Coronavirus (COVID-19): UK fiscal path – a new approach
This paper sets out ten principles the Scottish Government believes the UK Government should follow to support the UK economy and public finances as we begin to recover from the impacts of coronavirus.
1. IMF, 2008 available here.
2. The UK Government should take the Committee on Climate Change Committee's recommendations into account when reaching conclusions about the next phase of the economic and fiscal response. Link.
3. The analysis combines the reference scenario published in April and May 2020 with the latest policy costings by the OBR published on June 4.
4. IFS, The outlook for the public finances under the long shadow of COVID-19, June 19, available here.
5. This includes the Bretton Woods system which was characterised by a fixed exchange rate and quantity and price controls on domestic bank lending.
6. Fiscal Sustainability Report 2013, page 125. Link.
7. Bardaka et al (2020) available here and IMF (2016) available here.
8. Letter from Robert Chote to Prime Minister, 2013, available here.
9. See survey by the Centre for Economic and Policy Research, 28 May. Results based on 30 panellists.
10. IFS, June 19.
11. Bagaria, Holland and van Reenen (2012), Fiscal Consolidation during a Depression, available here.
12. The Charter is available here.
13. HM Treasury, Managing fiscal risks: government response to the 2017 fiscal risks report, July 2018, page 116, paragraph 6.2. Link.
14. Seyed Reza Yousefi (2019), Public Sector Balance Sheet Strength and the Macro Economy, IMF Working Paper WP/19/170. Link.
15. The IFS Green Budget, October 2019. Chapter 5, page 130. Link.
16. The Scottish Government can borrow to support resourcing costs only in very specific circumstances: for in-year cash management; and for forecast error in relation to tax receipts and social security expenditure
17. See for example IFS, 15 March, or Fraser of Allander Institute, 26 May, available here.
18. Resolution Foundation, Rainy Days, 22 June 2020.
20. Interim Financial Stability Report, May 2020, Bank of England, page 49. Link.
21. Interim Financial Stability Report, May 2020, Bank of England, page 50. Link.
22. Interim Financial Stability Report, May 2020, Bank of England, page 50. Link.
23. The CityUK. Recapitalisation Group Interim Update, June 2020. Link
24. The CityUK. Recapitalisation Group Interim Update, June 2020. Link
25. Interim Financial Stability Report, May 2020, Bank of England, page 16.
26. The CityUK. Recapitalisation Group Interim Update, June 2020. Link
27. Bank of England. The distributional impact of monetary policy easing in the UK between 2008 and 2014.
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