Privatized Britain’s Debt Load Is Now a Major Government Problem
- UK firms have more than £40 billion of inflation-linked debt
- If companies fail, government may be on hook to clean up mess
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For decades since they were privatized, the UK’s public service providers have favored inflation-linked bonds as a cheap and easily-accessible means of financing. That’s now coming back to bite as borrowing costs surge to a 16-year high, potentially putting the government back on the hook to clean up the mess.