Ministers might well, of course, seek to highlight the significant increase in the apparent interest cost arising during the course of the year. However, whilst it is true that the costing question rose, that is offset because the cost of financing future pension obligations fell very dramatically because of the increase in interest rates, which therefore meant that a much smaller provision is required for such costs, meaning that in overall terms the government actually had, in a proper accounting sense, net financial income rising during the course of the year of in excess of £140 billion.
….
The critical figure to look at is net public sector pension liabilities as shown under non-current liabilities, and as is clear, this potential cost fell from£2,639 billion to £1,415 billion during the year, or a decline of £1,224 billion – or almost half the UK’s annual income.What is more, the total UK government deficit fell from £3,875 billion to £2,389 billion or by £1,486 billion (or, near enough £1.5 trillion) in total, or well over half the UK’s total annual income for this year. And I stress that this happened in a single year, and all because interest rates rose so much that future pension costs are now considered to be vastly more affordable.
The good news is that the UK is now, near enough, £1.5 trillion better off than it thought. That money should, as a result, now be available to be spent on making sure that those pensioners for whom the provision is being made might have a country in which it is possible to live in their old age.
This is from the man who insists that discounting future cashflows is a very naughty idea. Yet, when changes in the discount rate favour his ideas he shrieks that there’s another £1.5 trillion that can be spent.
But then who expects logical consistency from a potato?
Does this take into account that a lot of central government pensions are unfunded? I can see how local government schemes might have reduced future liabilities but does he assume the government can claw back excess or future contributions? See the miners for how well that works when they bitch about the insurance deal they got.
This is the same fellow who a couple of week ago (or likely earlier today) was complaining about high interest rates meaning that there was a higher deficit which upset his spending plans?
Well, I guess both higher and lower interest rates means he has fodder for another column. Which is the point after all.
So we have net future liabilities of £2.4 trillion that are unfounded rather than £3.9 trillion? Even if I trusted the actuarial and finance calculations in the stats, We are still indebting our grandchildren to a massive degree. Until that figure actually turns ‘positive’ (I.e we can find future liabilities) then there is no great cause for celebration. Clearly however austerity is working so we arguably need more of it. Let’s start with all income going to ‘Funding the future’ and all the other sock puppets .
“We are still indebting our grandchildren to a massive degree.”
Our grandchildren will be living abroad; it’s the invaders’ grandchildren who will find it necessary to default.
Dearieme
I’d hope that is the case but if you look at the state which Starmer’s vision most resembles, North Korea, their citizens struggle to escape.
I think the goal of The Great Replacement as well is that those being replaced are killed off, not moved away – whether as part of slavery reparations or some other scheme to punish ‘White privilege’ the entire Civil Service are working 24 /7 behind the scenes on.
He seems to think that because the deficit has dropped that it means more can be spent. It doesn’t. It would just raise the deficit. Only if the deficit turned into a surplus could that surplus then be spent.
But then who expects logical consistency from a potato?
I do. I would expect a potato to remain a starchy nightshade tuber, in the same way I would expect an adult human with XX chromosomes to be a woman, and an adult human with XY chromosomes to be a man, no matter how they behave or choose to present themselves.
Murphy’s mistake is to forget that money means jack shit because goods and services are provided in real time by humans. As the population ages the demand for goods and services from the unproductive rises versus the supply available from the productive. And what does that tell us, children?
“I also have to advise that I will be retiring as Professor of Accounting Practice at Sheffield University Management School at the end of February.”
The grifting stratagems are about to go into overdrive!
Jumped or pushed?
VP says
the entire Civil Service are working 24 /7 behind the scenes on.
You what? The entire civil service are working?
At 24/7? Some of them may be “working” about 6/4 but 24/7 is against the rules.
Guido today reported as follows:
I wonder whether the ASI or a similar august body could organise a head-to-head debate between this chap and Captain Potato – always assuming we’re dealing with two seperate people, of course – to discuss “The Political Economy of the UK 2025”.
Perhaps Reform would sponsor the event as it would be a sure-fire membership boost.
Philip
Fair point you make of course but the civil service’s ideological hatred for White people and their wish to kill them all remains permanent. The entire public sector is a hotbed of incessant racism against Whites!!!
Potato wouldn’t agree. He doesn’t debate with neoliberals, see?
He doesn’t debate with people smarter than he is. And that’s almost everyone alive (and not a few dead people).