The Institute of Chartered Accountants in England and Wales (ICAEW) held a roundtable in Westminster, bringing together the Public Accounts Committee (PAC) chair and other figures to discuss the challenges facing UK public finances.
The event reviewed the latest Simply UK Government Finances report, which offers an overview of the state of the UK’s public finances for the financial year to March 2025.
The roundtable featured Chair of the Public Accounts Committee PAC chair Geoffrey Clifton-Brown, ICAEW Public Sector and Taxation director Alison Ring, and ICAEW advisor and author of the report Martin Wheatcroft.
During the discussion, Wheatcroft spoke on five fiscal challenges identified in the Simply UK report.
These include the absence of a long-term fiscal strategy, demographic shifts with more people living longer, weak economic growth, the quality of public services, and the lack of fiscal resilience.
The conversation turned to old HM Treasury projections, which had underestimated the rate at which public debt would grow, reaching around 100% of GDP in less than 25 years, contrary to the 50 years initially thought.
Current projections say that public debt could surpass 270% of GDP in the next 50 years.
Topics such as NHS productivity, Whitehall’s annual budgeting process, local government finance reform, and prioritising investment in prevention were also debated.
Health was pinpointed as a major factor in the unsustainability of public finances, with rising unit costs deemed more important than the growing elderly population.
The roundtable highlighted the need for mechanisms to prepare for future economic shocks and policies to ensure that any economic gains are used to strengthen the public balance sheet.
The importance of enhancing fiscal literacy among politicians and the public was emphasised, noting the media’s thinning role in providing fiscal policy insights.
The event is part of ICAEW’s ongoing efforts to engage with policymakers and influencers on improving public sector reporting and financial management.
A future parliamentary event is planned to aid select committee members in understanding and utilising annual financial reports more effectively.
Earlier in March 2025, ICAEW submitted recommendations to HM Treasury to prompt the UK government to expedite savings realisation and growth enhancement.
These recommendations will inform the upcoming Spending Review for the financial years 2026-27 to 2028-29, and 2029-2030 for capital investments.
