The good news is we're still worth £7trn (at least for now)

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The Independent Online

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.