Reeves warned current fiscal path may lead to short-termism and 'deterioration' of public finances

Urged to shorten fiscal time horizons

Chancellor Rachel Reeves has been cautioned that the UK’s current fiscal path is veering down a concerning path, and was advised to make near term changes in the face of her first Budget next month.

The Organisation for Economic Co-operation and Development (OECD) said in its latest report, that the current fiscal rules "may lead to short-termism and to a trend deterioration of public finance". It also warned the chancellor that the "current rules provide clear guidance about the medium-term plan for retuning to debt sustainability. But the rolling target window leads to sub-optimal fiscal policy and works against long-horizon public investment". OBR warns 'unsustainable' public debt set to reach 274% of GDP by late 2030s This comes a week after the Office for Budget Responsib...