Excuse Me Again But Britain's Public Debt Doubled Again Overnight to Now £4 TRILLION

Wednesday, July 14, 2010

And you still count?
It was only yesterday that Britain's societies of accountants and economists disturbed 5 o'clock tea, saying that - according to their calculations - the Empire's public net debts of £2 Trillion were more than double the official figure.
This was a bad guess. It is £4 Trillion or again double that overnight, at least to this story in the Independent:
The true scale of Britain's national indebtedness was laid bare by the Office for National Statistics (ONS) yesterday: almost £4 trillion, or £4,000bn, about four times higher than previously acknowledged.
It quantifies the burden that will be placed on future generations, and it is the ONS's first attempt to draw together the "off-balance-sheet" liabilities that have been accumulated by the state. The figures imply a huge "intergenerational transfer" - broadly in favour of today's "baby boomer" generation at the expense of younger people and future generations.
The debt primarily consists of the cost of public sector and state pensions, and of payments promised to private contractors under private finance initiatives. It far exceeds any of the figures so far published for the national debt, the largest current estimate for which is £903bn...
It appears Dagong's "AA-" rating is closer to the reality than the "AAA" given by Western rating agencies, who have so far only cautioned a downgrade in the distant future for the UK.
But it still escapes my understanding how 3 major bodies can differ so widely on the key figure of these times: total government debt.
We have seen it before earlier this year, when debt figures of Greece and Ireland multiplied within a few days/hours, leading to massive loss of confidence in the troubled Euro.
This is understandable. Can we trust official figures anymore when they exponentially mushroom overnight?
I have searched the reported figures on the ONS website with a blank result for the staggering £4 Trillion number, this being the latest on public net debt. Note the steeper curve due to bank rescues, though.
The Independent exclusively has these details and a sobering perspective for future generations:
If the current generation of taxpayers wanted to remove the higher bills facing their children and grandchildren, they would now be paying around 30 per cent more in tax.
The ONS data strengthens the Government's hand in its attempt to pull down state spending.
The ONS itemised the public sector's main liabilities as:
  • Future payments for the state old age pension: £1.1 to £1.4 Trillion
  • Unfunded public sector pensions for teachers, NHS staff and civil servants: £770 billion to £1.2 Trillion
  • Payments under private finance initiative contracts: £200 billion
  • Contingent liabilities (eg bank deposit guarantees): £500 billion
  • Nuclear power plant decommissioning: £45 billion
  • Impact of financial sector interventions: £1to £1.5 Trillion
Given the wide estimates, would you be surprised if another Trillion gets tacked on?
If you still count find the exact figure of global debts from 2009, that figure still stands unchanged and unchallenged.


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