Week 17, 2013: Historical UK Government Debt

Summary: This week we have updated a graph produced by the UK Debt Management Office of historical government debt, going back to 1855, with the latest figures from the Office for National Statistics (up to 2012).

What does the chart show? The chart shows the level of gross debt held by general government (central government plus local governments) in the UK. The red line, measured against the left hand axis, shows debt as a percentage of Gross Domestic Product. The blue line, measured against the right hand axis, shows nominal debt (not allowing for inflation) in billions of pounds.

Why is the chart interesting? Over the past ten years, gross government nominal debt has skyrocketed from around £400bn to just under £1.4tn.  While that in itself is remarkable, it now more importantly represents around 90% of our GDP.  That is not the highest it has ever been, as is sometimes reported, but it is higher than it has been for 102 of the past 150 years.  The main period when it was higher as a percentage of GDP was between 1917 and 1964, although according to the historical data used by the Debt Management Office it was also higher pre-1862.  

It is worth noting that, as the DMO point out, general government gross debt is not the preferred method of measuring public debt - that is Public Sector Net Debt - but it is the best historical data we have available.