The net borrowing for the 1st quarter 2008/09 for the Public sector equates to £24bn & is the highest since records began some 60 years ago.
Figures released also show that the public sector debt now stands at 38.3% of GDP, another ten year high & worryingly close to the Governments key figure of 40% of GDP.
This could be the reason why a ‘drip rumour’ has been circulating that the treasury is to change the rules.
Some worry that rules changed to suit oneself are in fact the rules of convenience and in fact no rule at all.
The PM & Chancellor seem to be going down the road of record borrowing, oddly one of the very reasons for the present predicament.
Some claim they have the option of raising taxation or altering their own limits on borrowing.
There is a third way, that is to cancel the public sector pension, which is the reason for the last 8 years of local rates increasing well above inflation, and with taxation and a multitude of fines and other government ever increasing income streams reaching record levels the failure to keep pace with the funding of the publics sector pension should give its own answer as the public sector pension is still so far out of control the black hole into which the taxpayer empties their money is inversely proportional to the public sector borrowing.
In other words those who have the greatest to gain refuse to acknowledge that their gain is the problem.
It seems odd those who write the rules i.e. the public sector & those who legislate the politicians demand the private sector accepts the pain whilst they minimise its effect on themselves.
This would never be tolerated in the private sector indeed the Monopolies Commission and numerous other public sector depts would probably demand its demise, but not of course their own.
Many expect the public sector pension to become the biggest problem to the UK economy for the foreseeable future, indeed probably never ending unless it is finally capped.
We now have an NHS that spends up to 70% of its annual income on staff and benefits, whilst the private sector would be in meltdown if this figure went above 20%.
Absenteeism in the public sector is now at such proportions extra staff are hired to offset this, which in theory is madness as the exponential growth i.e. the proportion of absenteeism & its inevitable costs are a vicious circle.
We can only hope the public sector unions do not see this vicious circle as so dangerous to their own existence they demand danger money in any wage negotiations. |
