BBC
Sunday, Dec 21, 2008
The level of debt in the UK is “disturbing,” the head of the International Monetary Fund has said.
But Dominique Strauss-Kahn told the BBC that given the severity of the economic downturn, more government borrowing was the lesser of two evils.
He said 2009 would be “a really bad year” and more state spending was necessary to stimulate growth.
Public debt has risen to £650bn, 44.2% of UK gross domestic product. Consumer debt is more than £1.4 trillion.
In last month’s pre-Budget report, the chancellor announced plans for a £20bn economic stimulus package, which would bring public debt close to 50% of GDP.
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‘Less bad solution’
Mr Strauss-Kahn said governments around the world had no choice but to step in and spend more.
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