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shocks to the economy, even though the scale and timing are inherently unpredictable and anyanalysis of potential future shocks can only be illustrative. Chart 1.9 shows how the level ofpublic sector net debt in 2035-36 would be affected by a simple scenario in which the economyis hit once every 8 years by a shock that increases public sector net debt by 10% of GDP (lessthan the peak increase following the recession in the 1990s). This should not be interpreted as aprediction, though increases in debt of this magnitude are consistent with the previous impactsof economic downturns on public borrowing.Chart 1.9: Projections of public sector net debt in 2014-15 and 2035-36 underdifferent policy assumptions, with and without illustrative shocks9080% GDP706050403020100Debt in 2014-15 Debt in 2035-36(0.3% surplus)Debt in 2035-36(current budget balance,1.4% overall deficit)Projected debt (excluding shocks)Illustrative shock that increases public sector net debt by 10% of GDP every 8 yearsstarting in 2019-202014-15 level of public sector net debtSource: Office for Budget Responsibility and HM Treasury.1.69 In this illustrative scenario, a permanent 1.4% deficit, equivalent to a balanced currentbudget with investment equal to its 2019-20 forecast level, results in debt falling by only around3% of GDP by 2035-36 from its 2014-15 peak, still leaving debt at historically high levels. Apermanent 0.3% surplus, as forecast by the OBR for 2019-20, under the same scenario results indebt falling from its peak by around 25% of GDP by 2035-36. Larger or more frequent shocks inthe future would result in higher levels of public debt and vice versa.Consolidation in the next Parliament1.70 Budget 2015 confirms that, in line with previous policy, the government’s plannedconsolidation in the next Parliament is reflected in the fiscal assumption that Total ManagedExpenditure (TME) will fall in real terms in 2016-17 and 2017-18 at the same rate as over theperiod 2010-11 to 2014-15. Alongside the updated Charter for Budget Responsibility thegovernment estimated that around £30 billion of discretionary consolidation is likely to berequired over these years. From 2018-19 the government has set a neutral fiscal assumption,26 Budget 2015