Continued growth for public sector finances is not sustainable says ICAEW
Friday 20 July 2018, Commenting on the Public Sector Finances for June 2018, published today by the ONS, Ross Campbell, ICAEW Public Sector Director, said:“In June the ongoing month-on-month improvement in the public finances continued broadly in-line with forecasts for 2018. This week however has seen the publication of the 2018 Fiscal Sustainability Report by the Office for Budget Responsibility which paints a far less rosy picture for the public finances over the long term.
“The OBR report makes it clear that, without changes in government policy, the public finances are not sustainable over the long term. This is largely as a consequence of demographic factors driving demand for increased health spending, the triple lock on state pensions and rising adult social care costs. Without either an increase in taxation or a reduction in spending or this will result in a deficit equivalent to £176bn a year and public debt equivalent to 283% of GDP by 2068. In this context the monthly figures serve only as a distraction and the government needs to focus on the bigger (and longer term) picture”
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