It's all relative.
The bald figure might be the highest number yet seen but in 'real terms' and as a proportion of GDP or net public spending UK government borrowing
is not particularly high.
When the tory party left office (as usual) the UK was saddled with a record level of debt (by
any % measure as well as numeric figure) which
was also accelerating at a record rate; the chancellor (Gordon Brown) referred to this in the budget.
In real terms British borrowing was approx £90billions when the tory party left office.
So you can see that although the numbers sound high the economy is producing and 'worth' so much more that a straight numeric comparison is not
really possible with 9yrs ago or further back and a 'real terms' figure must be used.
The entire UK government budget this year will be approx £500billions.
The borrowing for the year will be around the £38billion mark forecast (bear in mind that although June might have been 'worse' than expected some
months have been 'better' too).
Many forecasters believe Brown is sqeezing therate of increase in public spending now so that the projected deficit reduces by much more than
forecast.
Then come general election time (and as our new PM) he will be able to present himself in the best light possible.
We shall see.
Net debt is now 47 per cent of national income in France, 47 per cent in America, in Germany 62 per cent, in Japan 83 per cent and in Italy over
100 per cent -- but this year in Britain 36.4 per cent.
I can report that in future years debt will be 37.5, 38.1, 38.3, 38.4, and 38.4 per cent of national income. So we meet our second rule over the cycle
and in every year and we do so by a margin of £26 billion.
Net borrowing - which was £90 billion just over a decade ago - will be £37 billions this year, £36 next year, then 30, falling to 25, 24 and 23
billions in 2010-11 as we borrow to invest, borrowing in that year 1.5 per cent of national income compared to 8 per cent just over a decade
ago.
