking at the appalling, misguided, left wing, woke, unscientific/climate alarmist drivel and misguided propaganda the BBC push every single day. The Tory part itself is essentially 90% socialist anyway Emilie!
August 25, 2022
I found a āNational Debt Clockāonline.
āOurā debt ( did we vote for all these expenditures?) is growing at the rate ofā¦
Ā£5,170 per second š
According to the clock.
Tick, tock.
August 25, 2022
But with circa 10% inflation devaluing in real terms at about the same Ā£5K per second! Unless the clock is already allowing for inflation.
August 25, 2022
Off topic, for once he is telling the truth:
https://liveblog.digitalimages.sky/lc-images-sky/lcimg-8c49488c-aa34-42f9-b324-8a1926f26724.png
“BORIS: WE MUST ENDURE FUEL BILL PAIN TO DEFEAT PUTIN”
“Cost-of-living crisis is Britain’s sacrifice as Ukrainians are ‘paying in their blood'”
Assuming we are determined to defeat Putin, for whatever reason and at whatever cost.
My wife was livid when that front page came up on her phone, and she will not be alone.
August 25, 2022
That’s it then. To economic destruction. Rather like Zero Covid at ALL costs.
(Putin can hang on in there for decades to deny Boris his aim.)
August 25, 2022
Denis Cooper.
My opinion, for whatever it is worth, is that Boris has always seen himself as a benevolent dictator.
Covid gave him the means to become such over the U.K.
Then he thought with carbon neutral he could progress to the whole world.
Mad? Well perhaps a bit, yes.
And getting worse.
No point in being livid. He has been deposed.
August 25, 2022
perhaps it is someone closer to home that might be mad?
August 26, 2022
He has been deposed, but the war he helped to foment continues with no end in sight.
Maybe some of the Russophobes in the EU/NATO/US troika anticipated that for external supporters of the Kyev regime this would be a low cost proxy war, but it is not turning out like that for the UK. If the government freezes energy prices at an average cost of Ā£3000 for 28 million households that would be Ā£84 billion for a start, and that is before the help needed by businesses. UK GDP is around Ā£2200 billion, so it could be 5% of GDP added to the government’s debt.
August 25, 2022
We could always try paying Putin for gas in rubles.
Then we might not freeze.
But then again Net Zero might be even harder to justify were there no āwarā.
Just like house arrest would have been harder to justify had there been no āplagueā.
August 25, 2022
Would debt be so bad if we actually had a health service, defence, law and order and schools?
The higher the debt the worse our ācoreā services become.
Where can the money be going?
August 25, 2022
Well, Sir John, you’re going to have to bring in some more tax. May I suggest that when the EU introduces its ETIAS tax on British tourists entering the EU, from late 2023, the UK retaliates by introducing an arrivals tax on Schengen nationals, with the aim of recouping the exact same amount. And please, no protests about how difficult this would be to implement.
August 25, 2022
Recouping what from who? Individuals will pay ETIAS, just as we pay for ESTA for the USA and ETA for Canada (as examples). The UK government pays nothing.
And, as it seems you aren’t aware, the Conservatives have been planning on doing this since 2019.
August 25, 2022
āThe Pulseā reported in June that there was no longer any requirement to wear a mask in GP surgeries.
This advice has wobbled slightly since but it seems generally that there is no official requirement.
So why do the GP surgeries keep saying that it is obligatory?
This government IS for turningā¦.frequently.
August 25, 2022
Sunak now claiming he was against taking SAGE advice to lockdown schools etc all along. Absolute bilge. He can’t on the one hand try to claim credit for spending mind blowing sums of money on paying teachers and others for doing nothing and also say he wanted them at work. He’d have resigned or not done the support package if he was that bothered.
August 25, 2022
Indeed. Lack of furlough would have hardened attitudes to lockdown.
I worked throughout, particularly scary in the early stages when we thought it was the Black Death.
August 25, 2022
He’s a slippery fellow
August 25, 2022
I strongly suspect that amongst the general public, the figures which are of more concern are:
1. 1300 criminal migrants entering the UK in one day – given a “free” ferry ride by the Border Farce to the land of “free” everything ….. with a predicted 60,000 by the end of the year
2. Domestic energy bills predicted to rise to over Ā£6,500 a year
If the CON Party doesn’t take drastic action to deal with both of these, they’ll be facing a 1997 style meltdown in 2 years time.
August 25, 2022
+1
Frankly I think they’ve had it. Things will be a lot worse by 2024.
August 25, 2022
even more concern: – – The same Tories might get re-elected.
August 26, 2022
The trouble is that the only viable alternatives areā¦ā¦ā¦ā¦ā¦ā¦.. Socialists!
The tories have hit on a way to be voted for in perpetuity. Stand one step to the right of Labour.
August 25, 2022
The UK is unlkely to default on its debt as it can print its own currency.
The UK can afford the interest payable on debt to itself.
What the UK populous can not afford is in the inflationary theft of the value of our wages, or the high taxes that again steal our wages.
I am much less interested in total debt than what our government chooses to spend money on. I want government to stop being interventionist, it can not solve every problem and the population needs to be weaned off the teat. Why is it assumed that the government will help people pay the electricity and gas bills? That surely is not a government’s role. Yet the question is what will be done and how much not IF.
August 25, 2022
House prices prevent me from purchasing a house – when people can’t afford to pay their mortgages because they are paying for other things, house prices will adjust.
Constant intervention keeps all prices high (and let’s not discuss childcare and Sign language interpreting which are both markets propped up by taxpayer cash like housing).
August 26, 2022
Totally agree. When I am made PM my very first law will be that NOBODY gets paid for doing nothing! Our country is a disgusting mess, there are crops rotting for the want of picking. There are a reported 1.5 million job vacancies. I donāt understand our country.
August 25, 2022
Well if these debt figures are as accurate as the inflation figures the real debt is about 180% of GDP.
Lies, damn lies and government statistics.
August 25, 2022
Whatever, it’s far, far higher than when Labour were last in, and yet you and your press were all screeching that it was utterly unaffordable and unsustainable back then, weren’t you?
August 25, 2022
+1
August 25, 2022
Yes, it is, but Labour has never had to shut the Country down for months on end, and if it was up to your lot, people would not have gone back to work or school after Christmas this year, they’d have not ended test and trace and not tried to get back to a more normal life.
August 25, 2022
Yet you have been screeching for more public spending on everything, on here, for years NHL
August 26, 2022
Martin you have been very quiet lately, concentrating on curtain twitching?
We hope all is well, your oft amusing hysterical rants gives us at least a smile in the morning.
August 25, 2022
Sunak backtracking on Sage.
What next ?
An MP admitting being unvaxed.
August 25, 2022
For goodness sake, don’t give any succour to the borrow and waste government that the debts they are racking up aren’t so bad.
August 25, 2022
Sunak now criticises the Government he played a major part in.
Rishi Sunak has criticised the government’s response to Covid – suggesting independent scientific advisers were given too much authority. Mr Sunak – chancellor in the pandemic – told the Spectator magazine there had not been enough discussion about the negative side-effects of lockdowns. He said he had felt “emotional” when he argued to keep schools in England open. Downing Street said the economy and education had been “central” considerations in decision-making.
In his interview, Mr Sunak also hit out at campaign posters showing Covid patients on ventilators, saying it “wrong” to “scare people”.During the campaign, both candidates have sought to highlight areas where they disagreed with the government in which they served, with Ms Truss saying she was opposed to the rise to National Insurance.
As chancellor from February 2020 to July 2022, Mr Sunak played a key role in the government’s response to coronavirus, including establishing the furlough scheme and the Eat Out to Help Out scheme.
Speaking to the Spectator, Mr Sunak insisted he did not want to blame individuals but said he believes a series of mistakes were made by ministers during the pandemic.
He said ministers were not given enough information to scrutinise analysis produced by the Scientific Advisory Group for Emergencies (Sage) – a group of independent experts advising the government.
“We shouldn’t have empowered the scientists in the way we did,” he is quoted as saying.
Mr Sunak says ministers should have talked more about what he described as the “trade-offs” of lockdowns, such as NHS backlogs and the impact on children’s education.
Such a poor Government response but he stayed on !
August 25, 2022
ONS must be a happy little place to work.
Calculating levels of debt and excess deathā¦
A kind of government fingerprint/ footprint service?
August 25, 2022
Just because other countries are more in debt does not mean that we should follow their example. Sanity is something that you can enjoy by yourself. Always remember that the interest paid on State debt is as good as money flushed down the toilet. And the annual cost of this interest is rising.
August 25, 2022
and what goes down the toilet finds its way to our seashore!
August 25, 2022
Tom Harris in the Telegraph today:- āDevolution has unleashed a vile tsunami of anti-English hatredā
Thanks to the disaster that was the appalling Tony Blair/Gordon Brown era for the botched devolution. All rather predictable and indeed predicted. Why do the Welsh and Scottish continue to vote for such appalling policies and leaders.
August 25, 2022
The element of (independence) blackmail gets the devolved assemblies more money, which they use to bribe the voters with all sorts of freebies, none of them available in England. The electorate know independence cannot be forced upon them without a referendum, so have no problem supporting the Nats in order to get the extra funding and freebies. Government needs to stop appeasing them with a bigger and bigger share of UK money in a vain attempt to buy off the Nats.
August 25, 2022
And no politians in England and few others are prepared to defend and promote England in any meaningful way. They just pretend to but it is deceit as it is always below other subjects. They are too cowardly and limp-wristed to do anything worthwhile.
August 25, 2022
But there’s no mention of the truly massive unfunded liabilities of the Pensions payable to those in Public Service. These pensions are paid from current taxation.
Their terms are from a bygone age when “old” meant 65-70. No commercial enterprise can afford to fund such Final Salary schemes and they have long since disappeared. Did I read somewhere that the liabilities amount to something of the order of Ā£2.3 Trillion and growing?
August 25, 2022
The debt (whatever the figure) would be brought down by exporting energy as we did from the 1970s with the Exchequer. We also need the gas for the interim period, otherwise many businesses will close and people will die from cold (& hunger).
Frack baby frack, it’s all upside!
SMRs for medium/long term.
Extract the digit Kwasi!
August 25, 2022
You need to look at all government owned assets and liabilities. It is more than the national debt.
First the unfunded pensions owed to government employees and state pensioners. Our divorce bill to the EU came as a shock. What similar obligations does the government have with other organisations?
These should be offset by the assets owned by the government.
Visibility, then managing these would make a positive contribution to the national finances.
August 25, 2022
Our debt levels will simply continue to increase if we do not reverse the futile attempt to net zero our 1% contribution to global CO2 emissions using expensive, low energy density and intermittent renewables. Our nuclear plants are being closed down with just the one replacement being built to a design experiencing multiple technical issues and may not even be working by the electricity decarbonisation date of 2035.
As I write wind is providing only 3.33 GW (10.2% of demand) from an installed capacity of 27GW and unless we revert to cheap, reliable fossil fuels, and start ordering nuclear, such as RR SMRs, we will experience permanent power shortages.
Reliance for our power on renewables will result in more industrial capacity moving to coal-fired China and our balance of payments, debts and unemployment (apart from public sector jobs of course) will increase.
We will have no energy security as 95% of wind turbines and 100% of solar panels are supplied by China. Furthermore, China has control of the supply of the raw materials for batteries as only China has low enough environmental standards for their production.
August 25, 2022
Wasn’t so long ago that we thought Japan nuts with no growth for years etc. Perhaps we ought to find out how they keep inflation low and don’t seem to have the same problems we do. Maybe conventional thinking on economics is wrong, after all it is more religion than science it seems to me.
August 25, 2022
No population growth so no need to purchase and pay for additional infrastructure just repair and replace at planned intervals.
We have too many takers and too few contributors (however much the government takes).
August 25, 2022
Grham1946.
Many years ago, (I was born 1944), you may remember, it was said that the Japanese were willing to work hard, long hours, for low wages.
August 25, 2022
as did the postwar Germans.
August 25, 2022
They offshored their production. As fast as their government prints money to create inflation, the Japanese squirrel it away in savings. To spend lots of money requires space which they don’t have.
August 25, 2022
If I ran my household budget the way government runs the UK Iād be rightly criticised.
I see France, Canada, and the UK have simultaneously told their citizens that the good times are over with the end of an easy abundance of goods and resources. France is working on an “energy restraint plan” that would ask all citizens to commit to a “hunt for waste”, such as turning off lights when leaving offices, Mr Macron said.
Letās start our own hunt for waste. Wait, we already have a head start with the list compiled by the Taxpayer Alliance. Letās dust that off and instead of imposing restrictions on the people cut down on Government waste. Make a start by turning around the migrant boats. You will have to do it eventually so do it now. Stop giving asylum to Albanians, which other EU countries stopped years ago, this will remove one of the pull factors. Stop wasting money on Foreign Aid. Have a bonfire of unnecessary charities which use taxpayer money to pay their executives inflated salaries. Cap or remove the green energy tariffs and VAT which are raking in massive amounts of money they donāt deserve. The list is endless for tackling the waste governments themselves have created.
Our Government is like a rabbit caught in the headlights unable to take action on problems they themselves created.
August 25, 2022
Contingent liabilities and future interest rates are the ultimate killers and no amount of creative accounting both on and off the Balance sheet to mask over the problem by complicating its calculation further will solve it.
As many have noted the ballooning Public Sector pensions future liability alone is over Ā£2 trillion and needs controlling independently and made public especially when Civil servants are going on strike for even more benefits compared to the private sector.
August 25, 2022
Going to watch Survivors (BBC 70s ) again. It’s got everything for bored conspiracy loons.
Virus from the East, hospital vaccination queues, mass die offs, private security yobs, supermarket lootings, a smattering of smallpox, London dictator etc. etc. I think it ended with Scotland, The Isle of Wight and Engineers being the salvation of UK. It was a bit too middle class and undiverse but that was the 70s.
August 25, 2022
Rishi Sunak is saying that scientists with their āunexplained modellingā should never have been put in charge of the Governmentās response to the Covid pandemic and that it had been a mistake to ’empower’ the Government’s scientific committee, Sage, into making the decisions resulting in doom-laden forecasts which drove Britain into a series of damaging lockdowns.
He said ministers had been wrong to use ‘scare’ tactics to force people into compliance, arguing it made it harder for the economy to recover.
We are seeing precisely the same tactics used by the climate change activists.
CAGW was initiated by a communist fifth column using āunexplainedā (viz rigged) climate modelling and scare tactics of climate breakdown/a burning World to empower our Western Governments to destroy our cheap and secure fossil energy supplies in order to bring economic ruin.
The resulting Net Zero Strategy is now even being exploited by wealthy, capitalist elites who see the possibilities of total control bringing enormous profits for themselves.
August 25, 2022
It was the government that decided to believe Neil Ferguson and his mathematical model of Covid19. The government are a bunch of ignorant Arts graduates so they always like a go-to ‘techie’ to give them scientific advice. Unfortunately, not all ‘models’ or techies are any good at predicting future reality so its always best to
get a wide range of opinions. Unfortunately, if you are an Arts graduate you would have no basis on which to judge the merits or demerits of alternative hypotheses. The UK is also about the worst governed country in the Western world: this is a co-incidence.
August 25, 2022
Is the EU in breach of either or both the NI protocol and the Belfast Agreement by insisting on Intra-U.K. tariffs on steel between GB and NI?
August 25, 2022
ONS, OBR, NS&I, British Business Bank, Department of Finance (NI), The Economic and Social Research Council (ESRC), Office of Manpower Economics, Office of Tax Simplification, Payment Systems Regulator, Salix Finance Ltd, Wales Audit Office, Government Finance Function, Government Tax Profession, the list goes onā¦..
We seem to have a lot of conflicting government quangos doing the job of the Treasury – no wonder we’re in a mess
August 25, 2022
glen. I’d prefer to see the 2030 ban totally ditched.
Along with the whole carbon neutral madness.
If private enterprise wants to produce EV’s let it.
Why stop IC vehicle production?
Yes and ditch all those quangos as well.
August 25, 2022
Fully Agree Pauline….as I believe the majority do
August 26, 2022
Sinecures for lots of well-connected friends and public school friends of chums.
August 26, 2022
See also directly or indirectly taxpayer-funded think tanks,NGOs and charities.
August 25, 2022
āā The government will provide over half the cost of a Ā£20m plan to upgrade the UKās EV infrastructure that will see just 1,000 charge points installed across the country ahead of the 2030 ban on new petrol and diesel car sales.āā Net-Zero-Watch
I see the policy of net-zero is still running full steam aheadā¦Iād prefer the money spent on extra police
August 25, 2022
Boris the green insane fanatic is happy to ruin us to protect his plan. He’s still banning us from producing our own gas. How many people will he kill while he enjoys a good laugh?
August 25, 2022
We got rid of Boris due to his insane net-zero policiesā¦however I fear those policies are due to stay under the leadership of Sunsk or Lizz
August 25, 2022
Completely off topic
According to news reports circulating Boris Johnson is preparing to sacrifice the poor and elderly of this country in his support of Ukraine.
Is that acceptable behaviour?
August 25, 2022
Hasnāt anyone told Boris that net-zero, inflation and the cost of living crisis started before the Russia invasion of the Ukraineā¦.weād still be in this mess without the Ukraine war
August 25, 2022
So the reason we arenāt fracking for shale gas is because Russia invaded the Ukraine
August 25, 2022
It will reduce the pensions bill, and was it really an accident/mistake/ignorance that sent covid sufferers into old folks homes? The combination of low pensions and high fuel and food costs should see off a few more with pneumonia and undernourishment, and I doubt the NHS will care. Priority must be given to wokery and diversity.
If I sound bitter .. I am. I admit it. The NHS has lost my trust, along with the government and most of our politicians.
August 26, 2022
Shirley you sum up the mood of the people very well ‘If I sound bitter .. I am. I admit it. The NHS has lost my trust, along with the government and most of our politicians.’
August 25, 2022
Thanks Sir John for that clarification. It is good to know other economies are in a worse state than ours.
Though actually that was not what worried me!
I am worried by the present inflation. Even more worried about the recession you have forecast (and I believe you).
Hopefully, Liz Truss is on the right lines to deal with that.
Even more worrying is the Energy Supply for next Winter.
One of Boris’s craziest ideas.
Are we going to ‘Keep the lights on’ as you have put it?
More to the point, keep ourselves warm and industry running?
August 25, 2022
I see your soon to be ex leader has scooted off to Ukraine again at the tax payers expense.
You’d think there isn’t much of any interest going on in the UK at the moment.
Citibank projecting 18-20% inflation by the new year.
People in real fear of gong cold and hungry this winter.
No, not much to concern the current Prime minister of the UK. Ideal opportunity for a tax payers jaunt to Ukraine.
Can’t say I’m sorry to see the back of Mr Johnson. An utter waste of a very decent majority and our time and money.
August 25, 2022
O/T
Good old BBC highlighting the problem with heating oil and a family on Universal Credit’s with an empty oil tank. No mention that suppliers are setting up standing orders to enable people to keep their head above water.
Trouble is people have forgotten or never been taught how to prioritise the essential monthly outgoings. They sit in hope a charity will arrive to fill their tanks.
Just like our government seems to do on a daily basis only its the taxpayer who is the charity.
August 25, 2022
How about the debt that will be required to at all those public sector final salary pensions which rise every year by the rate of inflation ? Is that included in the figures you quote ? How much is it ?
August 25, 2022
The Home Secretary paid millions to the French law enforcement to curtail illegal immigration and now weāre going to pay Albanian law enforcement millionsā¦.all a waste off time and money while weāre signatories to the Council of Europe ECHR
August 25, 2022
BBC reporting that only 21 people removed from UK in new asylum rules….with 63,089 asylum applications in the past 12mths