Source · Select Committees · Public Accounts Committee
Recommendation 30
30
Accepted
OBR forecasts serve as primary gauge for public spending sustainability, WGA provides broader view.
Conclusion
The WGA gives a big picture view of the financial position of the UK government.66 We questioned the Treasury on the financial sustainability of public spending, to which it responded that the OBR forecast that accompanied the autumn budget, rather than WGA, would be the better source for looking at the sustainability of the spend versus revenue position. It commented that the WGA offers a broader view of government finances as it includes things like pension liabilities increases for the year, and so adds to the OBR forecast. However, “in terms of what the Government is doing to set public finances back on a stable footing, I think the Budget and the Budget forecast are the primary gauge.” 67
Government Response Summary
The government agrees and plans to include long-term trend information back to the first published WGA in the 2023-24 WGA, with a target implementation date of July 2025.
Government Response
Accepted
HM Government
Accepted
6.1 The government agrees with the Committee’s recommendation. Target implementation date: July 2025 6.2 The WGA is a valuable source of information on government liabilities, providing a comprehensive picture across the whole public sector. There are other similarly valuable sources of information such as departmental accounts, or the fiscal sustainability and risk updates provided by the OBR. The intent is to provide useful information on the evolution of key balances over a long period. The accounting rules that underpin WGA are generally retrospective, focussing on the current valuation of future liabilities as at the respective balance sheet date. Under these accounting rules it is not possible to forecast future balance sheets, but other publications such as the ONS Public Sector Net Worth statistics provide this information on a statistical rather than accounting basis. WGA seeks to improve by summarising relevant information from these other publications. For the 2023-24 WGA the focus will be to include long term trend information back to the first published WGA.