By Daniel Martin
Last updated at 12:19 AM on 19th August 2009
David Cameron has warned that Britain could default on its national debt if it keeps borrowing more money. The UK is set to have the worst debt of any major European economy next year as plummeting tax revenues force the Government to borrow from international investors. It has fuelled fears the country is facing decades of cuts to public services or tax rises to rebalance the books. But now Mr Cameron has raised the spectre that Britain will not be able to pay off the huge debts at all – putting the economy at serious risk. He condemned Labour’s plans to take the national debt to £1.4 trillion, by borrowing £700billion more over five years, as a ‘disgrace’. Mr Cameron claimed Britain’s worsening economic situation meant investors may seek higher interest rates in future, making it increasingly likely the Government will not be able to honour its debts. He said at the Royal Society of Arts: ‘You can get to a level of Government debt where, not that it becomes certain that people will cease to lend you the money, but you start running the risk of them demanding higher premia, higher interest rates – or you run the risk of not being able to meet your obligations.’ Read more: http://www.dailymail.co.uk/news/article-1207537/Britain-default-debts-keeps-spending-warns-David-Cameron.html#ixzz0Ob3fZzSU
