Why Public Net Worth? (or not)

“Public Net Worth forms one of the broader set of metrics the Government intends to consider for the effective management of fiscal policy.”

Office for Budget Responsibility

“Forecasting the balance sheet: Public sector net worth”

“It thereby encourages government to invest where there is a compelling economic case and the value of the assets generated exceeds the cost of financing.”

Resolution Foundation

‘Totally (Net) Worth It’.

”Just as a company or household would look at their net worth when making investment choices, so too should government.”


Andy Haldane

‘The case for rethinking fiscal rules is overwhelming’.‘Totally (Net) Worth It’.

“the health of the public balance sheet is bolstered by good investment decisions.”


Rachel Reeves

The 2024 Mais Lecture at Bayes Business School

“[Public Net Worth] should reduce the tendency to slash investment whenever fiscal difficulties emerge”.


Martin Wolf

‘How Labour wants to change the British economy’

“A balance sheet rule is just the outcome of a search for an easy answer to a complicated problem”


Chris Giles

‘Beware fiscal rules that are easy answers to complicated problems’

”A lack of attention to the public balance sheet helps explain why Britain consistently underinvests in infrastructure. Projects whose benefits lie beyond the five-year budget forecast struggle to get funded. Meanwhile, governments have sold off public assets and used the proceeds to fund tax cuts, creating the illusion of national wealth while in fact leaving the state poorer.“


Simon Nixon

A few thoughts on Rachel Reeves’

“Public sector net worth ought not, in our judgement, to be at the centre of the UK fiscal framework.”


Institute for Fiscal Studies

‘Public sector net worth as a fiscal target’.

“Better management of assets and liabilities, we estimate that there is scope for the UK government to increase government revenues by 4%+ of GDP – very close to what the OBR estimates is needed to sustain existing levels of public services as the population ages.”


John Crompton

‘Does introducing Net Worth-based fiscal rules represent ‘a long walk for a small sandwich’?

“New Zealand’s new PFM legislation played a significant role in changing the fiscal position from a negative and declining net worth, to one where there was a consistent upward trend in net worth, with an ability to withstand fiscal shocks.”


Arman Vatayan

‘Five Tips to Maximize the Impact of Assets and Liabilities on Public Financial Management’

“Improvements in government asset management can be a game changer.”


Srinivas Gurazada et al.

‘Government Balance Sheets for better management of assets and liabilities’

“After many years where debt and deficit figures dominated all political debate in the UK to the exclusion of all else, it is possible that there may be a growing appetite for a new approach.”


Simon Wren-Lewis

‘Public sector net worth’