The UK's national debt: a terrifying warning
OBR's 'grim' report on Britain's fiscal outlook warns of skyrocketing spending, but 'projection' is not a 'forecast'

When it comes to the public finances, Britain is swirling in a "maelstrom of denial, obfuscation and avoidance", said Paul Johnson in The Times.
In the coming years, we will need to spend untold billions more on health, pensions, defence and battling climate change, while losing tens of billions in fuel duties. Neither main party has any realistic plan for how this will be done. To our national shame, Labour, like the Tories before it, looks set to shirk the biggest fiscal challenge facing Britain today: fixing social care, which has been in a mess for decades.
And now, into this already turbulent picture, the Office for Budget Responsibility (OBR) has just chucked "an enormous brick", with its report on the fiscal risks facing Britain over the next 50 years.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Economic growth: the 'holy grail'
"No question, it is grim stuff," said Larry Elliott in The Guardian. It projects a near tripling of the national debt from just under 100% of GDP now (and 30% only 20 years ago) to 274% by the mid-2070s. Public spending is set to jump from 45% to 60% of GDP, as health costs double and pensions rise sharply, while government revenues get stuck at around 40%.
Crucially, the OBR's warning is a "projection" of what would happen on current trends, not a "forecast" of what actually will happen, said Martin Wolf in the Financial Times. The report itself notes that no government would let debt reach such an "unsustainable level". Still, the question is: how can we alter this terrifying trajectory?
The "holy grail" is economic growth, and its close cousin productivity. The OBR's sums are based on average productivity growth of 1.5% a year for 50 years. Even nudging that up to 1.6% would make a substantial difference. And if we managed to average 2.5% – the level before the global financial crisis of 2007/08 – the national debt would fall to 65% of GDP by the mid-2070s. Does Labour, though, have a realistic plan for achieving any of this?
Interest-fuelled 'doom-loop' of debt
"People sometimes ask me why we should worry about government debt rising from one massive number to even bigger numbers," said David Smith in The Sunday Times.
The short answer is: the cost of servicing it. In this decade, the cost of paying interest on the UK's national debt will average around £100 billion – "dwarfing the spending of most government departments". This risks sucking the nation into an interest-fuelled "doom-loop" of debt.
The main factors pushing debt higher are familiar and daunting: an ageing population; a falling birthrate; the costs of reducing fossil fuel use. Yet reducing the debt, by raising taxes and cutting spending, risks "hobbling the economy". We need to hear "much more" from the Government about how this circle will be squared.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
-
Garsington Opera opens its summer festival with two 'very different productions'
The Week Recommends A 'fabulous' new staging of Tchaikovsky's The Queen of Spades and Donizetti's fake-love-potion comedy L'elisir d'amore
-
The Rehearsal series two: Nathan Fielder's docu-comedy is 'laugh-out-loud funny'
The Week Recommends Television's 'great illusionist' has turned his attention to commercial airline safety
-
The Ballad of Wallis Island: bittersweet British comedy is a 'delight'
The Week Recommends A reclusive millionaire lures his favourite folk duo to an island for an 'awkward reunion'
-
Pocket change: The demise of the penny
Feature The penny is being phased out as the Treasury plans to halt production by 2026
-
Trump is trying to jump-start US manufacturing. Is it worth it?
Today's Big Question The jobs are good. The workers may not be there.
-
Grocery stores under fire for overcharging during cost-of-living crisis
The Explainer A recent investigation has put the spotlight on Kroger, but it is not the only chain being pinpointed
-
The UK-US trade deal: what was agreed?
In Depth Keir Starmer's calm handling of Donald Trump paid off, but deal remains more of a 'damage limitation exercise' than 'an unbridled triumph'
-
Shaky starts: A jobs drought for new grads
Feature The job market is growing, but Gen Z grads are struggling to find work
-
Visa wants to let AI make credit card purchases for you
The Explainer The program will allow you to set a budget and let AI learn from your shopping preferences
-
Why does the US need China's rare earth metals?
Today's Big Question Beijing has a 'near monopoly' on tech's raw materials
-
Work life: Caution settles on the job market
Feature The era of job-hopping for bigger raises is coming to an end as workers face shrinking salaries and fewer opportunities to move up