Here's a telling graph of how much "in debt" we are in comparison to yesteryear...
OK, it's not great, but we've been here before. As I understand it, it is the Private Debt that is causing most concern - that is the money that our banking sector has borrowed. Yes, the same banking sector that is paying out mahoosive bonuses each year.
By the way, if you read an article by Moneyweek called "The end of Britain" it is complete hoop in my opinion (advertised on Prune, no less). All of their scaremongering graphs have not been adjusted for inflation. They have omitted to add that they failed to predict financial crises like Lehman Bros, Northern Rock and alike - they are being very misleading in my humble opinion. It's actually looks like a thinly disguised sales ploy/scam by Moneyweek to get more subscriptions to their magazine - don't believe the hype! Sales of magazines/newspapers are reducing rapidly due to the volume of free online content.
Anyway, take a look at the above graph and ask yourself "why have we had 2 years of pay freeze and now 1%"? My answer is "incompetence, corrupt contracts and waste" - I see it everywhere...
LJ