So what is the reason for the obsession with the remaining £36bn or so cost? It can’t be because it is excessive in proportion to the sums owing in our recent past, because it clearly is not. What is also very obvious is that the cost of our national debt is running at exceptionally low levels. We paid a lot more interest as a proportion of GDP in past decades when the debt to GDP ratio was much lower. If you want evidence that the paranoia about the national debt is misplaced right now then this is that.
And as and when interest rates rise again that interest burden is going to grow, isn’t it? Given that no government (copyright R. Murphy) ever does pay off the national debt.
Say the gilts yield returned to 5%. That’s not out of historical experience at all. At which point the interest bill is rivaling the NHS as the biggest single expense.