UK debt tops £1 trillion but could double within 12 months!
It has been revealed that the UK government is in debt to the tune of £1 trillion due to increased spending to try and stimulate the economy and reduced tax income. However, over the next 12 months we will likely see the debt in relation to Lloyds Bank and Royal Bank of Scotland added to this total which could increase the debt in the UK by a further £1.5 trillion. This would see the UK in arrears to the tune of £2.5 trillion and the economy potentially still in freefall!
While in many ways Gordon Brown had little choice but to try and refloat the UK economy by investing substantial amounts of money, a number of schemes and transaction seemed to have backfired. The dramatic fall in the banking sector has forced the government to bail out Northern Rock, Bradford & Bingley, Royal Bank of Scotland and Lloyds bank. There is also speculation that more funds will be required in the short to medium term and Lloyds and Royal Bank of Scotland could be taken under total government control.
Until the shares held by the government in Northern Rock, Bradford & Bingley, Royal Bank of Scotland and Lloyds TSB are sold off to investors, their debts will remain part of the public purse.
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