If you were listening to Radio 4 last night at about 10:30pm you would have heard France Coppola being interviewed about the recent goods news on the economy. She pointed out that growth in economic activity is correlated to a rise in consumer credit and a decrease in savings. This is "heading down the same track" as before the crash.
We need to be clear that if we base growth on spending savings and borrowed money that it will end in tears.
UK GDP is about £1.4 trillion. According to Humber Debt Solutions in July 2013:
Outstanding personal debt stood at £1.424 trillion at the end of May 2013.
This is up from £1.410 trillion at the end of May 2012.
Average household debt in the UK (including mortgages) was £54,024 in May.
This is up from a revised £54,002 in April.
The Office for Budget Responsibility (OBR) predicted in March 2013 that total household debt will reach £1.931 trillion in Q1 2018. This would mean that average household debt would reach £73,284 (assuming that the number of households in the UK remained the same between now and Q1 2018).The levels of debt that we are sustaining at present is a significant drag on the economy. We cannot add more debt and expect positive results in the long term. Any growth we get is likely to be short-term.