Parliamentary Committees and Public Enquiries
Unknown costs of Brexit limit ability to react to economic shocks
The Public Accounts Committee report says Government's high level of debt leaves little room for manoeuvre in public spending and the as yet unknown costs of Brexit place a further limit on the Government's ability to react to further economic shocks.
- Read the report summary
- Read the report conclusions and recommendations
- Read the full report: Government borrowing and the Whole of Government Accounts
Decisions affecting public finances will need to be sufficiently visible
As the Government looks to reduce borrowing and debt to meet its fiscal targets, decisions affecting the public finances will need to be sufficiently visible to Parliament and the public.
The UK Debt Management Office and National Savings & Investments ability to respond to any financial crises and possible need to increase borrowing levels significantly may be more difficult in the future; because of the increasing exposure to rising inflation and the eventual unwinding of the Bank of England's quantitative easing programme.
The Whole of Government Accounts (WGA) provides us with a clearer picture of all public sector finances than ever before. It is particularly useful in highlighting future liabilities such as pension costs.
Work still to be done to ensure accounts are useful and useable
We are encouraged by the improvements that the Treasury has made to the WGA, but its value remains limited by the delays to publication and the lack of information in key areas.
We welcome the steps that the Treasury is taking to strengthen the understanding and management of the Government balance sheet but, to have a lasting effect, the Treasury will need to embed best practice in routine decision-making across government to ensure we are both harnessing the assets and managing down the risks from our increasing liabilities in the longer-term.
There is still work to be done to ensure that the WGA is a useful and useable document for Parliament and ultimately the individual citizen and taxpayer.
Comment from Committee Chair, Meg Hillier MP:
"There is little wiggle room in the UK’s public finances. Government accepts public sector debt is too high yet it expects to increase the amount it will borrow by some £55 billion over the next few years.
Taken with the continued uncertainty over the financial impact of Brexit and rising levels of personal debt, I am concerned about Government’s capacity to respond to future shocks to the economy.
In this context it is vital that as far as possible Government fully identifies the risks ahead and is open with Parliament and taxpayers about decisions it takes that affect the public purse.
The abolition of autumn statements and spring budgets in favour of an annual autumn budget is intended to enhance transparency, yet it is not yet clear how this will work in practice. This must be resolved urgently.
There is also work required to improve the usefulness of the Whole of Government Accounts—potentially a powerful tool for examining the state of public finances, but one which is inevitably undermined by delays to publication and a lack of clarity in areas such as pension liabilities and regional spending."
Latest News from
Parliamentary Committees and Public Enquiries
Committee launches new Economic Crime inquiry26/10/2020 15:33:00
The Treasury Committee completed an inquiry into economic crime in the previous Parliament.
Covid has had a huge impact on key Scottish sectors22/10/2020 15:33:00
A report published by the House of Commons’ Scottish Affairs Committee has highlighted the devastating impact on Scotland’s key sectors by the coronavirus pandemic.
Committee reports on Gibraltar-Spain border arrangements and European Investment Bank22/10/2020 13:33:00
In its latest report, the European Scrutiny Committee considers recent draft EU legislation and policy documents deposited in Parliament by the Government.
New arrangements for UK nutrition policy scrutinised by committee22/10/2020 11:38:00
The Common Frameworks Scrutiny Committee has written to Health Minister Edward Argar MP on the Provisional Framework on Nutrition Labelling, Composition and Standards (NLCS), following its publication on 9 October.
Committee call for evidence on effectiveness of proposed deal21/10/2020 15:43:00
The Environment, Food and Rural Affairs (EFRA) Select Committee today launches a short call for evidence in order to scrutinise the proposed Fisheries Framework Agreement between the UK and Norway.
Chair calls on Government to publish list of companies that received furlough money19/10/2020 15:33:00
The Public Accounts Committee is calling on HMRC to give a more honest picture of the likely levels of the so called “tax gap” – between tax that should be paid on the UK’s economic activity and the tax that HMRC actually collects – whether caused by deliberate evasion of various kinds or accidental taxpayer error.
Business Committee demand answers from fashion, retail and tech businesses19/10/2020 12:33:00
The Business, Energy and Industrial Strategy (BEIS) Committee has written to a range of businesses in sectors including fashion, retail and information technology, to seek answers in relation to the Committee’s inquiry exploring the extent to which businesses in the UK are exploiting the forced labour of Uyghur in the Xinjiang region of China.
UK Internal Market Bill violates the rule of law and threatens to undermine devolution arrangements, says Committee19/10/2020 11:38:00
The Constitution Committee has published its 17th report of the session on the UK Internal Market Bill.