Britain Binged On Debt
Over the past few years, our economy has become bloated; due to Brits bingeing on debt and not done anything to work off the excess, claims Reform.
According to the independent think tank, this tendency to rely on cheap credit cards and cheap loans to support spending habits has produced an economy that is unfit and working inefficiently. A new report from the group notes that it is not just consumer borrowing that has caused the countrys coffers to become corpulent with debt, as the public structural budget deficit has become the fourth highest of all countries in the Organisation for Economic Cooperation and Development. Meanwhile, Britains trade deficit is continuing to burgeon, while public spending programmes are based on out-of-date and over-optimistic forecasts for gross domestic product (GDP) growth, the group warned.
It's also been warned that over the coming years, around 4000 will have to be paid by the average taxpaying family, in an attempt to rebalance the national debt, that's equivalent to 100 billion pounds in tax contributions each year.
Ahead of the pre-Budget report, which will be announced on Monday 24th November by Alistair Darling, warned that simply injecting more public money into the banking industry will have little lasting effect on the state of the countrys economy. Reform also warns, that cutting public expenditure on vital long-term development programmes is equally ill-advised, claiming that recent history shows, cutting spending will inevitably lead to increased investment a few years down the line.
The group insists that there is only one course of action that will relieve the strain of the national debt: "In order to move beyond the obese economy, Britain has to consume less and work more. Households need a sense of direction towards a higher saving, lower tax economy. The short-term objective is the same as the long-term path to economic growth - to increase productivity. This should be the theme of the Pre-Budget Report and of Budget 2009."
Furthering this, it called on the chancellor to focus on three key objectives when delivering his report: public sector reform, private sector productivity and personal productivity.
Finally, the group insists that the government must provide support to individuals in an attempt to stop them relying on loans and other types of credit and start spending their own money, as they are vital to economy recovery.
For those who have seen their finances blown out to sea in the recent economic storm, taking out a debt consolidation loan may prove an effective way to get back on a firm footing monetarily. Meanwhile, the number of people who are in need of a debt consolidation loan may grow in the coming months as the independent financial advice site the Motley Fool warned that millions of Britons are unprepared for a recession.
According to the independent think tank, this tendency to rely on cheap credit cards and cheap loans to support spending habits has produced an economy that is unfit and working inefficiently. A new report from the group notes that it is not just consumer borrowing that has caused the countrys coffers to become corpulent with debt, as the public structural budget deficit has become the fourth highest of all countries in the Organisation for Economic Cooperation and Development. Meanwhile, Britains trade deficit is continuing to burgeon, while public spending programmes are based on out-of-date and over-optimistic forecasts for gross domestic product (GDP) growth, the group warned.
It's also been warned that over the coming years, around 4000 will have to be paid by the average taxpaying family, in an attempt to rebalance the national debt, that's equivalent to 100 billion pounds in tax contributions each year.
Ahead of the pre-Budget report, which will be announced on Monday 24th November by Alistair Darling, warned that simply injecting more public money into the banking industry will have little lasting effect on the state of the countrys economy. Reform also warns, that cutting public expenditure on vital long-term development programmes is equally ill-advised, claiming that recent history shows, cutting spending will inevitably lead to increased investment a few years down the line.
The group insists that there is only one course of action that will relieve the strain of the national debt: "In order to move beyond the obese economy, Britain has to consume less and work more. Households need a sense of direction towards a higher saving, lower tax economy. The short-term objective is the same as the long-term path to economic growth - to increase productivity. This should be the theme of the Pre-Budget Report and of Budget 2009."
Furthering this, it called on the chancellor to focus on three key objectives when delivering his report: public sector reform, private sector productivity and personal productivity.
Finally, the group insists that the government must provide support to individuals in an attempt to stop them relying on loans and other types of credit and start spending their own money, as they are vital to economy recovery.
For those who have seen their finances blown out to sea in the recent economic storm, taking out a debt consolidation loan may prove an effective way to get back on a firm footing monetarily. Meanwhile, the number of people who are in need of a debt consolidation loan may grow in the coming months as the independent financial advice site the Motley Fool warned that millions of Britons are unprepared for a recession.
About the Author:
Abbi Rouse writes for All About Loans. Our visitors can apply online for car loans. We also specialise in cheap loans, and debt consolidation loans.
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