Since 2000, personal debt has almost doubled in Britain. The average Briton now owes £33,000 ($68,000) in mortgages, credit card debt and personal loans—sharply up from £17,000 just seven years ago. Will consumer spending ever reach a wall?

According to PricewaterhouseCoopers, the accountancy firm that released the statistics, Britons are again set to increase debt levels as the Christmas shopping season enters full swing.

The report delivers a bleak outlook about the level of consumer borrowing in Britain, saying that many households may have already stretched their borrowing capacity to the breaking point and predicting a sharp rise in the number of insolvencies.

Mushrooming personal debt levels are occurring at a precarious moment for the British economy: The credit crisis is accelerating, Northern Rock is failing, and home prices are falling.

“There are tough times ahead for consumers,” says Richard Thompson, a partner at PricewaterhouseCoopers. “Banks are continuing to take action in response to the rise in consumer debt by tightening their credit acceptance policies.

“Many consumers will find it increasingly difficult to obtain credit in the run-up to Christmas. After many years of rapid growth the consumer credit market has well and truly stalled. We believe that consumer credit borrowing levels have reached a natural ceiling” (Telegraph,November 27).

Slowing consumer spending would wallop the British economy. Over the past several years increasing consumer spending has powered much of the country’s economic growth. The rising personal debt levels reveal that much of the increase in spending was due to more borrowing rather than increased wages.

“Without the large increase in borrowing of the last few years by both the public and private sectors the economy would have already slid towards recession,” notes Roger Bootle, managing director of Capital Economics (ibid.).

Bootle says that the “borrowing splurge” may have only “postponed the evil day” of recession. He says that with all the debt in Britain, the economy is hanging on the fickle whims of the housing market and employment.

If America is a guide, the housing market may be about to deteriorate dramatically in Britain. Prime Minister Gordon Brown seems to agree. During his visit to the Commonwealth summit in Uganda, he blamed the current mood of economic uncertainly squarely on the U.S.: “I think everybody knows that what has happened in America. It is already having an effect on the housing market and the question is what will be the effect on the rest of the world.”

Tough times may be about to descend on Britain. Consumers are mortgaged to the hilt and personal debt levels are sky high, but the economy is dependent on increasing consumer spending. Now home prices have fallen for two months in a row and consumers are finding it difficult to increase borrowing. Is consumer spending about to hit a wall? If it is, economic conditions may be about to change dramatically for the worse.