£520billion
That’s how much UK’s mountain of debt has cost in interest alone in the past 17 years
Britain’s colossal debt mountain has cost taxpayers £520 billion in interest payments alone since the country last balanced the books nearly 20 years ago.
Profligate Chancellors have embarked on a borrowing binge since Britain was last in surplus in 200001 – pushing the national debt up nearly six-fold from £317 billion to £1.8 trillion.
Debt interest payments have totalled £520 billion over that period – or about £21,000 per household – leeching muchneeded resources away from public services.
the Government is due to spend another £41.5 billion servicing the debt this year – nearly as much as it spends on defence and more than the entire transport budget.
the figures pile pressure on Philip Hammond to get a grip on the nation’s finances in what is shaping up to be a crucial Budget for the Government next week.
the Chancellor is struggling to return Britain to the black by the middle of the next decade – leaving Britain facing the longest period of deficits since napoleonic times. He is facing a barrage of demands for extra cash to increase funding for the nHs, give public sector workers a pay rise, ease the burden on students and kick-start housebuilding.
the treasury is thought to have already rejected calls from Communities secretary sajid Javid to sanction a £50 billion housebuilding programme given the parlous state of the public finances.
But on current projections that money will be spent on debt interest payments in about 15 months. Mark Little- wood, of the institute of Economic affairs, said: ‘these figures make for depressing reading and reveal just how ineffective the Government’s attempts to get the public finances under control have been. Ever-accumulating debt is not the way to achieve a healthy economy.
‘ the Government must ensure that fiscal responsibility is strengthened so future generations are not saddled with a mountain of debt.’
John O’Connell, of the taxPayers’ alliance, said: ‘the Government’s addiction to overspending has been out of control for far too long. the scale of the debt is now so great that more than £40 billion will have to be spent on interest payments alone this year.
‘that’s money that could have gone on new hospitals, or scrapping beer duty and inheritance tax. Philip Hammond must ensure that his Budget puts Britain back on the path of sound finances.’
With the national debt spiralling towards £2 trillion, the Government is forecast to spend another £200 billion of taxpayers’ money on interest over the next five years.
But it is feared the debt bill could be even higher as high levels of inflation push up the cost of index-linked bonds and the Bank of England raises interest rates.
Mr Hammond has previously indicated he will aim to balance the books ‘by the middle of the next decade’.
But this means Britain may not run a surplus again until 2025, marking the longest period of consecutive deficits since the country was stuck in the red between 1793 and 1817.
some fear the Chancellor could be preparing to use the Budget to give himself more time by indicating the public finances may not be back in balance before 2027.
Experts at the institute of Economic affairs warned earlier this year that the ‘irresponsibility cannot continue’.
‘Addiction to overspending’
THE Chancellor will announce plans to tax plastic bottles, coffee cups and packaging in next week’s Budget, sources said last night.
Philip Hammond will use his annual statement on the economy to detail plans for a review of new taxes and charges on ‘single-use’ plastic items.
The move is designed to stem the tide of plastic junk poisoning our seas and littering our streets and countryside.
The decision to push for a new tax on throwaway plastic follows the Daily Mail’s long-running campaigns to highlight the menace caused by plastic bags, cups, bottles and microbeads.
Treasury sources last night said it was ‘too early’ to say how any new taxes on plastic would work, or at what level they will be set. Mr Hammond will ask for scientists, manufacturers and retailers to submit evidence to the Treasury in the New Year. Detailed proposals are likely to take several months to draw up.
But sources said there was a determination in Government to act on an issue that has been highlighted most recently by the BBC’s hit show, Blue Planet II.
‘This is building on what we have already done on plastic bags and microbeads,’ a source said. ‘Shows like Blue Planet have highlighted the need to take this issue seriously and act on it.’
The Treasury drive will affect a wide range of throwaway plastics, including coffee cups, polystyrene packaging, bubble wrap, plastic cutlery and even drink-
‘Suffocating our seas’
ing straws. It will cover materials that can be easily recycled, such as milk bottles, and those which cannot, such as disposable coffee cups.
The Environment Department is already considering whether to introduce a deposit scheme for plastic bottles to discourage people from throwing them away.
But Treasury sources say Mr Hammond will also consider whether new taxes are needed to combat the problem.
In the UK alone, the amount of singleuse plastic thrown away each year would fill the Albert Hall a thousand times over. An estimated 12 million tonnes of plastic waste is dumped in the oceans each year, creating ‘floating continents’ of junk. One in the Pacific is the size of France.
Environmentalists last night welcomed the move, but urged the Chancellor to act swiftly and decisively.
Mike Barrett, director of science and policy at WWF, said: ‘Plastic is suffocating our seas. There is no greater example of the havoc we have on the natural world. Any action to tackle single-use plastic is a good thing, but we must ensure any action is truly ambitious if we want to make the real difference needed to help save the planet.’
Jeff Knott, of the RSPB, said leaving the EU would give Britain the opportunity to move further and faster on environmental protection.
‘ It is impossible not to be moved by the sight of an animal in distress or dying due to becoming entangled in or swallowing the plastics found in our seas,’ he added.
‘A tax on single-use plastics is a positive step for addressing this. Leaving the EU gives the UK an opportunity to build on the great progress already made.’
Tisha Brown, of Greenpeace UK, said plastic pollution was a ‘global emergency’, with particles turning up in the stomachs of whales, turtles and 90 per cent of sea birds.
But she struck a cautious note, saying: ‘The Treasury’s announcement is only a statement of intent, but it recognises the significance of the problem and the urgent need for a solution.
‘There is a long way to go, but hopefully this is the beginning of the end for single-use plastic.’ Behind the scenes, Mr Hammond has clashed repeatedly with Theresa May in the run-up to next week’s Budget.
The Chancellor has been resisting pressure from Mrs May and Communities Secretary Sajid Javid to release billions for a new house building programme, but sources last night suggested he had relented and will unveil a significant package to address the crisis.