trading economics

• a budget deficit refers to when a 12 month period has a net outflow of money as government expenditure exceeds tax revenue
• A budget surplus refers to when tax revenue is greater than government expenditure in a 12 month period
• National debt refers to the total accumulation of budget deficits from many years, and is what the government owes
• the UK has a national debt of £2.7 trillion, and its national debt is 97.6% of its GDP
• 16% of the UK's working population is employed in the public sector, meaning less government expenditure will cause high unemployment
• 1.6 million are employed by the NHS, 1.5 million work in education, and 1.1 million work in public administration
• The UK government finances their debt by issuing Gilts, a bond issued by the government which pays the holder a fixed cash payment (interest) until maturity
• upon maturity, the bondholder receives their initial investment back from the government as well as their interest