Wednesday, 22 December 2010

More scary UK fiscal numbers

These days, I get very nervous when the public sector statistics are about to be published. I keep hoping to see some limited progress towards reducing our mammoth fiscal deficit. Unfortunately, the numbers continue to disappoint.

The data for November were particularly bad. In one single month, the government ran up a deficit of £23.3 billion. To give that number some context, the government collected £36.7 billion. So, for every one pound raised in taxes, the government borrowed sixty-three pence.

That is a fearful rate of debt accumulation. Since April this year, the government has piled on an additional £100 billion in new debt.

So far, the UK haa avoided the sticky fate of Ireland and Greece. This is in large part due to the post-election budget that has, for the moment at least, convinced financial markets that they should continue funding the government's gargantuan borrowing requirement.

However, the commitment to deficit reduction has to manifest itself in the fiscal numbers. We need to see a lower monthly deficits as soon as possible.


dearieme said...

The numbers should be published every month in a document to be called The Brown Book.

Anonymous said...

Yet there are people specifically in the Guardian but elsewhere too who call austerity risky for the economy, bizarre, this can't go on.
We are doomed, for all the talk of Tory cuts, they barely scratched the surface.

dearieme, I agree with that.
But I would also like to see something called the Brown Tax.
This should be levied on all people who were eligible to vote during the squander years. ie the young would not face this tax. (seems only fair since they are paying for their education now that was once free).
The Brown tax would be however much is needed to pay for our debt interest and structural deficit.
As the debt and deficit came down, so would this tax.

I think thats the only responsible way.
It used to be the debate was about tax and spend, but now governments borrow and spend, and the generation that did most of the borrowing don't pay most of the cost.
This has to be changed.