Should we worry about government debt?

Published on 11 April 2024

David Miles joins us to discuss high government debt and its impact on the economy.

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We often hear about government debt in the headlines. Currently the UK government owes around £2.65 trillion, nearly 100% of UK GDP - the value of all the goods and services produced in the UK in a year.

How has the debt level grown? Should we aspire to reduce the debt? And do we need to worry about high debt to GDP ratios?

Joining us today to answer all these questions and more, is David Miles, Professor of Financial Economics at Imperial College Business School, a member of the OBR Budget Responsibility Committee and former member of the Monetary Policy Committee at the Bank of England.

Zooming In: discussion questions

Every week, we share a set of questions designed for A Level economics students to discuss, written by teacher Will Haines.

1. Why was the government able to reduce the government debt to GDP ratio at a fast rate following WWII?

2. Explain why increasing government spending to invest could actually end up reducing the government debt to GDP ratio over time?

3. Assess the potential macroeconomic policies which could be adopted to reduce UK government debt as a percentage of GDP.