EARLY January, and it isn’t just the usual excesses that have to be worked off. Many people’s thoughts turn to debt — and it will take more than lycra and a gym membership to tackle that.

Debt will lead 30,000 people into insolvency between now and the end of March, says Grant Thornton, the accountancy firm. Liberal Democrat shadow chancellor Vince Cable claims that a combination of ready access to borrowing and legal changes that have made personal bankruptcy easier mean debt levels are unsus- tainable and a “debt mountain” hangs over the economy.

The Organisation for Economic Co-operation and Development (OECD) notes that household debt levels in Britain are more than 100% of gross domestic product, and thus the highest in the G7; above America, Canada, Japan, Germany, France and Italy.

Rising household debt has been a central feature under Gordon Brown, the chancellor whose guiding stars were said to be prudence and parsimony. Rising government debt is another story, which I will return to soon.

When Brown entered the doors of the Treasury in May 1997, household debt was just under £500 billion; now it is nearly £1,300 billion. That, in a period of low inflation, is a big increase.

The question of debt is the classic one of: “Is the glass half full or half empty?” Depending on which way you look at it, people’s willingness to take on debt either reflects their confidence in the future, and hence their ability to repay it; or it is an impatient desire to have it all now, whatever the long-term consequences. Inevitably, there is a bit of both.

But how worried should we be? Is it the case, as Cable argues, that debt now hangs over the economy in a way that will significantly affect it? Or is it, as Bank of England governor Mervyn King has insisted repeatedly, that debt represents a potentially serious social problem but is not a big macroeconomic concern? Let me start with a few basic facts. Figures from the Bank last week showed that the level of outstanding individual debt is £1,278 billion, of which £1,066 billion, 83%, is secured on dwellings, and £212 billion is unsecured. In the past 12 months secured debt has risen by 10.4%; unsecured debt by 6.2%.

Britain, as noted, ranks near the top of the OECD’s debt league table, measured against GDP, although it is in the same ballpark as other “Anglo Saxon” economies; America, Canada, Australia and New Zealand. An alternative measure — the proportion of annual disposable income — put UK debt in 2005 at 159%, above America (135%) and Canada (126%) but below Australia (173%) and New Zealand (181%).

The outliers are Denmark, with debts of 260% of disposable income, and the Netherlands, 246%. At the bottom are France, 89%, and Italy, 59%.

These international differences tell us something about the willingness of people in various countries to borrow to consume. Contrary to what you might expect, there is no direct link between debt and levels of home ownership. Denmark and the Netherlands have lower levels of owner-occupation than Britain but more debt. Italy has roughly 80% owner-occupation but low debt.

The other side of the balance sheet to debt is net wealth; what households own in financial and non-financial (mainly housing) assets. In every advanced country, households are in pretty good shape, with net wealth ranging from 319% (Finland) to 936% (Italy again, surprisingly) of annual disposable income. Britain comes out pretty well, with net wealth of 790% of household income. This means that in theory we could live for eight years on the proceeds of selling our houses and financial assets, but in practice it could never happen, certainly not for all.

What is the debt problem? The fact that household balance sheets in aggregate are in good shape should not divert us from the reality that a minority have balance sheets that would make even Enron accountants wince.

More than half of households in Britain have no debt at all, says the OECD. That includes most pensioner households but also quite a number of working-age homes. So the £1,278 billion of debt is divided among the minority.