Well, maybe not quite THE answer but we have some thoughts and ideas on this subject.

Firstly there is pretty much a unanimous view amongst the major political parties that we have to reduce national debt.  But equally there is also a consensus that we cannot reduce debt too quickly such that we enter into a situation where we plunge the economy into the deep and prolonged recession (or depression).

In effect it is a balancing act, how do we reduce national debt quickly enough without creating a prolonged recession?  There is no easy answer to this, otherwise our politicians would be less reticent about giving us clear information on how they intend to deal with the UK’s debt problems.

Well, as we don’t have to stand for election it is probably easier for the editors at the house4sale blog to make some comments and suggestions, and who knows we might even spark some ideas for our political masters … ok, maybe we are getting a little carried away

So here are 5 suggestions:

1 – Increase taxes on those areas that are less harmful to the UK economy. For example, tax goods where there is a very high percentage of imports, white goods, plasma TVs and the like may fall into this category.  This isn’t an import duty, this is an additional tax on sales that targets a product category, thus increasing tax revenues without contravening international trade conventions.

2 – Reduce final salary pension commitments in the public sector.  Whilst we feel it would be unfair to reduce payments for those already receiving pensions maybe increasing focus on those who have not yet retired is to be considered.

3 – Increase the retirement age immediately, maybe not making it compulsory for the next 5 years but at least giving people the opportunity to choose to keep on working. 

4 – Stop funding university places for degrees that do not improve the economy.  For example do we really need degree courses in wind surfing? And just how many degree courses in media studies should the tax payer fund?

5 – Cut back on benefits.  According to Government statistics we have over 8 million people of working age that are “economically inactive”, this compares with 28 million employed.  To put it another way over 1 in 5 people of working age are potentially claiming benefits. Every £1000 per person saved in benefits equates to £8 billion p.a.

Some of these are tough measures, but we have to take tough decisions if we are to at least maintain future living standards. Taking no action is not an option.