The Chancellor is repeatedly asked why, if the
economy
is recovering, it is necessary to pursue a
programme of
continued austerity? The Coalition says that it has
reduced the
deficit by a third, but this is only part of the
picture. It refers to the difference between annual income
and expenditure, which is currently
some £90bn.
George Osborne should remind the electorate that
the
Budget deficit is the
not the same as total national
debt, which at around 80% of GDP is
the higest of
any major economy. However, when all liabilities,
including state and public sector pensions are taken
into account the real national debt is
closer to
£4.8 trillion, some
four times greater than GDP. With
annual debt interest running in excess of £45bn -
equal to the entire
Defence budget - the case for
continuing with the
Chancellor's tight fiscal policy is
compelling.
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