The good news is we're still worth £7trn (at least for now)
Iceland...Hungary...Ukraine... At a time when almost every day brings news of another sovereign state going bust, it is comforting to know the UK is at least solvent – and to the tune of £7 trillion. Even though recession seems inevitable, and government borrowing is soaring while house prices seem destined to fall forever, the UK is still worth a surprising amount.
The net wealth of British households, companies and official bodies, even taking into account the mountains of debt, has touched £7trn – that's £7,000bn, or £7 million million.
According to the Office for National Statistics (ONS), in 2007 the UK's net assets rose to a record £506bn, or about 8 per cent above their 2006 level. British households were thus valued at a total of £7.5trn, even taking account of their mortgages and other debts, which run to about £1.7trn. On this reckoning every UK household is worth £300,000, and each man, woman and child £125,000, on average.
Or they were. The falls in the stock markets and the slump in house prices will have wiped roughly £1trn off that total – the first fall in national wealth since 1992. Even so, the UK's wealth will still have doubled in size in a decade, a growth rate that reflects the rapid rise in house prices as well as mostly healthy economic growth over the period.
By far the biggest asset owned by the nation is the housing stock. This makes up about 60 per cent of the total, up from about 50 per cent of national net worth at the beginning of this decade. Stocks, shares, bank accounts and pension plans are in fact a much bigger gross asset, at almost £26trn, but are more than outweighed by the national burden of debt – public and private – to leave a net negative contribution of £381.6bn on the national balance sheet. Offices and factories and the national fleet of cars, lorries, aircraft and ships make up most of the rest of the national wealth.
In terms of who owns what, again the British householder takes pride of place. Modern Britons, with their notorious appetite for debt, are still worth more than they owe – with a net worth of £4.1trn, even after £1.5trn in mortgages and debts have been accounted for. Public corporations and local government are also in the black, but central government is not.
It is not quite clear what value has been assigned to 10 Downing Street, Buckingham Palace and other national treasures but, according to the ONS, central government still has liabilities exceeding its assets to the order of £202bn. Nor is any particular worth attached to pieces of national "human capital" such as the leadership of Gordon Brown, the judgement of George Osborne or the "talent" of Russell Brand and Jonathan Ross. Private companies and, perhaps unsurprisingly, the banks are also in the red.
With the fall in national wealth brought by a recession, we are likely soon to feel poorer, and to be poorer as well. But there is still a very large cushion before this country finds itself with liabilities exceeding its assets.
Missing Malaysia Airlines Flight MH370: Wreckage could be found within a week as search reaches 'very critical juncture', says minister
South Korea ferry disaster: Released transcripts show chaos and confusion in the moments before ferry sinks
Unbeliebable: The White House offer 'no comment' to anti-Justin Bieber petition
Loch Ness Monster found on Apple Maps?
South Korea ferry disaster: Families watch as remains of Sewol victims returned to shore
The food poverty scandal that shames Britain: Nearly 1m people rely on handouts to eat – and benefit reforms may be to blame
Scottish independence: It is the English who should be on their knees, begging the Scots to vote ‘No’
'Sinful': Video of British Muslims dancing to Pharrell Williams's hit Happy comes under attack
Nigel Farage: I’m taking on the status quo, and the Establishment’s fighting back
Abdullah Deghayes: My son was the martyr of a just cause, says father of British teenager killed in Syria conflict
Ukraine crisis: Helicopter gunships take country closer to all-out war
- 1 Chelsea 1 Sunderland 2: Graceless reaction of Jose Mourinho a sad effort to hide his own flaws
- 2 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 3 Unbeliebable: The White House offer 'no comment' to anti-Justin Bieber petition
- 4 Loch Ness Monster found on Apple Maps?
- 5 Shropshire criminals ‘using unmanned drones and infrared cameras to find illegal cannabis farms’ – and then steal from the growers
iJobs Money & Business
Negotiable: Harrington Starr: Database Team Lead ( Leadership, Sybase, Compute...
£40000 - £50000 per annum + Bonus+Benefits+Package: Harrington Starr: C#.NET D...
£25000 - £35000 per annum + Bonus+Benefits+Package: Harrington Starr: VB.NET S...
£45000 - £55000 per annum + Bonus and Benefits: Harrington Starr: Trade Suppor...