Debt Mountain


Public Sector Net Debt now stands at £1.3 Trillion.

That means the government has borrowd £1.3 Trillion from the taxpayers. Over £20,500 is now owed to every single citizen in the UK. If we include the liabilities for unfunded public sector pension schemes that debt actually stands at an eye-watering £1.7 trillion. No funds are saved to meet the expected pension payments when they become due. The bill is simply left for future taxpayers to pay.

Politicians must urgently confront the enormous debt mountain that has built up thanks to overly-generous but completely unfunded public sector pensions. Failure to give taxpayers a better deal will leave our children and grandchildren with a frightening bill to pay for today’s public sector staff.

The Government’s estimate of the size of this shortfall is also not calculated in the same way as the private sector must calculate its liabilities. Both the Government and the private sector reduce the expected payments in future years by a discount rate, to account for the fact that money held now to pay for a commitment in the future should grow.

But these discount rates are not the same. Instead of using the market discount rates, the Government uses a more generous rate determined by a committee. We need the government to wake up and deal with the size of their debt instead of waiting for future generations to pick up the bill.

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A windfall coming to George Osborne in the next budget due to lower-than-expected inflation and the declining cost of borrowing. This is welcome news to a Chancellor who has staked his credibility on eliminating the deficit but not so much for the economy.
New spending promises continue to be made by the government and the longer-term forecasts for the levels of public spending continue to creep ever upwards at every financial statement.
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Free school meals requires a subsidy from parents on lower income through tax. Providing these meals to every infant school child, regardless of income, only means that money will be diverted from other parts of the budget.
A while ago we wrote about about why the TaxPayers' Alliance are worried about the current state of government debt and why you should be as well. More than one person pointed out that we can inflate away or use quantitative easing to magic (at least part of) the debt away. So here's a post about why we can't rely on those options.
It's wrong that a week in the sun comes with such a huge tax bill, as the taxman chases holidaymakers all the way to the departure gate. These taxes are not only too high but hit those on lower incomes the hardest, making it more difficult for hard-working people to get away for a well-deserved break during the summer holidays.
Our Campaign Director, Andy Silvester, was on BBC news on Saturday speaking out against the End Austerity Now march, reminding others that the £1.5 trillion National Debt is something that we should be worrying about.
We are already paying nearly £50 billion a year in debt interest payments, just on the £1.5 trillion “official” debt. That’s more than we spend on education – as a sign of how broken our public finances are, the fact that we’re paying more as a result of past mistakes than we’re spending on the next generation takes some beating.