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Friday 14th December 2012 | 10:32
Institute of Economics Affairs press release
Commenting on a third major credit agency putting the UK’s AAA credit rating on negative watch, Philip Booth, Editorial Director of the Institute of Economic Affairs, said:
"The chances of a UK credit downgrade next year must be “fifty-fifty”. The event of a downgrade itself would not be catastrophic. However, it would reflect deep underlying long-term fiscal problems.
"Not only are we adding to the national debt very rapidly each year of this parliament, in addition there are strong fiscal headwinds from an ageing population. These are shared with other developed countries – including the US – and it is difficult to see how we can avoid a fiscal meltdown or long-term economic stagnation without radical policy reform."