Well, yes, except all of this is actually explained in the report

The National Audit Office published a review of UK debt last week. It was an incredibly important document, and I managed to miss it at first. Its relevance comes down to one key issue. It tells the truth. This is rare on this issue. By this I mean it reports the true level of UK government debt. This is its opening presentation of key facts:

£1.3 trillion in net debt in Whole of Government accounts

This suggestion that the UK government’s debt is £1.3 trillion contrasts dramatically with the Treasury view of debt, which is reflected in this data, issued recently, and which is what the media usually report in their desire to suggest that the UK economy is being crushed by a government debt mountain that is apparently unsustainable and a burden on generations to come

Therefore Spudda is right and we can borrow much more! Because, you know QE debt doesn’t count.

Might be worth giving the next few lines from the same NAO report.

£1.6 trillion 2015-16 public sector net debt
£2.0 trillion 2015-16 WGA net liabilities
£47,000 2015-16 WGA government debt per UK household
£28 billion interest cost of government debt in 2015-16
2.2% implied interest rate on government debt in 2015-16 WGA
£47 billion forecast central government net cash requirement for 2017-18
£80 billion cash needed to repay the principal of gilts falling due in 2017-18

Oh, NAO agrees with the Treasury then? In the footnotes we get the explanation:

The difference in borrowing in the WGA in comparison to public sector net debt is mainly due to the elimination of
debt holdings by various parts of the public sector, most notably the Bank of England through its quantitative easing
programme and the Debt Management Office’s holdings that are used to manage the government’s short-term cash
requirements. The WGA borrowing figure, therefore, represents the debt held by private sector investors, domestically
and internationally.

Or, as we might put it, Treasury owes the BoE the difference. And we’ve been told a number of times that that BoE QE debt is going o be released back into hte markets at some point. The Federal Reserve is already doing it with the American equivalent.

So, Snippa’s distinction between what is owed to BoE and what is owed to the general public doesn’t work then, does it?

12 thoughts on “Well, yes, except all of this is actually explained in the report”

  1. No surprise, really. Yesterday he was stating that all UK govt debt was raised domestically in sterling.

  2. FFS. “…these data…” not “…this data…”

    One only uses the latter when talking to one’s junior rank robot, and in that case you’ll likely be wanting a comma between the two words as well as some capitalisation.

    These things are important if you claim to be a detail man, as academics are wont to do.

  3. And the fact that the 2 lines he shows are converging, as one non-potato commentator pointed out, doesn’t seem to be relevant to Snippa

  4. John D says:
    November 16 2017 at 5:43 pm

    Richard – bravo! I’ve just noticed you have ‘spell-check’ installed
    Reply

    Richard Murphy says:
    November 16 2017 at 6:53 pm

    Have I?

    It’s news to me – it must have come with the latest upgrade, yesterday

    Obviously the comprehensive knowledge of browser add-ons is as great as everything else over there.

  5. Diogenes – as a fat person I can say for certain the problem isn’t in being too fat.
    Its in not paying attention to spelling.

  6. @Rev. Spooner:

    > FFS. “…these data…” not “…this data…”

    In English technical contexts, ‘data’ is best treated as a mass noun, not the plural of ‘datum’. ‘This data’ isn’t incorrect.

    A datum is a reference mark against which an analogue reading is taken. If you happened to have a handful of these, unbolted from some measuring instrument, you’d probably not want to call them data. I suppose you’d have to call them a handful of datums.

    Also, datum is not a good name for a single item of data. As a singular, it suggests it’s a single property, e.g. a single scalar value. A single item of data is often some kind of composite, made up of multiple readings that together relate to some specific state.

  7. It’s not aimed at you though.

    It’s aimed at the stupid left. I hate to generalise, but I have found TWO who seem capable of understanding that while the claim of “Tories (nearly) doubling the debt” is actually true, it’s not unconnected with the £150bn odd deficit left by Brown.

    I usually ask them if they think the deficit should have been reduced more quickly or more slowly and I have yet to get an answer.

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