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Public spending in UK set to suffer

The £50 billion deal which has been announced today will see the deficit for the public purse rise to near £100 billion for the current tax year with a further rise expected next year. This will see UK debt rise to over £600 billion and place severe pressure on public spending for the next decade. Much of the money which has been lent and wasted over the last decade will need to be repaid which will obviously come from either the sale of further state assets, tax rises or a reduction in public spending.

When pushed today the government was very evasive on the subject instead looking to concentrate on its 'ground breaking' moves today. However, with tax levels at near all time highs it seems that the massive public spending program announced by the Labour government will need to be restructured with massive decreases in spending required by the next government, whichever party that may be.

What is now clear is the fact that the UK tax payer will be paying a massive price for government spending over the last decade and more markedly over the last 12 months. We are being promised a return on the investments in Northern Rock, Bradford and Bingley and the new raft of possible banking stakes announced today. But when will it all happen and what will the actual return be?

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