Public sector borrowing soaring

MyLastFiver

Maybe Dave can get the Argies to invade the Falklands again!

Thrugelmir

Generali wrote: »

I guess from your comment that you've never worked in middle management.

Is there any middle management left in the workplace?

Generali

amcluesent wrote: »

Inflation is now the only option to reduce the real value of the debt.

The trouble is, most of the stuff that is really going to screw things up (pensions, healthcare, PFI and aged care) are index linked costs or (in the case of health and care) costs tend to rise at a higher rate than inflation.

tommy75

40% off inside one year. Bad xmas.

LeeSouthEast

The bottom line is, whichever way you slice this, the country is screwed.

Ho hum.

amcluesent

Doomsday: 30 per cent planned public spending cuts are biggest in history

"Secret plans to slash public spending by up to 30 per cent, with massive cuts affecting public transport, the Armed Forces, schools, hospitals and welfare benefits, are being drawn up by Whitehall mandarins.

The draconian proposals could see spending reduced by a staggering £75billion a year, the biggest cut in British history."

FAO council jobsworths, public-sector numpties, work-shy, gym-slip single mums, benefit-scroungers, 'elf'n'safety drones, Guardian readers, you're going to get a hell a surprise!

Generali

amcluesent wrote: »

The draconian proposals could see spending reduced by a staggering £75billion a year, the biggest cut in British history."

That being about a third of the Government debt being sold this financial year and that doesn't include off the books liabilities.

The UK is in for a very nasty shock at some point. You've lived beyond your means since the mid 1950s. At some point the liabilities will become due.

tomterm8

I wouldn't get excited, amcluesent, any government that tried to do that would be destroyed... their political party would become like the liberal party after World War I... extinct.

mbga9pgf

I wouldn't get excited, amcluesent, any government that tried to do that would be destroyed... their political party would become like the liberal party after World War I... extinct.

And you reckoned a government that raised tax by 75 billion would be viable also? We need to face facts. We are living beyond our means. We have a SIGNIFICANT correction in living standards around the corner. We need to learn how to deal with that I am afraid. Throwing the dummy out of the cot isnt going to reduce the deficit.

tomterm8

I think there are ways to raise taxes by 75 billion without anywhere near the disruption that cutting 75 billion off public spending would cause, certainly. I don't think you can do either without causing massive disruption to the economy, though. The bottom line is I think it would cause a recession deeper than the one we've just been through, and the public finances would probably end up in a worse state than they are now. The best way to cut the deficit is to encourage growth.

But if you must cut spending, taking a longer term approach of freezing wages, extending the pension age to 70, removing programs like ID cards, the aircraft cariers, trident, withdrawing from the wars in afghanistan and iraq, putting a 0.25% tax on all financial transactions and a 20% tax on all dividends and bond interest produced by financial industries (the bailout levy), extablishing a freeze on public sector spending in nominal terms, and encouraging inflation via quantative easing will have much the same effect without such extensive disruption in the short term.