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UK Public Sector Borrowing and Expenditure

Some statistics to inform the debate on cuts.

(Statistics from the Office of National Statistics, except where stated.)

Debt and borrowing

Government borrowing in August 2010: £15.9billion
Forecast government borrowing for the fiscal year 2010/2011: £149billion
Official national debt at August 2010: £823.8billion
Official national debt at August 2009: £667.7billion
National debt including public sector pension liabilities, Railtrack liabilities and PFI liabilities at August 2010: £2,088.3billion

Expenditure (central government only - i.e. excluding local government) (Fiscal year 2010)

State pensions: £117.2billion
NHS: £119.5billion
Education: £29.9billion
Defence: £43.8billion
Social welfare: £60.4billion
Law & order + fire service: £17.0billion
Transport: £12.1billion
General government: £13.9billion
Other: £48.5billion
Interest on national debt: £30.9billion

Total: £495.7billion

National debt over time:

As a percentage of GDP:

(This graph from the Office of National Statistics does a good job of showing how much of the increase in the debt as a percentage of GDP was due to the bank intervention and how much (i.e. most of it) was due to generally increased expenditure.)

Since 1692, as a percentage of GDP (from ukpublicspending.co.uk):

Since 1900 in actual amounts (from ukpublicspending.co.uk):

National debt as a percentage of GDP compared to other countries (statistics from International Monetary Fund):

(So although it's bad in the UK (and getting worse quicker than in most countries), we're not alone. Be thankful we're not Japanese...)



( 22 comments — Leave a comment )
Oct. 20th, 2010 07:48 am (UTC)
I love the random Sumos in that last one!

What I'd quite like to see to get my head round this is a graph showing monthly income v. expenditure over (say) last five years, total, and as broken down into sectors...

I only have a small brain and have problems carrying data in head from one graph to the next, particularly when distracted by flying Sumos. :-D

Oct. 20th, 2010 05:16 pm (UTC)
"a graph showing monthly income v. expenditure over (say) last five years, total..."

Something like this (courtesy of The House of Commons Library Research Service)?

'The Economic Recovery and the Budget Deficit'
Oct. 21st, 2010 10:26 am (UTC)
Ouch. The way the revenue line pootles along waaaaaay under the spending line for the entire period is a bit alarming.

I had a look to see if I could find anything that showed the percentage of public spending that is loan servicing/repayment, but I can't find anything.

As a third line on that graph, would it more or less follow the 'spending' one, only lower?
Oct. 20th, 2010 08:41 am (UTC)
I thought that if I procrastinated for long enough, someone else* would make a post like this.

May I point friends towards it?

*By which I mean, "you" ;-)
Oct. 20th, 2010 10:50 am (UTC)
Oct. 20th, 2010 03:14 pm (UTC)
Oct. 20th, 2010 09:47 am (UTC)
I find the 1692-present graph very interesting especially for the site maker's commentary on the debt burden and the likelyhood, or not, of default.

I wonder why none of the papers & news media etc have not made more of this to explain things to people is too close to the truth? Or is he a crackpot theorist?
Oct. 20th, 2010 10:07 am (UTC)
I wondered about that. Surely the 1950's hump was surmounted partially due to the Marshall Plan which is a bit of a non-repeatable wildcard?

Oct. 20th, 2010 10:15 am (UTC)
I dunno did we get Marshall Plan monies?
Oct. 20th, 2010 10:26 am (UTC)
Yes! More than Germany!
Oct. 20th, 2010 11:06 am (UTC)
Don't forget that the Marshall Plan was itself theoretically a loan (although most countries, including the UK, were able to negotiate debt reductions with the US) so that they never paid back the full amount.

A number of economists believe that the Marshall Plan actually hindered economic recovery in post-war Europe since it forestalled the transition from corporatist central planning to a true market-based economy. This is the view of Alan Greenspan today and was the view of the German finance minister for most of the post-war period, Ludwig Erhard.
Oct. 20th, 2010 12:05 pm (UTC)
I can see the argument that the money was largely spent on imperial aspirations that would have had to be let go sooner otherwise.

However, in relation to that graph, does it matter? If not for the Marshall Plan, then the percent GDP borrowed would have been lower, because the credit would not have been available.

Therefore, does the Plan not directly affect the shape of the graph?
Oct. 20th, 2010 04:50 pm (UTC)
Yes it does.
Oct. 20th, 2010 10:55 am (UTC)
I don't know about him being a crackpot theorist, but he certainly has an agenda, which is why I included the graph (taken from official statistics) but not the commentary in this objective post.
Oct. 20th, 2010 11:32 am (UTC)
Ok I can see that, but is there any objective thinking (consesnus amongst other economists) behind the statement that debt servicing by paying interest is doable until it gets to 12% or is that part of the agenda?

Also, while it is obviosuly politically biased given the call to protest at the end is there some truth about the current situation as described here?
Oct. 21st, 2010 07:14 am (UTC)
I would quite like to know which governments HAVE defaulted at 12%. My suspicion would be that there are political and social factors that influence that sort of decision, and the percentage GDP may not be the deciding one. *wears cynical hat*
Oct. 21st, 2010 09:27 am (UTC)
I should do another post that explains different economists' attitudes to large debts. (Although you're obviously right to point out that the blog you link to has its own agenda.)
Oct. 20th, 2010 10:09 am (UTC)
So, wars cost a lot then?

I'm finding it hard to visualise the number of zeroes. It's about 10-15 grand per person in the UK?
Oct. 20th, 2010 11:14 am (UTC)
Yes - that's certainly one of the messages. War is expensive.

I make the national debt £13,405 per man, woman and child using the official classification of the debt (i.e. excluding public sector pension liabilities, PFI and Railtrack), or £34,003 using the full number.
Oct. 20th, 2010 11:33 am (UTC)
Well that's me buggered then
Oct. 20th, 2010 03:07 pm (UTC)
Yep. If there are 65m people in the UK (guesstimate), then the official national debt is £12,673 each, and the total national debt is £32,128 each.

That's for each person, including both my next-door neighbour's nine-month-old daughter, and for my 97-year old great aunt. If you are just looking at people of working age, like you and me, you can roughly double these figures; so that would be £25,300 on the official figure, or £64,300 on the total figure.

And yes, war is expensive - as is being prepared for war (whether you wish for war, or wish for peace). But so are lots of other things.
Oct. 20th, 2010 03:21 pm (UTC)
I think we're turning Japanese.

I really think so.
( 22 comments — Leave a comment )