§ Mr. Tim SmithTo ask the Chancellor of the Exchequer if he will publish in theOfficial Report an analysis of the total national debt of £197 billion as at 31 March 1988, showing how much was incurred in the following periods: (a) 1979–80 to 1987–88, (b) 1974–75 to 1977–78, (c) 1970–71 to 1973–74, (d) 1964–65 to 1969–70 and (e) 1959–60 to 1963–64.
§ Mr. Lilley[holding answer 13 March 1989]: Taken literally, the question appears to ask what fraction of the particular stocks currently outstanding (31 March 1988) was issued, net of redemptions, during each period. Figures for Treasury Bills and the various National Savings products are unavailable. Of those gilt-edged stocks currently outstanding (nominal value = £140.9 billion) the (net) amounts incurred were as follows:
£ billion (a) 1979–80 to 1987–88 109.5 (b) 1974–75 to 1979–80 21.5 (c) 1970–71 to 1973–74 3.9 (d) 1964–65 to 1969–70 2.4 (e) 1959–60 to 1963–64 1.9 However, such a series is not very informative. The average life of gilt-edged stocks is somewhere near eight years, and debt has to be issued continually to replace any that is redeemed; we would almost always expect to see a declining series, as above, whatever the relative strengths of public sector finances in each period.
However, the national debt is not the most useful or comprehensive measure of public sector indebtedness. It includes debt held by official bodies within central Government, it does not cover the whole of central Government and it excludes entirely the debt of other parts of the public sector. In addition, it takes no account of the public sector's short-term assets, including foreign exchange reserves.
A better measure is the public sector net debt, which is analagous to the PSBR-PSDR.
In 1987–88 prices, the total PSBR over each period was as follows:1
Revisions to 1988–89 voted cash limits Class Vote Accounting department Description of expenditure Current cash limit £000 Decrease £000 Revised cash limit £000 I 12 Ministry of Defence Defence Procurement 8,822,266 531,169 8,291,097 XVI 2 Department of Agriculture and Fisheries for Scotland Agricultural services and fisheries 76,542 445 76,097 XIX 13 Her Majesty's Treasury Central Computer and Telecommunications Agency 18,490 406 18,084 XX 13 Office of Fair Trading Office of Fair Trading 10,227 75 10,152 Total 532,095 1 The five cash limited Defence votes are each separate cash limits but, by agreement with the Treasury, are managed as a cash block. Underspend on expenditure eligible for the scheme in these cash limits was carried forward to Class 1, Vote 2.