Blog: Why £4.3bn of debt is a good thing

January is traditionally the month in which government collects large amounts of tax - and City economists had expected a surplus of £2.3bn. Such a surprise prompted a rise in gilt yields to a 15-month high of 4.1pc. The pound also weakened. Yet, while a further hike in indebtedness raises questions about the state of the UK's public finances - it is undoubtedly good news for pension schemes and those approaching retirement. Increases in gilt yields should reduce scheme deficits. This is because bond yields are used to help calculate liabilities under FRS17 and IAS19 accounting rul...