Is bankruptcy inevitable now for the UK

[BringOnTheHandyMan]

In the most layman of terms the UK is actually broke.

Every month we cannot pay the interest on our outstanding debt and thus have to borrow more. (Note this is not repaying the capital, just the interest)

The rate we pay to borrow used to be quite low and that is not the case anymore.
The bond markets have lost faith in the UK and charge us a rate that reflects it.

We have systems we can no longer afford (welfare, NHS etc)
We have little to no growth
We have inflation issues (so printing money is out)
Raising or cutting interest rates is problematic due to having both growth and inflation issues together
Our politicians are scrapping like rats in a barrel and even prior to that they seem incapable of making hard decisions or even facing up to the mess we are in.

We do actually need a PM that stands up and says okay folks we are in deep shit. We are broke. Actually worse than that. In debt and unable to pay even the interest.
So any borrowing we do must be for investing/growing the economy only. All spare money must be used for paying down debt or investing/growing the economy. That means for the foreseeable future all state funding is scrapped. We would enter a period of being very much a 'poor country' and acting like it. If we worked really hard we might be able to turn it around but it would take years, hard decisions and many, many sacrifices.

Since I can't see any party being able to actually do that. Then I honestly don't see how we can go anywhere except an IMF bailout. Then they will play the tough guys and cut the lot anyway.

I try to plan for my retirement but honestly it's sort of impossible.

For those with public sector pensions I wouldn't be sure you will get it paid
For those with private defined contribution pensions, the stock market is vastly overpriced just now and your pension is likely to fall once the AI bubble bursts.
State pension - yip not convinced we'll be getting that
Costs to be budgeted for - healthcare but how much?
Downsize my house - perhaps but will house prices tumble making this impossible.

Does anyone think that any government (regardless of party) can fix the country. If not what happens. The UK used to have no NHS or welfare so do we just go back to that. How long will it be until the wheels come off?

Lots of threads about which benefits should be cut etc but nobody seems to be shouting that actually it ALL needs to be cut regardless of what hardship it causes.

Nope, help and that means pension increases, should be targeted not blanket increases for all, based on the highest of 3 measures.

@PistachioTiramisu It's not dislike or hate. It's an understanding that current and previous pensioners have had a very generous deal and have been protected from economics shocks.

Triple lock was meant to be temporary, Winter fuel payment was meant to be temporary.

I can see no reason why pensioners get free prescriptions, free bus travel and all the other discounts.

As a group, they are less likely than other age groups to be in poverty.

It is imperative that we create generational fairness and that means pensioners have to contribute more and take out less.

I understand many are cash poor but asset (housing) rich - but they need to be pushed to downsize (and I would use an annual property tax) so that this housing is available to those who need it more than they do.

Pensioners living in large houses that they cannot afford, cannot maintain and often isolates them are often doing so to retain asset wealth to pass on to their families and also to try and avoid paying for the social care that they need (that they would need less of if they lived in a flat or supported living).

If you think pensioners are under attack now, I think you should look at history and what happens when young people get really angry at their situation, like in the cultural revolution.

Another poster mentioned people who took their pension out at 55 and then bought 'buy to let' - to further enrich themselves on top of state pension and often work pensions too.

Pensioners owning multiple properties, indeed anyone with a 'property portfolio' need to be paying a decent amount of tax.

Tbh the IMF are just setting the market expectations and any government the UK has will be expected to follow them. Labour has failed on disability and pensions. All this means is that the next PM, whoever that may be, gets the same collection of policy measures for managing the UK’s debt as already prescribed.

Reeves is doing what her predecessors did. Fiddling with income tax by not uprating allowances and freezing them. Tweaking certain benefits to uprate them. The Conservatives did this too. They chose not to cut either.

Labour were elected to handle disability benefits by getting quite a lot of people into medical treatment and back to work. That is nice bit. The other element was cuts, which is why the government is falling to bits. Burnham or whoever will just inherit this issue. The UK needs to wake up. Difficult decisions like this is what mainstream politicians are for. Otherwise you get extreme solutions later.

Agree totally.

Inherited from Blair and Brown government who started all this.

I think the point is that some perspective is needed. I can't believe a poster is referencing the good times for house prices being rock bottom in the early 90s recession, it makes me wonder if they were born then or something, talk about rose tinted glasses! I was 12 but old enough to recall it wasn't a great time for many!

I think what we have hit as a nation, is a very short attention span and our need for instant gratification is what is going to be our downfall.

If you want people with an assortment of mental health problems to work (which is reasonable) you have to invest in serious mental health support at base levels, in local surgeries. I am the wife of someone with mental health problems and believe me, telling them to get over themselves doesn´t work, it needs a more hands on solution and that means investment.

It's not that we can expect certain people to work - the jobs are mostly not there and likely not to be there in the future.

It's the expectation of people who are state supported, either partially or fully that their lifestyle will match those who are working.

State supported = absolute basics - NO luxuries (holidays/pets/cosmetics/takeaways)
Minimum wage work (full time) = basics + a few luxuries
Professional work = reasonable lifestyle

Interesting...

So pensioners have to be pushed out of the houses they own but UC recipients have to be housed in the areas they live in? why don't we reduce welfare housing bill by moving all benefits recipients to the cheapest areas of UK? they wouldn't be any left in London. Oh wait, they have their lives set up here, families, support network? same as pensioners?

Let me repost again, somehow people have religious believes about those pesky rich pensioners hording all money

Average income of British retirees revealed - and most don't have enough to be comfortable | Money News | Sky News

"The average tax-paying pensioner doesn't have enough income to live a moderate lifestyle, new analysis of government figures shows.
.....
The government figures only count those with enough income to pay tax, so anyone earning below the personal allowance is excluded from the average."

I hate to think how much housing benefit goes to London residents - seems a taboo subject

Sometimes when I read through threads such as these, it saddens me that many posters really seem to dislike/hate pensioners with a vengeance, and want them to be particularly targeted when Governments need to save money. I think they would like it if pensioners were summarily euthanised on reaching a certain age, so the resulting savings could be re-routed to them!

Any changes to pensioner benefits will impact future pensioners so no need for the hyperbole.

This creates an underclass of disabled people and their carers who are excluded from society completely though, unable to attend the events their family and friends invite them to unless someone who is aware of their situations takes pity on them and pays. This is absolutely not how these benefits were originally designed (disability benefits were always supposed to provide a disabled person with a dignified and acceptable quality of life - not that that is what's happening these days but that's not by design). I don't quite know the deal with carer's allowance - it seems like a pittance for some of the hardest work any human being could undertake, often for many hours longer than your average worker would ever be expected to work. I would not agree that we shouldn't aspire to providing the misfortunate in society with a decent standard of living and giving how many holidays the average person in the UK is able to afford this really shouldn't be out of reach.

I don't think anybody wants to remove a universal pension but we don't want Britain to go bankrupt so we are going to have to do things that we would prefer not to.

If we were talking about a household getting further in debt each year, paying more and more interest on their debts. They would prefer not to stop their foreign holidays or stop getting take aways but if they don't want to go bankrupt they will need to do something as debt increasing year on year is, at some point, not sustainable.

Giving state money to people that have enough money to support themselves is reasonable as a cutback to consider.

I could equally say that you cannot allow unlimited immigration and expect to survive as a society. The EU have made it clear that you cannot have EU membership without freedom of movement.

Rejoining the EU sounds nice, but would they want us back? I'm not sure we'd be let back in quickly and the terms of re-entry would be significantly less attractive. I'm all for applying to participate in the European Economic Area though.

It's not a universally popular idea though. There was a comment in today's Times, below the line section from someone (probably in a trade) who said, essentially, absolutely no way! His wages are up 25% and he has all the work he can handle.

But in times of real crisis as now, it should be not only reasonable but sensible to separate 'nice to have' from 'essential'.

This should also be a national picture; the HS2 has wasted how much money for what real outcome? And for example in the press today, the police sending 5 armed officers to an airport to arrest Graham Lineham for entirely legal tweets? What did that cost?

Giving disabled people enough money to have a life rather than an existence is not a "nice to have" - disabled people are at far higher risk of social exclusion and because of this, access to a social life is a human right as per the UN's Convention on the Rights of Persons with Disabilities. Keeping people effectively prisoner in their own homes because they can't afford to do anything but stare at the walls is a violation of this human right.

But yes, I agree about HS2 and Graham Lineham. Massive amounts of wasted money in the case of the former in particular. Very frustrating.

A lot of people who are not disabled are in exactly this position. They are allowed to go to work, pay taxes and live on the poverty line. Having enough to exist but not to have a social life or a few nice things because they simply can't afford it.

And, no, I do not believe the disabled have a total life of luxury... but as it stands, the UK government is squeezing it's working population in order to fund the non working population. And at least on paper, many non working people receive more money in benefits than people working full time. Something needs to be done to make working more attractive than receiving benefits.

Many disabled people receive far less than NMW though despite having costs far higher than a non-disabled person. And where they get more it's because they are deemed to have substantial costs. I don't agree with very low paid work either - everyone should have enough for a decent standard of living but a very small number of people are on NMW and as I say, it is significantly higher than a lot of people get in disability benefits (twice as much for a substantial portion).

There are disincentives not to lie to get disability benefits in the form of lengthy jail sentences and massive fines as per the case in the papers yesterday.

@lemonmeringuefry The point I tried to make is that in it's current form, the benefits system isn't working. It's great for everyone who is unable to work, to have a life, and be given enough money so as not being socially excluded. But, there's simply not enough money coming in to pay out money for having a life especially when the people funding this, are very much existing - the green eye monster and all that.

In the spirit of this thread this is an economical, political and social issue. It is a creation of THEM versus US. MN is full of these types of threads. Just remember, the UK is headed for bankruptcy if we don't wake up and adress all 3 issues.

There is something wrong when people that don't work can afford to go out for a drink/meal and have a holiday yet people that are paying for others, can't afford it for themselves. Utter madness.

Nobody on NMW is subsidising anyone - they are being subsidised themselves by the higher earners who are net contributors, just to a lesser degree than those unable to work due to disability, caring responsibilities or unemployment etc. And they get vastly more than many on disability benefits despite not having the costs associated with disability.

But I am in favour of everyone being be paid enough to be able to cover their basics and have a little left over. We are relentlessly trying to take tiny amounts from the disabled and poorest though when this isn't going to solve our problems. It will just lead to more tent cities and homelessness and increased costs to the NHS and care sectors.

Most people are not just existing though. Yes, the bottom 20% may be but the average person, according to ABTA, goes on 4 holidays a year, 2 of them international, with many people (the majority of them families with children) going on between 5 and 8 holidays a year. We are not as a nation struggling anywhere near as much as people are making out. And yet many with very comfortable lifestyles keep trying to argue that those unable to work should have even less, usually on the basis of completely inaccurate ideas of how much most of us receive to begin with.

The benefits systems is struggling, yes, but, cutting and cutting and cutting until we have tent cities like in the states and all the costs associated with that is not going to make us better off as a nation.