Government borrowing has hit a record high of £163.4bn this year, official figures have shown. The borrowing figure for the 2009-10 financial year is lower than the £166.5bn predicted by Chancellor Alistair Darling in April's Budget. Including financial intervention measures, borrowing totalled £152.8bn - lower than the £155.9bn forecast. It is the biggest annual borrowing figure for a UK government in peacetime. (source BBC)
These are big numbers which are hard to visualise so let me help you out. Total Government debt now stands at £890bn. That is equivalent to £14,600 for every man, woman and child in the UK!
But we are having to borrow an extra £152bn a year just to shore up the nation's finances. That is equivalent to over 11% of the Gross Domestic Product (GDP). GDP is a measure of the nation's overall economic output.
It's a bit like someone owing 65% of their gross income in debt but who has to borrow a further 11% of their income a year just to make ends meet. Now that is scary if not a little suicidal and will only end in tears. To make matters worse if we considered the national debt compared to the working population (the section of society who will carry much of the burden) the figures become even more worrying. The working population is a little over half of the total population of the UK.
So you can see why it is important for the Government to work out how to repay this debt. It's no wonder that it is such a key issue in the run up to the Election. I do not mean to depress people with this post but it's an unfortunate truth. It's no wonder that there are concerns that the UK could soon be downgraded by rating agencies in terms of its creditworthiness.