Public Net Worth
Accounting, Government and Democracy
“This important book…..is a call for sensible change. It should be answered” – Martin Wolf
An opportunity to improve long-term public finances
without cutting public services or increasing taxes.
Through better asset and liability management, government revenues can be increased significantly – by several per cent of GDP per annum
Accrual-based metrics also enable and encourage reduced costs, such as reduced interest costs through better debtor and creditor management.
“Just as a company or a household would look at their balance sheet when making investment decisions, so should a government.” – Andy Haldane
What is the opportunity?
1. Adopting accounting-driven, Net Worth-based fiscal rules/targets creates major opportunities to improve long-term public finances without cutting public services or increasing taxes.
2. With a focus solely on debt and cash metrics, governments overlook the value of public assets and the full extent of liabilities. This narrow perspective leaves politicians without the necessary insight or accountability, leading to suboptimal use of resources and potential unfairness across generations.
Foreword by Martin Wolf
Chief Economics Commentator, Financial Times
“An excessively narrow focus on deficits can lead to bad decisions” ….
“The invention of modern accounting is among the most important advances in human history. Without it, today’s complex economies would be impossible.”
….”Government is a complex activity.”
Read the first chapter or order the book here!
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