As the holiday season draws to a close and the political conference season approaches the almost overwhelming consensus amongst the political class and media is that Britain is facing a public finance crisis of staggering proportions. It is certainly the case that public sector net, cumulative, debt is going to rise to levels not seen outside of war-time, with currently the forecast being that it will rise to at least 80% of GDP or double Gordon Brown’s original 40% target.
But it should also be added that by international standards this is not that dramatic – the US governments’ debt will rise further, for example, and other major OECD countries have managed for long periods with debt in the 60% range.
At the moment all the political parties are trying desperately to avoid answering key questions on their policies towards this debt. So here’s three simple questions that should be put to them over and over again until we get some answers:
- What do you think is a reasonable and sustainable level of public debt? Forty percent? Fifty percent? Sixty percent?
- How quickly do you think we should reach this level – one parliament? Two? Three?
- How is this going to be achieved – how much can be realised by through cuts in spending and how much through raising taxes? For cuts, what will be cut? For taxes, what will be raised?
Unless we start to get some answers to these simple questions we are headed, as I’ve said before, towards one of the least transparent elections of modern times.