Public Sector Debt

The UK National Debt continues to grow. Next year, many are now forecasting a public sector net cash requirement of £100bn. This would cause public sector debt to continue its rise.

Public Sector debt is currently £634bn (Northern Rock nationalisation has now been included in official figures). The £37bn worth of Bank shares will definitely have to be included. Although, I doubt the £450bn of bank loan securities and guarantees will be included. This is because at the moment this £450bn is only securities and not actual tax payer money.

Nevertheless, if these securities and guarantees were included as a contingent liability the Government would have a national debt of approaching 100% of GDP. (and that is before we worry about all the pension liabilities which are going to be increasing in the near future.

Although public sector debt of over 100% of GDP sounds bad. I feel the government had no option but to implement a plan like the one it put together.

National Debt and difficulties of calculating

House prices continue to fall. According to London based estate agent Frank Knight, house prices are likely to fall another 15% before levelling off towards the end of 2009.

London is one of the worst hit areas with prices falling more than the national average.