Mr. Sebastian Barnes:

That is a very good question. It is also a very difficult one to answer. Economists debate it endlessly. There are two perspectives. One is about how much debt we want, how much we want to pay for things now and how much we want to pass the debt on to the future, which is a moral philosophical question to which there is no easy answer. The other question is what is sustainable. If there were a shock, if interest rates were to go up, if growth were to fall, what starting debt ratio would avoid us getting into a position where debt is spiralling out of control and where we have to make a big fiscal adjustment? The higher debt is, the higher that risk. We have done some quite sophisticated modelling that draws on the work of the former IMF chief economist, Olivier Blanchard. He expresses it as a probability of debt becoming unsustainable. The most recent estimates indicate a probability of about a quarter that we could have shocks that would put debt into a situation where we would have to adjust the budget to try to restore the public finances.