London, June 8 (IANS) British Prime Minister David Cameron has warned of severe spending cuts to check the rising national debt that now stands at 770 billion pounds.
In a keynote address on the economy Monday, Cameron has said if nothing was done about it, the debt would rise to 1.4 trillion pounds in five years, meaning a per head burden of 22,000 pounds for every man, woman and child in the country.
He said: ‘Now we have looked at the figures, based on the calculations of the last government, in five years’ time the interest we are paying on our debt is predicted to be around 70 billion pounds. That is a simply staggering amount. No wonder the previous government refused to publish the information.’
The interest amount equals the cost of running all schools, the entire transport system and climate change costs in England. In monetary terms, it means that for every single pound people pay in tax, 10 pence would be spent in interest.
‘Let me explain what it means. Today we spend more on debt interest than we do on running schools in England,’ he said.
Taking a broadside at his predecessor Gordon Brown, Cameron said: ‘What a terrible, terrible waste of money. So, this is how bad things have got. This is how far we have been living beyond our means. This is the legacy our generation threatens to leave the next.’
The prime minister made it clear there will have to be tough decisions on pensions, public sector pay and benefit payments. The prime minister did not detail where the axe would fall, but by giving examples of Labour’s ‘reckless’ spending, he highlighted potential candidates for cuts. He referred to how benefits had increased by more than 20 billion pounds with some families receiving up to 93,000 pounds in housing benefit a year; defence projects had overrun by 4.5 billion pounds; and the number of NHS managers had doubled.
And he made his starkest statement yet on how the wide-ranging Whitehall cuts will be and the impact they will have. ‘How we deal with these things will affect our economy, our society – indeed our whole way of life. The decisions we make will affect every single person in our country and the effects of those decisions will stay with us for years, perhaps decades to come.’
However, Cameron claimed Britain was still in a better position than debt-reeking countries like Greece. ‘And crucially we now have a government that has already demonstrated its willingness – and ability – to deal with the problem. But Greece stands as a warning of what happens to countries that lose their credibility, or whose governments pretend that difficult decisions can be avoided.’
Shadow chancellor Alistair Darling hit back, dismissing Cameron’s charge as ‘nonsense’, insisting it was a classic case of a new government blaming the previous one simply to pave the way for things it always wanted to do.
