Probably yes. There is a misconception between deficit and debt

The deficit is falling but as there is still a deficit we are obviously still borrowing so borrowing will be increasing.

Since 2008, public sector debt has increased sharply because of:

2008 recession (lower tax receipts, higher spending on unemployment benefits) The recession massively hit stamp duty (falling house prices) income tax and lower corporation tax.

These cyclical factors have also exposed an underlying structural deficit. (deficit caused by spending greater than tax, ignoring cyclical factors)

Financial bailout of Northern Rock, RBS, Lloyds and other banks.

Posted By: Tony Martin, Apr 1, 19:13:10