Summary
8.The purpose of the Act is to ensure that there is always in place a duty on the Treasury to secure sound public finances for the United Kingdom. In summary, the Act:
imposes a duty on the Treasury to ensure that for each of the financial years ending in 2011 to 2016 public sector net borrowing as a percentage of GDP is lower than the previous year;
imposes a duty on the Treasury to ensure that by the financial year ending 2014 public sector net borrowing as a percentage of GDP is at least halved from its level for the financial year ending 2010;
imposes a duty on the Treasury to ensure that public sector net debt as a percentage of GDP is lower as at 31 March 2016 than it was as at 31 March 2015;
provides that the Treasury may impose, by Order, further duties on the Treasury for the purposes of securing sound public finances and consistent with the key principles (specified in section 155(2) of the Finance Act 1998) for any or all of the financial years ending 2011 to 2016;
requires the Treasury to impose, by Order, subsequent duties on the Treasury for the purpose of securing sound public finances and consistent with the key principles, to apply in relation to future financial years beyond 2016;
imposes a duty on the Treasury to report on progress towards and compliance with the duties at the time of laying before Parliament relevant Economic and Fiscal Strategy Reports and Pre-Budget Reports;
provides that the Treasury’s accountability in relation to the duty and future duties is to Parliament alone, by way of the reporting requirements of section 3;
provides that the lawfulness of anything done, or not done, is not to be affected by the fact that the duty has not been or may or will not be complied with; and
provides for explanations of key terms to be set out in the code for fiscal stability.