The public sector in surplus

<p>Whilst many countries still struggle to control the growth of public sector debt, the UK Government is repaying debt at the rate of some ñ4 billion a year. The Chancellor takes pride in the elimination of the Public Sector Borrowing Requirement (PSBR), but he would be content to 'balance the budget'; it is not his ambition to reduce the size or the national debt. Nevertheless the size of the debt is being reduced. In this paper I address three issues: Why is the public sector now in surplus? Will it remain in surplus? Should the persistence of a surplus be a matter of concern?</p>