21 May 2009
The International Monetary Fund (IMF) has sent out a warning to vulnerability of Britain to a 'severe shock' possibly destabilising the country as the scale of the public sector debt and the yet to be repaired UK banking system continue.
The harsh overview by the IMF called on the Labour Government to consider urgent and draconian action steps to restrict national debt.
The Treasury needs to adopt to ensure the markets do not lose faith in government debt, The IMF suggested in its annual review of the UK economy the Treasury needed to invoke 'credible and consistent policies'
Also stating 'The sharp increase in public sector borrowing and contingent government liabilities, together with continued financial sector fragility, are significant vulnerabilities.
Worryingly suggesting: 'In these circumstances, a severe shock has the potential to disrupt domestic and external stability.'
It also said National debt is expected to reach a mind boggling £1:4 trillion by 2014, although it has to be said that if the plans in the latest budget were changed and targeted more on the public sector overspend then it is likely the IMF figures could be significantly reduced, sadly there seems little sign of this occurring.
The Institute of Fiscal Studies suggests it could 2034 before public borrowing returns to pre 2007, come on Gordon hasn’t the social engineering gone on long enough.
What all theses reports fail to mention is the fact the Government recovery figures are based on farcical growth expectations which have little to no chance of achievement, thus the British economy could be in for an even rougher ride than these reports expect, after all both the IMF and IFS are always conservative in their overview, but add their's to Standard and Poor’s ratings and the UK does seem in need of radical economic surgery. The problem is the Gordon Brown seems to think its an ideological attack whereas most see it as the logical solution to UK’s sad economic demise.
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