Conservatives highlight UK's debt problems

18 September 2007
Conservative party leader David Cameron has questioned the government's handling of financial affairs following the news that a number of financial firms are feeling the impact of the "credit crunch".

Writing in the Sunday Telegraph, Mr Cameron said that conditions within the financial markets were now affecting everyone, while also posing risks to the UK's overall economic stability.

Arguing that the government has seen a "huge expansion" of debt within the UK, the opposition leader said personal debt had trebled to £1.3 trillion – more than the country's income as a whole.

"And as any family with debts knows, higher debt makes us more vulnerable to the unexpected," he commented.

Debt has now reached a point where interest rate rises can have a dramatic impact upon homeowners and mortgage repayments are now at their highest point for 15 years, he stated.

Last week, chancellor Alistair Darling called for a return to "old-fashioned banking" to ensure that lenders weigh up the potential risks when people borrow money, the Daily Telegraph reports.

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