I just had a quick look at UK public sector indebtedness. Late last year, there was a 7 percent of GDP surge public sector debt. The data does not say why, but I am almost certain that the increased debt is due to Northern Rock. The data only goes up to August, so we haven't yet seen the impact of the Bradford and Bingley on Government balance sheet. Banking crises don't come cheap.Here are two more interesting facts on public sector debt. First, since January 2003, public sector indebtedness has increased by 12.5 percent of GDP. Second, during that same period, the nominal value of the debt has risen by ₤296 billion.
Big government is definitely back here in the UK.
3 comments:
I suppose that if you added on all the other liabilities - pension promises and so on - and subtracted all public assets, we'd still be left with a huge debt?
I'd prefer you explain why NR caused a £10bn jump in NET debt... because I don't see those sums adding up.
A jump in gross debt, I'd understand, but the NR shenanigans should have been accounted as lending not as spending.
Something significant happened, however. I'm not sure what.
"the NR shenanigans should have been accounted as lending not as spending."
Perhaps they've accepted that the difference between the two is simply the time it takes to slip from the former to the latter as the defaults roll in.
Nick
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