The two graphs show the Public Sector Government Receipts and Government Spending for Year 2002/03 figures from HM Treasury.
Notice that Income Tax Receipts of £ 114,000,000,000 and Social Security Payments £ 117,000,000,000 are very similiar.
It has always been the case that today's tax payers cover today's pensions.
Unfortunately when Income Tax and National Insurance Contribution receipts fall the Social Security payments rise.
In a recession this rapidly creates a serious deficit while in a boom this rapidly creates a surplus.
See also, that to the nearest billion the spend on the Health Service is the same as the NIC receipts.

In the short, medium and long term the United Kingdom Government are rather dependant on taxation revenues rising
by some 5% ( 20 billion borrowed ) above current end of April 2003 levels
without this there will come a point where Spending has to be cut.
The most obvious way of achieving rising taxation revenues is via fiscal drag,
that is freeze any inflation linked increases in Income Tax and National Insurance allowances
and thus capture between 22% and 40% of any new pay award to cover inflation.

Historically, Labour Governments in the United Kingdom : Borrow, Tax and Spend.
The Chancellor in his budget speech April 2003 announced that the borrowing would be higher than the 20 billion estimated
in the previous November and claimed that the borrowing would correct in three to four years.
Rather interesting, in terms of General Elections as the next one must be held by June 2006.

The two graphs show the Public Sector Government Receipts and Government Spending for Year 2008/09 figures from HM Treasury.

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